A note for entrepreneurs.
At some point you’re going to need help. That might mean outsourced contracts and services. Or it might eventually mean hiring employees.
It is best to start with a part-timer, for several reasons. Fulltime employees are very expensive. And I would recommend that you have enough profit or “spare” money in your business to cover an employee’s salary plus expenses before you hire.
A safe calculation is salary times 1.25. If you provide benefits, the cost will go up from there. You need to pay Social Security taxes of about six percent of salary. Plus worker’s comp, unemployment insurance, etc.
With a part-time employee, you can easily adjust hours when your cash flow changes. And don’t feel guilty about hiring people part-time. There are lots of people who only want to work 10-20 hours per week.
College students and stay-at-home parents are the best. They are educated and sincerely only want to work limited hours.
When it’s time to hire someone fulltime, please make sure that you have the cash flow to keep them. It is very sad and emotionally draining to have to lay off an employee because you didn’t have the money you thought you had!
Hiring your first employee is literally the greatest percentage growth your business will ever experience.
The very good news is that your new employee will double the number of hours available in your business. Maybe you will use those hours to sell services, or complete lots of administrative work. Whatever your new employee does, you will be able to expand your capacity.
I recommend that you hire an administrative assistant as your first employee. You will be tempted to hire someone to do your technical or primary work. That labor will probably be much more expensive than an administrative assistant. And an admin will free up your time to either perform the primary labor or make more sales.
More juicy info for first time entrepreneurs . . .
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Author: Karl W. Palachuk
Karl has worked with thousands of business owners and managers – and helped several of them make the move to self-employment. With this workbook, Karl will help you make the launch as well. This workbook is guaranteed to help you learn about what it takes to start and run your new business.