When Should You Start Hiring Employees for Your Online Business?

Is it time to hire the first employee for your online business? 

If you’re a solopreneur making money online you might not have thought much about hiring. But as your business grows, you’re going to come to a point where you simply can’t grow any further without bringing permanent members of staff on board.

Here’s what you need to know about when to start hiring employees.

Four Key Signs You Should Start Hiring Employees

1. You’ve Already Hired Independent Contractors

The first time you pay someone to work for your business, they generally shouldn’t be an employee. Before you get to that stage, you want to have had some experience hiring independent contractors.

For instance, you might hire a graphic designer to create your logo. This is a one-off task, and you’ll likely pay a flat fee or hourly rate. This makes it far less risky than going through the whole process of hiring an employee.

You can also hire independent contractors for ongoing tasks. That could be a website developer to maintain your website, on a retainer basis, or a virtual assistant who works for you for 5 – 10 hours each week.

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2. You’re Turning Work Away

One of the biggest signs that it’s time to hire employees is when you’re turning work away. If you’re getting more business than you can handle, then it’s time to bring someone else on board to take care of some of it.

If you’re the only person working for your business, then your business will always be limited by how much you personally can do. When you hire others, your expenses will increase—but so will your profit. 

It’s easy to fall into the trap of thinking that only you can do the work to your high standards. Even if someone else only does 80% as well as you, that frees you up to just finish off the remaining 20%.

3. You’re Getting Customer Complaints

Another sign that you need to hire employees is when customers are complaining. Perhaps you shipped a defective product or you provided a service that was sub-par.

If you’re stretching yourself too thin, that’s eventually going to show … and it’s going to result in dissatisfied customers.

Bringing on board other members of staff, or even customer service representatives, can make a huge difference in keeping your customers happy.

It can cost five times more to acquire a new customer than to keep an existing one—so instead of investing all your efforts in getting new customers, focus on retaining the ones you already have. 

4. You Want to Bring More Tasks In-House

Another great reason to hire employees is when you want to bring more tasks in-house. Maybe you’ve been paying more and more to independent contractors to handle things for you that could be done more efficiently and cheaply by employees.

It’s worth making a list of all the tasks currently being handled by contractors or agencies so you can figure out what job roles these might fit into. For instance, you might have lots of different admin jobs that could all be covered by an office manager.

Four Questions to Ask Yourself When Hiring Employees

Hiring your first employees can feel very daunting. Here are some key questions to consider as you prepare to bring new people on board.

Hire Team Members

1. Are You Prepared to Handle Payroll and Pay Stubs?

When you pay an independent contractor, you likely get an invoice for them and then settle up. You don’t need to worry about anything like withholding taxes, as that’s their responsibility.

As an employer, you need to deal with running payroll each month and providing all the necessary paperwork such as pay stubs . You can use a paystub creator or similar to help with this, or a full online payroll system. There are plenty of tools that can help … but you do need to be willing to look into the best solution for your business.

2. Do You Know What’s Legally Required of You as an Employer?

As an employer, you’ll be expected to meet certain legal requirements. Depending on the size of your business and the state you’re in, you’ll likely need to have workers’ compensation insurance, for instance, in case an employee is injured on the job.

You’ll also need to handle paying payroll taxes and other taxes to the government. 

When it comes to hiring, there are certain legal rules you need to stick to. For instance, you can’t discriminate against people who are disabled or pregnant. You also can’t discriminate based on someone’s race. 

3. Where Will Your Employees Work?

Before you begin the hiring process, you should think through where your employees will work. Many online businesses let employees work remotely—and some businesses are remote-only, without a physical office. 

If you do have an office, you’ll need to make sure you have space for new employees to work there comfortably. You’ll also want to consider whether you’re going to require employees to work there 5 days a week or whether they can work remotely some of the time.

If employees are going to work remotely, you’ll need to consider what technology you need to put in place. This could be as simple as creating Google Drive and Slack accounts for your employees. You might also want time tracking software to make sure employees are actually working while on the clock.

4. What Benefits Can You Offer?

As a small business, you may not think you can offer much in the way of benefits. It’s important to look into your options, though. If you want to hire high-quality candidates, you’ll need to be able to offer a reasonable benefits package.

Beyond benefits like health insurance, think about offering extra paid leave, flexible working, or similar. If you run a SaaS business, you could provide employees with free access to your software for their personal use. 

Hiring employees is a huge step for your business—and a really positive one. If you’ve taken your company from a side hustle to the point where you need to hire people in order to grow further, that means your online business has been truly successful. 

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