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Individual Developers Vs Companies – Why Client Prefer Individual Developers?

New individual developer freelancers have a dilemma that why a client will prefer an individual developer on freelancing marketplace like Upwork when they can hire big companies who have more experienced programmers and developers.

The statement may look to true that clients will hire only companies and so individual freelancing developers may have an issue getting their share of work but the ground reality is totally different.

I am an individual freelancer on Upwork and has delivered more than $70,000 work only in Upwork.

Lifetime earnings may not be that important. Here is my Upwork’s certificate of earnings for the amount I made in last 3, 6 and 12 months as on 8th Feb 2017.

Note: Upwork is not the only source of clients for me.

So individual developers don’t have any future amongst big companies on freelancing marketplace sites like Upwork is a myth. In fact, individual developers have many advantages over companies.

Here are some of the key advantages that individual developers have over companies.

1. Low Cost Due to Less Overhead

The cost of hiring an individual developer will always be lower than the cost of hiring the same quality of developer in a company. The reason for the low cost is not because of low quality but other expenses that a company has to borne that individual freelancers don’t have. The biggest of them all is the rent expense.

Rent is a significant portion of the total expense that a company has to provide a workplace for employees to work whereas individual freelancer working from home don’t have this expense lowering the cost clients.

Rent is not the only additional expense for companies. The expense of extra people like a team leader or project manager or HR people. Even if the company is small and don’t have those team leaders and project managers, it has the cost for owners profit that clients need to pay.

The cost scenario is highly in favor of individual freelancers and companies competing with such individual freelancer only on the price front, has very high chance of running out of business due to low-profit margins.

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2. Explaining Requirement is Easy

We are talking about developers and development projects where the most important aspect of getting things done right is able to understand client requirements.

Companies have a disadvantage when trying to understand clients requirements if the person who is in discussion with the client is not a technical person and believe me most of the time it is not the technical person who is in talk with the client.

Normally the business development person handles clients to understand the requirement and project manager gets it done by his team. So many people being involved makes it really hard for clients to get the requirement communicated and often development projects get delayed indefinitely.

For individual developers, there aren’t many layers of communication and so explaining the requirement of what is needed is easier for clients and things that aren’t feasible gets eliminated very early in the project timeline setting right kind of expectation of clients.

3. Clarity of Experience

Clients prefer individual developers because they know what is the expertise of the person they are dealing with.

If someone hires me at $XX per hour, they know the person working has a decade of experience and has worked on so many projects but when it comes to companies, you never know what is the overall experience of the person working on the project.

Experience in the field of development matters the most because it can eventually make or break the project based on the quality of code. This may not be true for another branch of freelancing where the final output is good enough to judge its quality of how good or bad it is.

A designer, no matter who is doing the design, a client is satisfied with the design means it is a good design.But client may be satisfied with the functional aspect of the code but what about the security aspect of the code or architectural design which cannot be judged based on the output of the final product.

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4. Brain Drain from Companies

There is no entry barrier for a developer working in a company to become a freelance developer.

When an employee knows the source of projects for a company is through Upwork, they will try their hands on.

Employees are that smart for sure and as there is no entry barrier on freelancing marketplace sites like Upwork, anybody can be a freelancer. It can mean smart people will eventually move out of such companies and become freelancer developer and those who cannot manage projects from Upwork will be the ones who continue doing the job in the company.

This is such a happening phenomenon in the small web development companies here in India.

Final Thoughts

If I search for WordPress developer I see we have over hundred thousand individual developers and only fifteen thousands companies. Individual freelancers out numbering companies by such a big ratio isn’t a coincidence.

Individual freelance developers definitely have an edge over companies.

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  • Shruti

    I think individual freelancing and work from home is the future.

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