How to Know When It’s Time to Hire An Employee

Pretty much 75% of the time, small business owners carry the weight of all departments of the business to keep it afloat and running. Sales, marketing, operations, finance, customer service – yup, all on one plate.

Most small business owners, especially those who are bootstrapped, have this fixed mindset that subconsciously says “I can do everything and I don’t need any help” or “I can’t afford help.”  Well, this thinking could be what’s keeping you stuck where you are without growing as fast as you’d like. Success requires growth, and growth requires people. It’s just the way it is.

3 Signs It’s Time to Hire an Employee

Still, entrepreneurs should be practical and know exactly when it’s the right time to hire help. You can’t just decide one day that you’re too tired and you want somebody else who you can delegate to. If you do, you’re bound to make mis-hires that can cost you lots of time and money down the road. There are things you must consider.

Here are three signs that it’s time to consider hiring an employee (or two):

#1 Your team is flying around trying to keep everything together

Do you notice some of your team members getting frustrated because tasks seem to pile and pile, and they’re doing some tasks that aren’t even within their job description?

Well, the reality of having a small team is a long, endless to-do list – and usually, less hands to help and delegate to. As your business grows, responsibilities pile up. You need to have someone who manages your marketing, sales, and customer service to start. You can’t possibly oversee everything in the business when it’s becoming bigger and getting more clients.

When I hired my first employee, it was because my business partner had a lot of demands from our clients while we try to keep the marketing and operations of the business smooth-sailing. We were gratefully pressed to expand, and we needed someone with experience to manage our expansion. Before we hired her, expectations from both sides were discussed and it helped make the business reach to even greater heights.

#2 You find yourself struggling to keep your clients happy

Your business was manageable with a client or three. However, now that you have many leads in the pipeline and five clients signed, you’re struggling to make ends meet when it comes to giving quality client deliverables. 

I have experienced this first hand – some days, many of our clients needed more temporary employees, and recommendations of our service were flinging left and right. And so, we needed to onboard another employee, even if at the start there were lull days and there was no work for her to do. But we had the profits to keep that employee on the payroll, so it was all right.

Keeping your clients happy is key to growing your business. Happy clients mean revenue AND free referrals through good word of mouth. Great job if you’re gaining clients and giving your best effort to keep them satisfied! Working long hours to give them the best service is a small problem you can quickly solve.

#3 You find yourself AND your team always, always stressed out

Stress is normal in every business, but it shouldn’t mean that you and your team have to be at wits end every single day. At the end of the day, having a business means that you have the freedom to enjoy all your hard work – and so should your team.

As I mentioned above, when a business grows, responsibilities pile up with it – and your small team may not be able to keep up. Stress can burn out the team, and burnout means less given quality for their work. 

You have to think of your company – don’t you want to ride the trend of your business growth or settle with where you are now? There are just so many tasks each member of your team can handle. Dealing with too many responsibilities can stress them out and be counterproductive to your company.

If you recognize that any of these situations is currently happening to you, then it’s probably in your best interest to hire an employee. But wait! As I mentioned earlier, you have to be methodical about it.

Are YOU ready to hire an employee?

Before you post a job ad, we have to do a reality check.

Does your business generate enough revenue to pay for an employee? Can you afford adding a liability?

Every time you onboard someone in your company, it is an opportunity to grow your company, but it is also a huge liability. So you have to make sure that you really need someone to help you in your day-to-day work. Hiring someone means an added responsibility of providing them a steady paycheck. You have to pay for their hours and skills. This will affect your profits – can you afford it? Does your business have a steady cash flow that can pay for an employee for at least 6 months?

What kind of help do you need?

You need to know the exact kind of help your business needs for growth and support. This way, you can hire the right person on the right seat, and will move the business upwards. 

You need to know what their job will entail. Do you need a freelancer? Or do you really need a full-time employee? Make sure to understand the laws in your state and country about independent contractors – which is often ignored in startups and new businesses but can really come back to damage you if you misclassify them.

Don’t just hire for a title – for instance, “Virtual Assistant”. Instead, hire based on what you need done. Create a mission statement for the role and include expectations, so applicants will know on the get-go if they are a right fit. And once they are onboard, new hires will know what your business success looks like, and how their role fits into the mission of the company.

At the early days of my coaching business, I hired an Online Business Manager because I was excited. It was way too early to get that employee onboard because I also wasn’t clear of what I needed and where I wanted the business to go. Because of that, I needed to let that employee go as even I did not know what specific outcome I wanted to get out of that partnership. I took a step back and had to be clear with myself about what my mission and vision were for the business.

You might also like: 3 Steps to Hiring the Right Person for Your Team

Final Words

As a small business owner, part of growing your business involves hiring people to help you move the company to further success. However, there is a mesh between the need to hire an employee and having the means to add this liability. You have to know exactly if there is a gap that needs to be filled by someone else. Plus, you also need to check your cash flow if you have the budget to onboard a person in the business.

Need help putting together a solid team? Take a look at my Total Team Makeover course.