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How Does Elance Work, and How Much Does It Cost?
Mark
posted this on June 22, 2011 08:45 am
How Does Elance Work, and How Much Does It Cost?
How Elance Works
Elance delivers an immediate, cost-effective and flexible way to find, hire, manage and pay independent professionals and contractors online.
Why People Love Elance
Client who tap into Elance's skilled talent pool to distribute their work, love Elance for many reasons including:
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Click here to post a job.
If you are a contractor independent professionals count on Elance to help them:
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Click here to become a Contractor.
Getting Great Results
The Elance Work System guides the entire online work process to ensure great results by providing a standardized way to set up work engagements, manage the work and exchange payment for results.
The Elance Work System facilitates structured communication, brings clarity on what needs to be done and when, provides tracking, updates and regular reviews of the work in progress, solicits feedback throughout the process and helps release payment from Escrow for the work delivered.
How Does Elance Make Money?
Elance makes money when the work is delivered and payments are made through Elance. When clients make a payment to their service contractors, Elance deducts between 6.75% and 8.75% from the payment to cover its Service Fee and Payment Processing costs, and transfers the remaining amount directly to the service contractor.
Additionally, Elance service contractors choose between free and paid monthly membership plans based on their level of activity. People who hire elancers pay no fees beyond the money that is paid to the contractor for the work that is done.
It is completely free to register, post jobs, and hire on Elance. Elance makes money when the work is delivered and payments are made through Elance. When candidates quote an hourly rate or a fixed price, the quote includes the Elance fee, which is between 6.75% and 8.75%. When you pay Elance for work performed by your contractor, Elance deducts the fee and immediately transfers the rest to the contractor. In other words, the cost of using Elance is included in the price quoted by your contractors and Elance only makes money when you approve and pay for the work.
Service Fee:
The Service Fee is Elance’s earned commission and ranges between 6.75% and 8.75% of payments made to contractors for work delivered (this includes Elance's fee and Payment Processing costs charged by credit cards and banks).
The Service Fee varies as follows:
8.75% - standard Service Fee for relationships less than $10,000
6.75% - discounted Service Fee for relationships that exceed $10,000 and new relationships referred to Elance
The Service Fee applies to all payments that a client makes to a service contractor identified on Elance in the first 2 years, whether the payments are made through Elance or not. After 24 months the Service Fee applies only for payments made through Elance. For additional information, please refer to our Terms of Service.
Contractor Membership Plans
Contractors who join Elance select one of four membership plans that best fits their needs ranging from free (ideal for getting started) to plans suited for contractors who are active in seeking clients and submitting proposals.
Withdrawing Funds from Your Elance Account
When contractors receive payments, there are several options for withdrawing funds. Below is a table which shows the fees associated with each withdrawal method:
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Withdrawal Type |
US |
International |
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ACH |
Free, Unlimited Withdrawals |
Not Available |
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PayPal |
Free, Unlimited Withdrawals |
2.5% PayPal currency conversion spread |
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Check |
Free, Unlimited Withdrawals |
Not Available |
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Wire Transfer |
Not Available |
Paid Members: First monthly wire transfer Free members: First monthly wire transfer $10, subsequent monthly transfers $25 Other fees may apply from correspondent |
The Elance Work System Overview
The Elance Work System (Elance's features, tools and processes that facilitates online work) puts you in control, keeps you safe, and makes sure that you get great results.
- Job Posts allow you to post your job description and attract customized proposals, often within hours
- The Workroom - the hub of the Elance work experience - is a private online workspace that facilitates collaboration and tracks communication
- Terms & Milestones help define the work that needs to be done and by when
- Status Reports track progress on work performed, and establish next steps
- Tracker allows contractors to document their work activities in real time
- Timesheets make invoicing and billing on hourly jobs simple and painless
- Escrow payments protect both parties jobs by pre-funding the work and releasing payments only when results are approved
- Ratings and feedback are public records of client satisfaction, and inspire great performance
Job Posts enable companies to describe their job requirements, set a budget range, request specific skill sets, and start receiving proposals from service contractors within hours.
The Workroom is the hub of the Elance Work System. Workrooms are automatically set up for each work engagement to manage the job. Workrooms enable real-time interviewing, proposal evaluation, hiring and collaboration, capturing and storing all communications, sharing files, approving work, and tracking invoices and payments for work received.
Terms & Milestones are established at the outset of a work engagement to set the pricing (terms) and define the timing of what is expected by when (milestones).
Status Reports are weekly updates submitted by service contractors, with a record of work completed, progress made, and plans for the upcoming work week.
Tracker allows contractors to document their work in real time. The information captured with Tracker is used to automatically generate detailed status reports and timesheets for hourly jobs. Work tracking facilitates accurate and streamlined billing. While Tracker simply tracks time and automatically updates the timesheet, Work View allows the contractor to stream images and comments into the Work View section of the workroom. The images are taken at random intervals throughout the hour to create a record of the work performed online. Learn more about Work View.
Timesheets make invoicing and billing for hourly jobs a snap. Contractors submit their timesheets weekly, with notes on tasks completed
Escrow facilitates safe payment on fixed price work while building confidence between both parties. Using Escrow, clients can pre-fund the work to enable work to get started. As work gets received and approved, payment gets released to the contractor. Contractors appreciate Escrow as they’re able to see that the funds are held in reserve for their work while clients benefit from Escrow by knowing that they’ll only make payments when they receive actual results.
Ratings and feedback are shared by clients after the job has been completed. These ratings are made public and are kept as part of the permanent work-history of the contractor. Successful Elance contractors consistently satisfy their clients and their feedback and ratings prove it.
Still have questions? Contact us..
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