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Fulton Bank
Fulton Bank

Business Growing? Tips on when to hire a new employee

The decision to add employees to your small business is a big leap (usually forward), not only adding to your workforce, but also freeing you up to build the business. Hiring someone with different skills also helps build your capability.

Many businesses don’t have the immediate cash flow to cover an extra salary, and it can be a leap of faith to take on a new employee. 

But if you have you reached the point where you can't keep up with the demands of your business, it may be time to hire more staff. 

Signs you’re ready to hire 

When your business is succeeding, you're bound to hit your personal capacity. No matter how hard you work, or how many hours you spend on your business, there's only so much you can do on your own. 

The following circumstances are good indicators you need extra help:

  • You're getting more orders or more customers than you can manage, it’s taking longer to fill orders, or you’ve seen an increase in customer complaints over delays.
  • Administrative tasks are overwhelming and are cutting into the time you have for income-generating work.
  • In addition to the usual bookkeeping and customer invoicing, you might also need to spend time ordering stock from suppliers, managing stock levels and completing customer-related paperwork.
  • You’ve started to say ‘no’ to new work and you’re missing new business opportunities.

Take these steps if you think your business is ready to hire.  

1. Risk reduction options 

If the cost of a new full-time person is too much, part time or contracting are options that can be more cost-effective, depending on the workload and type of work. 

Other ways to reduce your risk of adding an extra salary include:

  • If you only need a certain amount of time each week, a part time employee can provide the extra help you need without the commitment. 
  • Using short-term employees if your workflow is unpredictable.
  • If you have a specialized project-oriented need, a contractor might be a better approach.

2. Calculate the total cost of employment

Employees can be a significant expense to a business, so it's important to work out their total cost of employment to be sure your new employee will add to your total profit. When you're deciding on what sort of person you want, think about your long term goals for your business and how a new employee can help you achieve them. 

Employment costs may include some of the following:

  • Their salary or wages.
  • Your contributions to insurances and any employee benefits, health insurance etc.
  • Equipment required for the job (computers, vehicles, uniform).
  • Recruitment and training.
  • Contribution to things they need on the job, such as a vehicle or phone.

3. Calculate the potential

When you're on your own, your business is all about achieving results through your own efforts. With an employee, your business changes and it becomes all about achieving results through others.

That can be a challenge for business owners used to working solo, but without people, your business will only ever be as big as you.
Your employees can help expand your business and bring in more revenue and more customers. Over time, you can grow to the point where you feel confident that your team knows how to run things efficiently on their own. 


At some stage you’ll need to take a deep breath, take the plunge and hire a new employee. It can be scary, but it’s also one of the most worthwhile and rewarding things you will do. Employing others and helping them build a career and support their family is a big responsibility. But in return they will contribute to your business success and profit, allowing you to take on the next employee.



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