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When to Hire Your First Employee
It can be one of the biggest decisions a small business owner will make, but it doesn’t have to be the most difficult one. Deciding when to hire your first employee (or additional employees for that matter) comes down to a few key factors: Work, Specialization, and Time.
First off, do you have the additional work needed to justify the hours you will be offering your new employee? Is there currently more work than you can complete in a given day, and is it causing you to turn away or lose jobs? If the potential for additional work is there, it may be time to hire.
Are there services or products you want to offer, but currently cannot do so due to a lack of specialty or training? Are you receiving complaints that products or services are not meeting quality expectations and you need an expert? It may be time to hire a specialist.
Be honest. When's the last time you had a day off? For a small business owner, the health of your business is intimately tied to your own well-being. So, what jobs can you hire out? Bookkeeping and administrative tasks? Maybe you're ready to hire and train someone to cover the floor while you take an actual day off.
A few final considerations. If you are concerned about making payroll, you may consider initially using contractors instead of hired employees. They are often less expensive, it’s easier to cancel a contract than it is to terminate an employee. It's also a good way to test run if your business is ready to expand to a staff. The other consideration is whether your organizational structure is ready for employees. Be sure to seek help reviewing the business entities that best accommodate organizations with employees and obtain guidance on the financial and accounting requirements for maintaining a staff.
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