Before you even think about hiring staff, you need to consider these questions:
How will the extra person make your business more productive and profitable?
What sort of “hidden” costs will be incurred, such as recruiting, advertising and training?
Will the initial outlay be a long-term benefit or is it justified for the short-term, such as casual staff?
How much of your own time will be spent supervising the extra person?
Are you able to take advantage of any government subsidies to offset the costs of training?
Can you take this person on as an apprentice or trainee and what will that mean in terms of training commitments and subsidies?
What cash reserves will you need to meet the wages and other costs until the employee is fully productive?
Are you aware of all the operating costs which are added to wage costs, such as superannuation, workers’ compensation insurance and leave loadings?
Does taking on an employee mean that you will have to upgrade your premises to meet Occupational Health and Safety regulations and codes?
What other costs will you have to incur to provide physical accommodation for an employee, such as work stations, ramps, plant and machinery, motor vehicle, tools and manuals?
Can You Afford It?
Employing staff costs money, so it’s important that you’re fully aware of how much money you have available to pay any staff and how much you’ll get back in return through increased sales.
If you believe you will have more work than you can handle alone, then you should consider whether a casual staff person can help, especially if the extra work is seasonal or short-term.
Another option is to employ someone to help you with the administrative work. Then you can devote more time to the core business tasks.
When assessing staff costs make sure you realise the cost involved isn’t just how much you pay a person, it’s also items such as providing a safe working environment, superannuation, leave and workers’ compensation insurance.
Sit down with your accountant and make sure you have your sums right. There’s no point in employing staff if you won’t get sufficient return from their work to make it worthwhile.
Preparing to Hire
If you plan on starting your business as a one-person operation list the tasks you will need to undertake to run the business. Include all of the work involved in running the business, such as financial management, equipment maintenance and advertising, as well as your core business activities.
Don’t forget to include any “outside” work you will have done by professionals such as accountants.
This will help you to assess if you can manage all the needed tasks by yourself or if you will need help.
If you plan on employing staff from the outset, you should include what their tasks will be as part of your job role planning.
Once you’ve written down all the relevant tasks, identify the ones that are most important and which are the least important to the success of your business.
Now grade the tasks by responsibility. This is the “hard” part. Here’s where you start to think about what you can and can’t delegate to others.
There are some things, however, that you just can’t pass off to someone else. These include making decisions about the direction of the business, overall financial control and marketing strategies. These are the core management tasks. Mark these on the list.
Next, write down the tasks which are not essential functions for the control of the business and which you can easily delegate to someone else.
Finally, allocate how many hours per day or week you anticipate will be spent on each task.
Once you have filled in all the information, you’ll have a better idea of what tasks will make up your business, what’s most and least important and how long the different tasks will take.
The different tasks can be arranged into groups which could correspond to a person filling a particular role.
How crucial they are, and when and how often the different tasks are performed, will guide you in working out whether you will need a full-time, part-time or casual person.
