As a business owner, it's always good to know that you have options. And when it comes to hiring, you now have more options than ever. In addition to hiring standard employees, there's also ample opportunity to contract with freelancers. But if you're going to pursue this route, you need to know what you're getting into and how it's different from the typical employer-employee relationship.

Let's check out some of the things you need to know before going any further.

Vetting is Extremely Important

Thanks to the power and speed of the internet, you can find a freelancer for any job or need in five minutes or less - guaranteed. Does that mean you can find the right freelancer? Not necessarily.

When searching for a freelancer, thorough vetting is of the utmost importance. Look for freelancers with strong portfolios, client testimonials and referrals, and professional web presences. Good freelancers will take the time to develop a "brand," while your average freelancer will simply tell you they're looking for a job. In the case of freelancers, you can generally judge a book by its cover.

You Need a Concrete Budget

"Pay can be a sticking point when trying to line up freelance workers," entrepreneur Peter Daisyme notes. "Many professionals have a set rate for each project, so one of the first questions about any potential job should be about pay range. If you set your offering prices too low, you'll have difficulty attracting experienced talent, but if your rates are too high, you'll quickly run through your budget."

The importance of developing a concrete budget cannot be understated. Your budget will, to an extent, determine the quality of work you receive. Don't assume that you can make a low-ball offer and get high-quality work in return.

Managing Freelancers Isn't Always Easy

If you're used to working with employees on your payroll, then you may be in for a bit of a shock when it comes to freelancers. While you can tell your employees exactly what to do and when to do it, freelancers have the freedom to march to their own beat.

"While working with freelancers can offer several advantages for small businesses, managing freelancers can also be a daunting challenge," cOutsource, a next generation outsourcing platform, explains to businesses. "Since freelancers work for so many different clients, as opposed to employees, it becomes essential ensuring they are on the same page about workload, deliverables, and deadlines. Things can get even more complicated when building freelance teams."

This isn't to dissuade you from hiring freelancers, but it is a reminder that they are "independent" contractors and don't have to abide by the same rules as your employees. You aren't their only client and you won't commandeer 100 percent of their attention.

Set Ground Rules and Enforce Them

In order to effectively manage your freelancers, you have to set ground rules from the beginning (and ideally put them in writing). This means clearly spelling out how many hours per week you expect them to work on your project, which tasks need to be met by which deadlines, how they are to complete specific work, etc.

You need your freelancers to take you seriously and creating strict rules and requirements will keep them in line. After you've developed a strong relationship with a freelancer and you feel like you're on the same page, you can obviously let up on these regulations and take a more relaxed approach.

Cheaper Isn't Always Better

You can find a whole lot of cheap labor online. Freelancers in other countries will often charge just 10-15 percent of what American workers charge, but this doesn't mean you should immediately outsource everything. When you work with international freelancers, you have to deal with time zone differences, language restrictions, and differences in business norms. Are you willing to pay that price?

Create Some Separation

Don't assume that you can just hire freelancers as a way of avoiding employees and saving money. The IRS is aware of various loopholes that businesses use and they are on the lookout for companies that violate the law in an effort to reduce benefit obligations and payroll taxes.

The most important test that the IRS uses to demonstrate contractor independence is geographical location. It's fine for freelancers to attend meetings at your office, but they shouldn't be performing work in your office or using your equipment.

Know What You're Signing Up For

Working with freelancers can be extremely productive and profitable for your business, but make sure you know what you're getting into. Your relationships with freelancers will be much different than your relationships with employees. Understand these nuances and make the right choices.

There's a lot to be gained from hiring freelancers, but you have to go about it in the right manner.

Published on: Sep 28, 2016
The opinions expressed here by Inc.com columnists are their own, not those of Inc.com.