Starting a digital agency by outsourcing fulfillment
I've see a few videos of Alex Berman on YouTube. He propagates that you can start a digital agency, providing different services like design, development, social media marketing etc.
To get customers, he suggests to do cold emails to the relevant people. But here is the important thing. For service fulfillment, he suggest to outsource the work instead of doing it on your own.
For example if you get a client for $2k, you can outsource it @ $600 (via upwork) or you can hire in-house professional at lower salary and you keep the difference. So basically your only job is getting the clients (i.e. business development).
My questions are, is this idea any feasible? what are the potential issues with this business model? is anyone here doing it already.
Love to hear your feedback.
I watched his stuff and got excited about the idea and tried it for my agency too. Never truly got there.
There is a big painful period of actually sourcing the right suppliers. A lot of folks and agencies left me pants down. A bunch of places just don’t do good work for the price. Everyone promises to deliver great things, but they’re human and things happen, misunderstand and admittedly I’ve not always known what I was doing. Also, it’s hard to try find cheap suppliers and expect high level work.
The other part is that I didn’t go full on cold client because I didn’t have that confidence in a range of suppliers behind me. That makes it harder to make good margins since you take what you can get and I think most people were like me in that they start with lower quality clients first.
It’s still the vision in this case but meanwhile I’m happy with my little crew of subcontracting friends who do part each project while I also work hands on. The plan to get there is grow client size and eventually work with trusted agencies to handle each thing instead of subcontractors.