Here are some simple things to consider when you are making a decision on when to hire your next employee:
1) Work out how many extra sales it will take to cover the wage of that employee.
To do this, you need to know your margin after considering the costs of delivering your products or services and the cost of new employee. Based on this what is the extra sales per week or per month required to cover their wage? It is important to know that number so that it gives you an idea of how easy or difficult it will be to cover the extra amount. We have a simple calculator we use in Biznostics that help you do this.
2) Work out if you can afford half of their wages.
Business owners often wait until they know they can cover all of a staff’s wage. If you know that your business can cover half of their wage, have faith that they will cover the other half by the extra capacity and returns they will bring to the business. Think about the positive things behind hiring that next staff. If it is going to free up some time for you to do other things you’re best at in your business, then it should be financially beneficial for you in the long run.
3) Have a buffer.
Don’t just take a new employee on and put all your spare cashflow into this employee. Consider having a buffer. A rule of thumb is to put 3 months worth of wages set aside, and this will give you three months to bring them up to speed. During these three months, you can see them through their probationary period and train them to be productive. If they do not work out within those three months, you would have the money you have initially set aside and so will not make or break your business. You would not have to worry if you have put a buffer in place.
4) Think differently about how you bring other people into your business.
This could be a simple as hiring a casual employee, a part-time, or a contractor; not necessarily a full-time staff. It is about getting that extra help that you need; extra hands, extra feet, an extra mind.
Think of how hiring your next employee can help free up some time that can enable you to focus on other parts in your business.
P.S. Whenever you are ready here are 4 ways we can help you build and grow your business:
1) Download your copy of 3 Proven Tactics That Give You 5 Hours Back in Your Week
This totally free guide includes tips, time-savers, and expert advice on how to immediately claim back 5 hours of your time each week. Inside you’ll discover 3 proven tactics to stop time being wasted in your day so you get more done each week. To access the guide click here
2) Watch the Business Freedom Formula Video
In the video you’ll to discover the step by step blueprint we use to help small businesses create their version of business freedom. This could be simply streamlining your business so it runs more efficiently, increasing your profits so you have more choices or setting your business up so you can have time off without worrying that it is all going to fall apart. Click here now to watch
3) Book a 10 Minute Exploration Call
If you would like to explore how Biznostics can help you run and build your business, then book your 10 minute exploration call. On the call we’ll find out a little bit about your business and work out if and how we can help you. Book your call here
4) Join our Business Freedom Program
The Business Freedom Program is designed for business owners who feel stuck in the day to day running of their business and their business is not running as efficiently as they like. It helps you make your business much more profitable, much more efficient and much more enjoyable to work at. We are putting a new group together next month so if you would like to build a strong and successful business email us here with ‘Business Freedom’ in the subject line.