Hiring employees: Is now the right time?
Ask yourself these seven questions to determine whether you're ready to expand your team.
1. Are you turning down work?
If you're regularly declining projects, or you've missed deadlines, adding an employee may help you increase your bandwidth and capabilities.
2. How much time do you spend on administrative tasks?
As your business grows, you'll need to prioritize building relationships with customers and making strategic decisions. A less experienced employee can handle tasks, such as answering phones, freeing up your time for these principal responsibilities.
3. Are you prepared to delegate responsibilities?
If your current leadership style has you firmly in control at all times, it may be difficult to let go of tasks you've always completed on your own. Ask yourself if you're ready to trust an employee to shoulder part of your workload.
4. Can you fill the role another way?
Not every small business owner needs a full-time employee. You may be able to outsource tasks, hire an independent contractor, or use a temp agency to fill a short-term need.
5. Can you identify a new revenue stream?
Hiring an employee with a complementary skill set may allow you to provide new services. A graphic designer, for example, might team up with a website developer to improve offerings for customers.
6. How much can you afford to pay?
As an employer, you're responsible for more costs than just your employee's salary. You may need to cover payroll taxes, unemployment insurance, and health insurance. You also may need to provide additional workspace and supplies.
7. Are you willing to handle paperwork?
Hiring an employee means meeting ongoing legal requirements. You'll need to create an employer identification number, set up records for withholding taxes, and verify employee eligibility. Depending on the laws in your state, you also may need to purchase workers' compensation insurance.
Learn more about preparing for a new employee.