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Is it ethical to sub-contract from another agency?

For years, above the line agencies have sub-contracted production and artworking to smaller firms because of the low profitability for that work.  But few brands have complained as long as the right ad ran at the right time in the right format.

“Partnering with specialist skills is and always has been good agency practice. No agency can have all the skills needed by all its clients – particularly in production.” Says Colin Wilson-Brown, of Clinic.net.au

The plethora of new specialisms particularly in digital means that few agencies have all the skills in-house for a big brand brief.  Many briefs are very specific about the requirements and this sends agencies scrambling to find a partner agency, a freelancer or a sub-contractor to join the team so that they can bid on the pitch.  Chuck Meyst from AgencyFinder.com calls this “a rather common practice …to establish "strategic alliances" to "fill in the dance card."  Whatever you like to call it, partnering with specialist skills is and always has been good agency practice. No agency can have all the skills needed by all its clients.”

How to find a sub-contractor or partner agency

We can find no online site where agencies can find collaborators – it seems that personal networking is the preferred introductory route in US, UK and Australia – and that’s three large markets for creative agency services.

Lee McKnight, RSW/US agrees, “In my experience at least, it’s pure networking. You’ll have the added awareness that the handful of crowdsourcing agencies have created in certain cities for freelancers, but otherwise, all networking as far as I know.

What can agency principals do?

Get out and build your own list of potential collaboration agencies in your city.  Research the best targets, approach them and be ready with a short, sharp text about whether they keep a list of specialist sub-contractors and how to get considered for inclusion.

Darren Woolley at Trinity P3 told us that

There are a number of people who manage these lists - Creative Director and the creative department, Production Managers and the Studio Manager and often there is no single source of information. “

Follow through in the same way that you’d pursue a new brand manager – get a chemistry meeting where you can present your portfolio or show reel.  And then nurture them like crazy.

What are the pitfalls?

There are three main areas where a sub-contracting agency is putting their business at greater risk than the firm giving out the work.

The first is managing the client relationship.  Because the superior agency owns the client relationship, the sub-contractor has to trust both their honesty and ability to retain the client’s business.

The second pitfall is that as the sub-contractor you cannot claim the client work on your agency credentials or portfolio.

This is probably easy to overcome if you agree up front that you have the right to be associated with the job but it impacts the first pitfall as well because if the other agency wants you to remain anonymous it undermines their credibility with the client.

Lee McKnight counsels clarity on the role assignments and whether the sub-contracting agency is named or not to the client.

“It’s key to discuss up front who gets credit for what and how that will be handled.  We’ve talked to agencies who were initially okay in being a seamless part of the other agency, but after several high-profile projects, decided they wanted to do it on their own, and found themselves not being able to reference their work as case studies or on their site.”

The third pitfall comes about during a competitive pitch when the same freelancer or sub-contractor does work for more than one firm who’s pitching the brand.  Darren Woolley has seen this happen,

“It is a bad practice is when agencies call in sub-contractors during a pitch to help them win the business.  In some circumstances the agency wins the business without revealing the work was done by sub-contractors and the client never gets the same quality of creative work again. This is clearly misleading and deceptive in the pitch process as the client is trying to determine the quality of the agency, not the quality of their sub-contractors."

What about you?  Is this a new business technique that you’ve used to success and will you do more sub-contracting in 2013?