One of the most exciting milestones for an entrepreneur is the decision to hire an employee. The shift from doing everything yourself to paying someone to take on part of the workload (especially if it's the part you don't like) can be liberating, empowering, and business-boosting. It can also be scary, particularly if your financial margins are tight.
In fact, for many small-business owners, the most stressful part of bringing on a new staff member is finding room in the budget. Here's a guide to help you determine whether it's time to hire your first staff member - and how to make it work financially.
Signs It's Time to Hire an Employee
Classic signs that your business needs a second worker to keep it strong and help it grow:
- You've got more work than you can handle - and you're starting to burn out from juggling so many projects.
- You've begun receiving complaints from customers because you either can't complete work quickly enough or the quality of your work has started to slip.
- You've had to turn away work because you just don't have time to complete it.
- You're behind on bookkeeping, paperwork, or documentation - and it's starting to become a problem.
Finding Room in the Budget to Hire an Employee
Once you've recognized that you need some help, it's time to figure out how you'll pay your new hire. Depending on the position you need to fill, you might find some of the following useful…
- Hire an intern. Lots of talented college students are eager for real-world experience, especially given current economic conditions. If you choose to go the intern route, though, make sure you adhere to the federal government's internship guidelines.
- Hire a part-time worker or contractor. If you're not ready to bring on a full-time employee (and pay the attendant taxes and insurance costs), consider a 1099 contractor. As with interns, though, the government regulates what employers can and cannot expect from contractors.
- Hire a remote employee. A virtual assistant or contractor lets you continue working from a home office while expanding your workload capabilities. A remote employee is a great halfway step between sole proprietorship and a fuller team.
- Work on a temp-to-hire or project-by-project basis. While this means more uncertainty for everyone involved, it also lowers the stakes for making the wrong hiring decision. Plus, if your workload slows in the near future, you aren't committed to providing this worker with a steady paycheck.
- Consider small-business grants and loans. Programs from government groups, nonprofits, and corporations offer growth opportunities for small businesses though grants, loans, and equipment gifts. An online search should reveal whether your business is eligible for boosters that could help you grow.
Following the Hiring Rules
When you finally take the plunge and bring on a new staff member, be sure you maintain compliance with workplace regulations, tax requirements, and safety protocol. This Small Business Administration guide outlines the most important regulatory hurdles you'll have to clear.
Writtten by Brenna Lemieux - check her out at Google+ or Twitter