Freelancing on global platforms: competing on price

Freelancing on global platforms: competing on price

Making a living writing code on platforms like Elance, oDesk or Fiverr is possible. It is also exhausting, poorly paid and, often, a waste of time. The promise of remote work without a boss collides with a stubborn reality: global rate competition turns the Spanish professional into an expensive supplier within their own market. One user sums it up bluntly: after six months on oDesk, they cover their expenses and earn "a small bonus" that never exceeds 100 euros of monthly surplus.

The menu of platforms is broad: Elance, oDesk, Freelancer, Nubelo, Twago, Guru, Fiverr or Toptal. The hierarchy, according to those who have used them as clients, is clear. Elance is the king for serious technical projects: there, engineers who work for Silicon Valley startups in the morning moonlight in the evening. At the opposite end, Fiverr works as a bargain-basement services bazaar where the seller charges in dollars and adds paid extras on top of a 5-dollar base.

The trap of competing on price

The problem appears when the Spaniard tries to sell their hour. A developer with experience outside these sites says he sent eight bids on oDesk and did not get a single hour of work. The reason he points to: projects mostly go to suppliers from India or Pakistan for less than 10 dollars an hour. Without a prior fruta on the platform, competing on rate is a race to the bottom that rarely pays off.

Add to that the platform's cut, which keeps a percentage of every payment, and the absence of invoices, social security contributions and any real employment relationship. The hired party does not know who their client is and the client does not know who they have hired. The only mutual guarantee is the feedback system: a negative rating weighs like a millstone. And payment arrives in dollars, a currency that, as another participant jokes, is worth less against the euro every day.

The Spanish client, the worst rated

Distrust runs through the discussion in both directions. Several clients admit deliberately avoiding suppliers from certain countries after past experiences with half-finished or late deliveries, and they apply the same prejudice to local clients. A professional who has worked for clients from several countries says it plainly: it is best to steer clear of Spanish employers, who ask for tight budgets, pay late and lower your rating when you contradict them.

The argument is repeated in terms of work ethic: the claim is that the culture of the quick buck and constant haggling complicates the relationship with the domestic client, while clients from Canada or the United States pay better and respect deadlines. These are generalizations that the participants themselves acknowledge as prejudices, but which guide their purchasing decisions.

The alternative: personal brand and contacts

Against the auction market, a different path emerges. Those who have hired on these platforms recommend, for the worker, personal contacts and building a personal brand: many clients do not know what they want and, remotely, communication is worse and pay is lower. Another option is niche specialization, like the developer who turned his technical manual into a book sold in several languages and now lives off it and off collaborations with companies.

The full calculation, with the platform's cut, the hours spent bidding and the exchange rate, leaves a margin that surprises anyone hoping to make a living from this. It works for getting experience, covering a slow month or testing a niche. As a substitute for a salary, the story falls apart.

The cautious prediction: as long as the euro remains strong and the global supply of technical labor does not shrink, these platforms will remain a supplement and not a plan. Unless you land in a very specific niche and know how to sell yourself outside the auction. There, perhaps, there is business.