It is important that small businesses get the timing right when hiring new employees. An employer should understand when to hire more employees as hiring someone too soon, profits can decline and cash flow can dry up. But it also important not to wait long to hire more employees as your commitments can outpace your capacity, so unfinished work starts piling up. An employer should hire more employees only when there’s enough work to demand additional help and the financial situation is stable enough to manage extra cost of a new employee. A business should also consider the hidden cost & expenses when hiring new employees, because an employer is entitled to provide health coverage, training program costs and more.
As small business owners, you may often worry about when is the right time to hire more employees. This decision might differ for each employer as some business owners feel the urge to hire an entire working staff in the early days of their startups; others feel more comfortable waiting until their businesses have experienced some initial success.
These four factors can help you decide when your small business needs to hire new employees:
Steady Growth –
If a business is considering bringing new employees, the first suggestion is to make a business plan for your business’s financial projections and reporting. In particular, examine your company’s revenue and compare it with your business plan to see how it has changed over time. A well-developed business plan will define clear milestones one of them being the point when you as a Founder can add more resources. If your business has been steadily growing as per the plan and meeting targets and revenues, it is a sign that you can consider hiring.
Business Expansion –
Growing your business means more clients and more clients’ means an increased workload. Relying on your existing workforce alone will lead to work overload. You’ll need to hire new employees so that they along with your current team can ensure that you are able to consistently deliver the same quality of services that your clientele expects. Combining your old and new employees creates a perfect opportunity for them to learn from each other and improve your business operations. An employer should approach a business consultant for such scenario to help you understand hiring strategies under such circumstances.
Overworked Staff –
Your employees are looking noticeably fatigued. It’s gradually affecting their performance. If you notice, higher number of sick days being used than usual. It’s entirely possible your employees are feeling the pressure, but they just don’t want to complain about the workload. If your employees are showing signs of being overwhelmed by work, it’s time to hire more people to ensure your best employees don’t jump ship. If an employer thinks that the current staff cannot keep up with the workload, it is best to hire new employees. A business consultant can help you identify which section or department is working to its full capacity and therefore in need of new employees.
Deliverables are Suffering –
If the current pool of employees is overworked, it is likely that your turnaround times for submitting work to clients is slowing down and the quality of work you deliver might even be suffering. If you receive more client complaints about delayed service or lower-quality service, you should hire new employees to help get the work completed promptly while maintaining a high quality. If you noticed that you are struggling to provide stellar customer service, it may be time to consider reaching out to a business consultant to assist in planning for new processes and increasing your staff. No business can afford to push away existing customers or neglect potential new ones.
In summation – adding on new resources is a critical decision which every small business faces. This should be done after the above considerations so that both you and the team can benefit leading to more business and more growth.
