Business is good—almost too good, which is something you never thought you’d say. After a few weeks or months of hard work, your startup could be generating enough revenue to keep you more than occupied. Eventually, you’ll find yourself unable to keep up with the workload, or you’ll discover responsibilities you didn’t know existed are being neglected, or your clients will be on a waitlist so long that they start dropping out.
At this point, most people consider hiring an employee (or multiple employees) to help shoulder the workload—but before you start hiring, there are some key things you’ll need to consider.
Before You Hire an Employee
Keep these things in mind before you finalize your decision to hire an employee for your business:
- Your workload consistency. Your workload is currently more than you can handle on a regular basis, but will it stay at that volume for the indefinite future? An employee is a long-term asset, so if your workload suddenly dries up, you could find yourself paying for help you no longer need. Think carefully about the type of work you’re facing (e.g., whether it’s retainer work, whether it’s seasonal, and other factors), and whether it warrants hiring an employee.
- Your needs. Next, try to formally articulate what your needs are. It’s possible to hire a general office assistant to handle miscellaneous tasks, but what would those tasks be? If your business is new, chances are you need a little bit of help in multiple areas, but which areas do you need the most help in, and how much flexibility will your candidate need to have? Make a list of all the required skills you have for your employee, and all the “wanted” skills you have for them before proceeding. It will help you write your job ads and filter out candidates when they start to apply.
- Your responsibilities. As an employer, you’re going to be responsible for many expenses and legal responsibilities related to your employees. For example, depending on what state you live in, you’ll probably need to pay worker’s compensation insurance. You’ll also be responsible for withholding certain taxes from your employees’ paychecks. Plus, if there’s an unfortunate accident on the job site—such as a wrongful death—you may be held liable for the damages. This could, in turn, affect your business insurance costs as well.
- Training and turnover. Some studies estimate that the cost of training an employee is more than $9,000. Depending on the skills you need, and your industry, that value may be significantly more or less—but training is always going to be a cost. You need to be prepared to spend the time and money getting those employees up to speed, and understand that it’s far better to keep one employee happy and working than to find a new one to train all over.
- Your appeal. If you’re still in startup mode, you may be less attractive to talented candidates who may otherwise fill your open position. You may need to compensate for that by offering extra perks, such as flexible hours, or even a stake in the company (instead of monetary incentives). What is it that makes working for your company unique, and how are you going to convince people that it’s worth it?
Alternatives to Hiring
If you find you aren’t ready to hire an employee, but you’re still struggling with an excessive workload, there are a few other alternatives you can consider:
- Outsourcing agency: Depending on what you need, you may be able to hire an agency to handle the work for you. Financial, creative, and marketing agencies, for example, could provide you with a monthly retainer fee or an hourly rate—giving you help without the need to hire someone.
- Independent freelancers & contractors: If you want to hire someone for short-term assignments, or hire someone for less money, you could look for an independent contractor instead of an employee.
- Work refinement: If you don’t want to hire anyone, you could make an effort to refine the work you’re currently doing, to better manage your time. For example, if you’re doing more work, you could increase your rate; that would filter out some less serious clients and earn you more money for every hour you spend. You could also fire problematic clients who take up a disproportionate amount of your time, or automate some of your job functions to free yourself up.
Dealing with too much work is a good problem to have—and fortunately, there are multiple ways to solve it. In many cases, the right way to solve it is an employee, but you need to know what you’re getting into before you pull the trigger.