My buddy always says that you get what you pay for. This is simply not true. In my experience, if you hire the cheapest service providers in any realm, you will be very disappointed in one way or the other. They could even do damage. If they do passable work, they might have terrible personalities or be unreliable. If they are nice, then their work might be horrible. How do you get the best of all worlds? Sometimes it is not possible, but you can optimize.
High-priced service providers are not always good, but at least the possibility of them being good is much higher than with their low-priced alternatives. I have learned that expensive providers in any field are rarely perfect, but if real people are really paying them their really high rates, then that speaks for itself. Some people who are worth $50 per hour might quote a rate of $100. They might just be cheating you. Be cautious with ANY service provider no matter where they are, no matter how much you like them, and no matter what they charge. There are pitfalls with any type of providers. If you want a top notch provider, searching higher priced providers first will yield you a higher rate of return finding the best providers in town — but you still have to weed out a lot of people — perhaps up to 80%.
What about mid-priced providers? Recently, I have had excellent luck with mid-priced providers. The communication wasn’t as seamless as with their higher priced counterparts, but adequate. And the type of service I got was top notch. I used to get massage from someone who charged the higher price in town. She was excellent and had a lifetime of experience (a long life of 78 years too I might add). Then, I found another provider at half the price who was equally good. The communication skills were not as good, and the others at the same location were not as good — but, I only need one provider, and she is generally available.
I also found a great software house that has a top notch boss. He charges more for outsourced programming than most other companies. He is in the $45 range with a team in India. Most companies in India charge $20 with a few charging $25 or more. There are a handful in the $40 range and a few companies with their heads at fancy companies in the U.S. who charge up to $90. So, $45 is in the mid-range for India. But, his quality of work was flawless. Other companies in his price range left me high and dry, but he delivered timely and accurate results. I didn’t find him by guessing, or by accident, but by scouring the market to find good people.
So, when you do your market research for service providers for data entry, software, call center services, KPO, etc., remember this thought: If you want to save money, be careful of these cheap companies. They can destroy you. If you want to pay too much and have the illusion that it will get you quality — think again. I strongly recommend to all parties to start your search with medium priced providers and then compare their price : value ratio to whomever else you are thinking about!