Successful subcontracting deals require trust on all sides

Subcontracting offers benefits for firms, clients, and vendors, but such deals can often be hard to arrange. Anita Chabria discovers tips and tactics that can help alleviate some of the guesswork

Subcontracting offers benefits for firms, clients, and vendors, but such deals can often be hard to arrange. Anita Chabria discovers tips and tactics that can help alleviate some of the guesswork

Subcontracting is common practice for many large PR agencies. Whether it's simply a need for more bodies to do the work, a requirement of a government contract for minority- or women-owned shops, or a desire for expertise in a specific area, large and midsize firms often offer up pieces of the pie to smaller shops. Some small shops even get in on the subcontracting business, bringing on solo practitioners and freelancers when things get busy.

While subcontracting offers benefits to both sides, it can also be a difficult and tricky arrangement. When it comes to being successful as a subcontractor or an employer of one, the experts say the relationship must be built on trust.

"You must be responsible and trustworthy," says Marika Flatt of Austin, TX-based PR By The Book, who has both hired subs and worked as one. She says that clients will judge their own firm on the quality of the subcontractor's work, often not bothering to differentiate between the two. That means that a mistake by a subcontractor could cost the agency its client.

For the subcontractor, part of building that trust means treating the primary agency exactly like you would a client and making sure communication is clear and frequent.

"We are in constant contact with our clients each day via e-mail," says Flatt. "The more you keep them in the loop about activity that's happening, the better the relationship is going to be."

Francisco Miraval, head of Aurora, CO-based Latino specialty shop Project Vision 21, adds that part of communication is knowing what you don't know. "Avoid thinking you already know enough about a project, a person, or a culture," he warns. He adds that the same goes for the primary agency, which needs to remember why it hired a sub in the first place. "It is up to the agency to realize that what works for one culture or project may not work for another and to give enough freedom to the subcontractor to do its job."

"Nothing can damage a relationship with a subcontractor more quickly than not responding to requests for information, support, or clarification," notes Barry Grossman, transportation account group director at Colorado Springs, CO-based PRACO (Public Relations and Advertising Co.), which has hired Miraval as a subcontractor on numerous occasions.

Another key to managing the relationship is setting clear expectations.

"The best thing is to clearly define both roles before getting started," says Paige Wolf of Philadelphia-based Paige Wolf Media and Public Relations. She says that both sides need to discuss issues such as how the media will be handled. Who will be the press contact, for example, and how will you be identified - as a subcontractor or a member of the primary firm?

"Open dialogue, clear expectations, and a clear understanding of each other's responsibilities are key elements," says Miraval. He adds that in his position as a Latino subcontractor, where "there are language and cultural differences, one of the best practices is to establish a working relationship on the basis of understanding and respecting those differences."

Once rules are set, stick with them, says Joan Stewart, head of Port Washington, WI-based The Publicity Hound.

"Respect boundaries between you, the client, and the agency you are working for," she says. "If the agency wants to be the primary contact between you and the client, respect their wishes."

Of course, subcontractors are in it for the money, so getting payment squared away is key. Most of those interviewed agreed that there is not an industry standard for how subs charge.
Some do it by the hour, some by project, and others as a percentage of a contract.

"Sometimes I'll just do a little work for people that's just on a strict hourly fee," says Wolf. "And sometimes we literally take over a project, and I'll be the point person, and then maybe they will give me 50% of what they get."

No matter how the bill is being determined, Grossman says it's key to have a comprehensive contract that spells out exactly what the services are.

"Specify what the maximum budget will be for the contract," he advises. "Include all duties, expectations, and requirements. This includes what the subcontractor will be reimbursed for regarding mileage expenses, outside direct costs, long-distance charges, and other expenses."

Most important, he says, make sure the sub agency knows when it can expect the check - especially if it won't be paid until the primary agency is.

"Ensure the subcontractor understands when payments will be issued," he notes.

Keys to subcontracting

? Communicate. Both sides need to keep the other informed
? Respect boundaries. Make rules and follow them
? Cover the details in a contract
? Treat the primary agency like a client
? Be clear about payment terms

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