I have long had a problem with firms that "farm out" research projects in this manner. While it is an expected competitive outgrowth, it has a few potential pitfalls.
To illustrate one problematic area, let's use this example:
Homeowner pays ABC Abstract $250 for a title report, since he's seeking a zoning variance for an addition to his home (his city requires a title report to grant the permit).
ABC sends the order to XYZ Research for $150. XYZ Research has offered researchers in Abbazaba County, Arkansas a bulk contract at $40 per lot for 60-year work.
The end client who is the Homeowner is not getting $250 in research work. He is getting $40 worth of research work down-line.
This situation is part and parcel to the reason that India's data firms are getting traction in our market; we've created a middle-management industry that takes a "cut" at each level. The economies of scale and internet-age technology allows us to create these middlemen firms.
I've ranted against these sorts of contracts before. I prefer to deal with the end client directly and I do not let my firm become involved in such projects. The only exceptions to this are "friends" in the industry whom I will take a quick project from and do it for free to help them out. Otherwise, the time in travel, cost of documents, and amount of time spent billing $40 for a project that would cost me $70 to do is insane economics which don't add up.
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