The Ultimate Guide to Choosing Between Freelancing and Outsourcing for Your Business

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The Ultimate Guide to Choosing Between Freelancing and Outsourcing for Your Business

Freelancing and outsourcing are two words that are often used to indicate a similar meaning. But these two words hold two opposite position in terms of meaning and functions. Many people use these two words as a synonym for one another because they do not know the meaning of these two words. Let's explore the difference between these two ideas.

Basis of the Difference



1. Etymology

The word ‘freelancing’ derived from the words ‘free’ and ‘lance’. ‘Free’ means ‘independent’ and ‘lance’ means ‘machinery’. So ‘freelancing’ means ‘working independently’.      

The word ‘outsourcing’ derived from the words ‘out’ and ‘source’. So, ‘outsourcing’ means ‘getting a source from outside’.   

2. Definition

Freelancing is earning by working independently without any obligation.  

Outsourcing is getting a job done by a freelancer by paying him/her without employment.

3. Relation

A freelancer gets a task and the payment of the task from an outside source (outsource contractor).

 An outsource contractor provides the task and the payment to the freelancer.

4. Function

A freelancer functions as an independent worker. S/he has no obligation to do any work. S/he can do the work whenever s/he wants. If s/he submits the completed work within the deadline, s/he will get paid. If s/he does not, s/he won’t get the payment.

An outsource contractor functions to maximize the utility of the resources he/she/it has by just getting the work done by someone without employing him/her. An outsource contractor can also function as a mediator between the company and the freelancers.   

5. Payment

A freelancer gets the payment according to his/her tasks. S/he gets payment/remuneration but not a salary.

An outsource contractor pays the freelancers according to their tasks. She/he/it does not need to pay any salary to the person doing the task.  

6. Example

Suppose, Alex is a freelance writer. He gets a call from John for a task. John gives him three topics to write three articles containing at least 1000 words in each of them. John promises to give Alex 20 dollar per article. Now, Alex has the liberty to take the job or leave it. This is freelancing.    

John is the outsource contractor in this case. He is an employee of a company. The company requires some articles for its website. There is no employee who can write efficiently. So, instead of employing another full-time worker, the company hires a freelancer to do the job. So, this outsourcing saves a handsome amount of money of the company.  

7. Advantages
  • There is no obligation that you must do the job.  
  • There is no time barrier that you must complete the work in between 9 am and 5 pm or 10 am and 6 pm. You can do it whenever you want.  
  • There is no one who can boss you. You are your own boss.
  • Everything is flexible in freelancing. You have the liberty to decide. 
  • By outsourcing, you can get the work done by spending a minimum amount of resource and money.
  • You do not need an extra office space and you have no liability to the worker.  
8. Disadvantages
  • There is always a risk in freelancing as there is no guarantee that you will be paid or your work will be accepted to be paid.
  • Freelancing jobs are not always available. You may not always find the work you want to do.
  • There is no fixed income in freelancing. You might earn 100k in a month or you might earn 10k. It depends on how much work you can get, can do, or want to do.  
  • There is no guarantee that you will get the work done. A freelancer can always refuse to do the job.
  • You will not get the quality work every time by outsourcing. 
  • It may take more time than the usual for getting the work done.


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