Benefits of Outsourcing Research to an Offshore Vendor

QUESTION: I spend a great deal of time sourcing my candidates. If I can relieve the burden at a reasonable price, this makes sense to me. I have heard you talk about having sourcing done by off shore vendors in India or the Philippines. Do you have any that you would recommend and to give me some guidelines how to find these people.  – Bill

ANSWER: I do not recommend individual researchers because mostly they are individual contractors, and my clients that spent a lot of time finding them are giving them a lot of time and would shoot me if I revealed them, and I can empathize, because they found an individual, they did not find a great company.

What I hear about companies that do research out of India or Asia is they start off like gangbusters and then drift off. Honestly, I do not want to mention any particular names of companies because that is the typical process and I do not want to slander anyone based on hearsay. My clients that are most successful using a researcher have found an individual that they have gotten comfortable with and that they have mentored through the process.

The next question I am always asked regarding researchers relates to cost. My wish for the recruiting industry is that they obsessed about upside as much as they obsessed about outsourcing costs. Costs are near irrelevant as it relates to the huge search fees that we have.  So when you say at a reasonable price, I am going to define a reasonable price and I am just going to make an assumption, Bill, for argument sake since I do not know your goals, I do not know your situation, more so to make a point to the broader audience.

Let us say you are billing at $300,000 a year. That means you make $150 an hour if you worked 40 hours a week. So I would challenge you to say $75 for a researcher that would 1 for 1 alleviate an hour for you is a reasonable price. In fact, researchers are a fraction of that cost. You can get good researchers from $5 to $20 an hour, which is an incredibly reasonable price.

I could make an argument that $100 an hour for a great researcher if your bill rate is $150 because now you are going to net $50. However many recruiters will think $100 an hour is outrageous. When research is done with the right person, who can get the same or better results than you, it is a phenomenal investment. Usually a great researcher is going to uncover more people than you can in a much quicker timeframe. Again, I am using an absurd number because I know there are a few high end researchers that charge this fee, but the researchers I am recommending through Upwork or other outsourcing sites are a fraction of this.

Leverage is how one grows and is able to increase billings from $300,000 to $600,000 even if you are a solo recruiter and work fewer hours. Yes, recruiters who use researchers as leverage see their investments go up. They are hiring more researchers. They might have a part time recruiter. There are all kinds of things that they put in place and they invest in. Maybe at $300,000 a year with very few investments, let us say your profit margin is 90%, well at $600,000 let us say your profit margins go down to 75%, but you can work less. Is that not a great investment?

So one of my mantras that I talk a lot about with my clients behind closed doors, that I would like to invite you to consider, is get off the cost wheel and stop compromising lifestyle to save $15, $20, $30 per hour and say what does this liberate from me? What does this allow me to do that I do not have the time to do now? With that being said,  I have had some clients that found some researcher gems at $6, $7, $8 an hour, which is the exception.  The sweet spot is $10, $15, $18 an hour for a good researcher.

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