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Consultant vs Contractor vs Employee: Whom to Hire?

November 30, 2021
5 Min Read

Consultant vs Contractor vs Employee in Marketing: Whom to Hire?

According to a recent Harvard Business School report, 60% of business leaders expect full-time employees to play less of a role in their future teams. And the alternative? Outsourced talent — or a blend of in-house staff and external help.

The precise balance will change from business to business and from team to team. Yet, the message is clear: outsourced marketing consultants, contractors, and employees may all have a place in your startup, scaleup, or established brand. Your task involves the delicate art of knowing which is right to hire, and when.

We’re here to help. In this article, we’re exploring all the differences between consultants, contractors, and employees. And we’ll let you know the pros and cons of each of these professionals when building your marketing team from scratch.

Consultant vs Independent Contractor vs Employee: The Key Differences

Contractors, consultants, and employees all have a role to play in the modern enterprise. But what precisely are the differences between them?

In brief, employees provide dedicated in-house support across tasks. Contractors, on the other hand, are on-demand external hires, who deliver services on a project basis. That’s true of consultants too, who are simply contractors offering strategic guidance.

However, be clear which you are taking on before you hire, though — as there’s an important legal difference between contractors and employees, based on:

  • Your obligations. Employees are defined by a legal status. They work a contracted number of hours and, in return, you provide things like pension contributions, sick pay, and a minimum notice period. With contractors and consultants, meanwhile, they’ll pay their own tax and pension, and you’re bound only by the contract.

  • Your level of control. You ask a contractor to produce a specific deliverable by an agreed date. You’ll outline what you want, but you won’t control how they work, when, where, or with what tools. With employees, on the other hand, you can have a say on all of this. Each has its perks – and its drawbacks. But more on those later.

With that out of the way, whom to hire?

When to hire an employee?

First up, employees tend to have permanent roles. And, as an employer, you’ll usually have exclusive access to their skills and a big influence over how they spend their work hours. 

That’s all great if you need longer term support, but less good if you need just an extra pair of hands on a specific project.

When is it best to hire an employee?

  • When you need general support in a changing role. While a relationship with a contractor can evolve, employees are better-placed to provide long-term support in a changing or undefined environment.

  • You need regular personpower for the long haul. If you know you are going to need general support for the foreseeable future, an employee can provide that reliability, even if they may have extra costs.

  • You’ll supply tools and training, or day-to-day guidance. If you want to play a role in a hire’s career growth and skills development, they’ll likely be an employee. Contractors, meanwhile, take care of their skills and tools themselves.

When you’ll need a contractor

Contractors, meanwhile, can be anyone that sells your business a specific service or deliverable – for example, a freelance writer or a marketing advisor.

As a result, they’re usually highly-specialised, and come ready to deliver. That means you need to offer no training and relatively little onboarding. You

can use a tool like Jotform Sign to automate your onboarding process and collect e-signatures remotely.

You could benefit from a contractor include when:

  • You need a precise deliverable. A one-off report, a piece of market research, or an email campaign. A contractor will be more than happy to provide.

  • You don’t have the specific skills you need in-house. If you are lacking a copywriter or graphic designer, a contractor can be a convenient solution. Tell them what you need and they can deliver – without you needing to bring one in-house.

  • You’re scaling at speed and need extra muscle. Say you want to boost your content production. Hire content writers to handle the increased load for that specific project.

When to hire a consultant

Consultants are contractors that can also help you solve strategic problems – not just deliver the goods.

You can benefit from a consultant if:

  • You have a problem that needs to be solved. Consultants excel in providing solutions for specific, defined problems. Maybe your site isn’t converting, or your Google Ads aren’t bringing in leads. A consultant can tell you why – and provide the solution.

  • You want outsourced leadership over a specific campaign, project, or channel. Say you want to scale your marketing activities in support of a new product. Hire a consultant to take care of a channel from the top to completion.

  • You need strategic advice. If you want a second opinion or new perspective on your marketing goals, aims, and processes, a consultant’s insight can be indispensable – with no further obligations.

Building a Marketing Team with Employees vs Contractors: The Pros and Cons

In established businesses, consultants, employees, and contractors all have their uses — and they often work in tandem. But when you’re building your marketing team from scratch at an early-stage business, what’s best? Contractors or employees? 

Here are some pros and cons of each to bear in mind.

The perks of building a team with contractors and consultants

  • Flexibility. For those seeking marketing talent on-demand, contractors provide skills with agility and speed on a flexible, project basis. And, talking of flexibility, if you and a contractor get on well, you can always offer them a permanent position later.

  • Plug-in capabilities. Specialist contractors come ready to get the job done – often with their own teams and dedicated tools to scale. That saves you onboarding and training time and promises immediate results.

  • Specialised, market-leading skill set. Usually, contractors sell a highly specialised skill. When marketing is becoming ever more reliant on specific digital tools – and when 88% of businesses struggle to find skills in those tools – this deep knowledge is a crucial resource.

  • Objectivity. Contractors and consultants offer an external perspective that isn’t muddied by potential workplace politics. For problem-solving and strategic evaluation, that’s invaluable.

The downsides?

  • Choosing the right contractor. There are lots of consultants, freelancers, contractors, and self-employed workers out there. Finding the one that’s right can be time-consuming — and a little hit or miss.

    By the way: At Traktion, we make that easier, by matching businesses with vetted and proven freelancers based on over 100 factors. Find the right contractor or consultant in 3 easy steps.

  • Competition with other clients. Contractors and consultants work with lots of clients – and may not be available at every moment that you need them.

  • Fragmented team. If you are building an entire department with external contractors and consultants, things can get a little messy without the right leadership and organisation.

Employee-based teams: The benefits

  • Greater control. Contractors deliver the product and take the process out of your hands. If you want to guide things a little more though, an employee might be better. You get to influence how a job is done.

  • Easier to foster team culture. When everything is outsourced, it’s difficult to cultivate a shared business culture. Employees working in the same space can have deeper relationships, which can boost productivity and profitability. That said though, team culture among freelancers doesn’t have to be a problem.

  • Loyalty and availability. Contractors work for different clients at the same time – and that can include your competitors. Employees, on the other hand, tend to be more dedicated to your brand. You know you can count on them for their contracted hours, and that can be useful in the long term.

  • Deeper knowledge of your business. When someone lives and breathes your business, they’ll know it inside out.

The drawbacks?

  • Higher overall cost. You’ll need to pay PAYE and pension contributions for each employee – and provide them with the equipment they need.

  • Less adaptable. When marketing trends and technologies are moving so fast, the person you hire today needs to keep up with a changing environment. And it’s your responsibility to help them develop all the skills and experience that’s needed.

Conclusion: Blending Consultants and Contractors with Employees

So, what will it be — consultant, contractor, or employee? Ultimately, that’ll depend on your marketing needs and preferences. 

Remember, though, there’s nothing stopping you combining in-house staff with outsourced talent. In fact, by blending the reliability of employees with the flexibility of contractors, you get the best of both worlds.

At Traktion, we can connect you with some of the world’s best marketing talent. All of the freelance marketers in our network are vetted and verified. We’ll match you to the right fit. Get started today. 

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