You don't have to leave your home to get started on promoting your freelance services. If your PC or laptop has an internet connection, it's easy to link up with people actively looking for service providers. How? Sign up to an online service marketplace.
What is an online service marketplace?
Also called service auction sites, these are sites that connect buyers needing services, and service providers looking for projects. It's simple how these sites work: a buyer posts a description of what kind of service he or she is looking for, and freelancers from all over the world can present their bid. If a buyer likes your proposal, he or she will then award you the project, and you can both can commence work.
There are sites that post jobs in different categories; from web design to programming, from writing to administrative support. There are also sites that are exclusive for a specific profession, e.g. an exclusive online marketplace for programming work.
Wait! Are these sites safe?
The community policies itself through buyer and service provider feedback, similar to the system of Ebay. A good track record of paying providers and positive comments usually mean that a buyer is trustworthy. Similarly, an excellent track record of completed projects with positive feedback usually mean that a service provider can be relied on.
All payment and communication are done within the sites for added security. Third party sites, like escrow, manages financial transactions to protect both the buyer and the service provider. The security of the site itself is typically verified by online safety and privacy certification sites like VeriSign or TrustE.
This said, it doesn't mean that there are no buyers or providers who register on the site to defraud members, nor does it mean that the site can't be hacked. You have to be careful and conduct independent investigation on a buyer before accepting a project.
Similarly, disputes can happen between buyers and providers over the course of the project that can prove costly. The extent the management of online marketplaces arbitrates on contract disputes and provides insurance for lost data or money varies from site to site.
In general though, these sites are safe as long as you exercise caution and follow site rules and regulations.
Sign me up! Where can I find these online service marketplaces?
Active online marketplaces include:
Elance
Elance is one of the best thriving service marketplaces around, in the sense that there are new job postings almost every hour. Membership is free, and comes with 10 connects (bidding currency) per month with the option to upgrade for a small fee (the lowest paid membership package is $9.95). This makes Elance one of the more beginner-friendly auction site, as you can start aggressively bidding on projects paying zero to just minimal registration fees.
The site deducts some 6.75 to 8.75% (the rate depends on your lifetime earnings) of the money that you make, presumably for web hosting, customer support, escrow etc. As with most auction sites, service rates range from low ball to reasonable with the occasional high paying gigs --- so price your services accordingly.
Great site features: a chatroom for buyers and providers to unwind and socialize, as well as safety nets against unpaid work samples, academic projects and plagiarism.
Guru
Guru is as active as Elance, and offers roughly the same range of projects and benefits. Membership is also free and comes with 10 bidding units/ month. Guru, however, restricts bidding for non-paid memberships (making unpaid membership basically useless), so if you're interested in just "feeling around the site", you might not be able to get a gig.
The site also deducts some 5-10% from your project earnings (the rate depends on your kind of membership). Bank fees can also be deducted depending on buyer's credit card provider.
Guru offers a higher number of bidding units per subscription, almost three times that of Elance. Guru also asks for a flat rate of one bidding unit/ project, unlike Elance which asks for more connects for higher-paying gigs or featured project. The catch: the minimum subscription you can buy is a 3-month one ($75).
Guru's system both works for you and against you. On one hand, you get more bid units per month than what you can use, and thus you can bid on all the projects that catches your fancy --- with extra to spare. On the flipside, however, bidding in Guru is much more competitive compared to Elance. There can be more than 100 other service-providers gunning for the same project as you, while Elance's averages from 10-30 depending on the work.
Great features: option to unpublish negative feedback, ability to post multiple profiles for the same job category.
Freelancer (formerly GetAFreelancer)
Freelancer is another active service marketplace offering both free and paid (called Gold Membership) subscriptions. Compared to Elance and Guru, Freelancer just asks for a 3% commission from what you earn if you're a Gold Member ($19.95/month). Jobs in Freelancer (as well as in oDesk below), however, tend to pay lower rates relative to Elance and Guru--- and the competition is much more cutthroat.
A main difference Freelancer has over the first two sites discussed is the ability to work in several categories without having to pay extra. In Elance and Guru, you have to select just one category, say "Web Design" to work on. If you want to bid on other categories, that's an additional fee. Free membership in Freelancer, however, allows you to pick from 25 subcategories of work, while Gold memberships 50 subscategories. Therefore you can be a writer, a web designer and a virtual assistant with just one profile.
oDesk
Unlike Elance, Guru and Freelancer, oDesk doesn't have paid membership options; non-paying and paying members get the same benefits and privileges. This is great for people testing the waters, those who are interested in just the occasional freelance gig, or those who don't want to shell out on monthly memberships. The site does ask, however, for a flat 10% commission on all work done, a higher commission compared to Elance's 6.75-8.75% cut, Guru's 5-10% and Freelancer's 3 percent.
oDesk is another cutthroat bidding site (low-ball bids, lots of competition) --- but there are plenty of jobs to choose from if you don't have a high hourly rate.It's main selling feature: a unique interface that allows buyers to view at any time what you are working on and track hours spent on a task. This feature is a great idea for transparency --- buyers know exactly how much each of their paid time is being spent, and providers know how much exactly they should bill. But of you're the kind of worker who likes to browse random sites and answer IMs while you work, then the oDesk system might not be for you.
Hmm...Are online service marketplaces really for me?
You know what, you're the only one who can answer this question.
The benefit of service auction sites is the convenience of finding projects postings in just one place. The bane of auction sites is that it forces you to present your best offer to buyers --- and most of the time, this means lowering your rates or doing more than the usually do/ hourly rate. You compete with providers all over the world --- so if you're from a first world country, expect to have to compete with a third world provider who can do the same job for less.
Which is not to say that providers with above average rates don't thrive in these marketplaces. Targeted bidding, specialized services, awesome proposals and consistent work quality can get you a reliable above-par income in these sites. You may even function as a team manager, and source and outsource work instead providing direct services.
*Fees and rate are true as of January 3, 2010.
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