Monday, June 20, 2011

Finding the market segment for your labor

The traditional model for a unit of labor (i.e. you the employee) is that you are a set of marketable skills collected into one place and then sold directly to a consumer (i.e. the company). You advertised your supply via the resume and they advertised their demand via the want ad.

However there is another model that has bounced around for a long time. That is the one where you market and sell your output to people who wanted it. Maybe it went directly to the consumer or maybe there was someone who passed your output on to the consumer for a fee (e.g. an art gallery that sells paintings on consignment).

Lets view that model in light of more traditional skills. Consider your skills as a service that can be used by another company to enhance their goods or services rather than something they directly consume. In fact, to provide a concrete example. As a software tester a company might pay you $50,000 per year to work on their software... or they might pay Aspiritech $100,000 for the same task. There is some overhead in having an employee but more often than not it is the perception of the business that employee costs are a different bucket and one that can be squeezed down. Vendors on the other hand, well that is what the market will bear.

So when looking for a job find out what the vendors in the market segment charge for a similar service and then market yourself as a vendor if the money is better.

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