Start with the Money
If we truly simplify the question of whether it’s time to hire your small business’s first employee, it comes down to one major factor: cash flow. Because, in the end, no matter how overwhelmed you feel or how many hours you work, if the money’s not there, hiring might not be the right move — or even possible…yet.

But let’s drill down a little. Hiring your first employee isn’t just about affording a salary. It’s having enough regular revenue to confidently commit to paying someone else — not just once, but consistently and without fail. It also means being ready to invest in your business's long-term growth, because hiring your first employee also brings compliance with laws and regulations, insurance and more.

According to a study cited on pnc.com, as many as 82% of small businesses fail due to cash flow problems. So, before hiring, it’s not just about whether you want help but also if your company can sustainably afford the full cost of an employee: salary, payroll taxes, benefits, training, tools and time.

Look at the Signs
The good news? There are financial and operational signs that indicate it is time to bring someone on board.

The cash may be flowing, but perhaps not enough. Maybe you’ve begun regularly turning down work simply because you can’t keep up — leaving potential income on the table. Or you’re spending so much of your time buried in administrative tasks you don’t have as much time to focus on the revenue-generating side of your business. This is what we might call a “happy problem.” It means there’s demand, and with the proper support, you could potentially take on more clients, serve them better and increase your bottom line. So, the question then becomes: If you had help, could you grow?

Are Quality and Customer Service Slipping?

If you have an overwhelming workload, how is it affecting your end product and/or customer service? Suppose you start missing deadlines because you can’t keep up. This leads to your customer service suffering and may result in poor reviews, negatively affecting your reputation, business and cash flow. Whereas if you onboard your first employee — even at part-time status — could you prevent your work and client satisfaction from suffering?

Don’t Overlook the Hidden Cost: You

Another often-overlooked cost of doing everything yourself: you.

As a small business owner, you’re the engine behind everything — sales, service, marketing, customer experience and administrative tasks. While most small business owners tend to wear all their company’s hats, it’s not sustainable forever.

When you stretch yourself too thin for too long, it will affect your business. You likely started your company with nothing but a twinkle in your eye and passion for your product or service. But if that twinkle or sense of joy diminishes, you may become less motivated, efficient and profitable. In this situation, it may be time to run the numbers and see if you can financially sustain bringing on an employee to assist with your operation.

Timing is Everything

Of course, timing matters. Bring on an employee too soon, and you might find yourself skipping your paycheck to fund theirs. And that’s a fast track to burnout or the resentment referenced above.

Be Strategic

Hiring your first employee is a big move and decision you should make with intention, thorough analysis and strategy. Feeling overwhelmed isn’t enough on its own. You need the numbers to back it up and systems to support it.

If you're at the point when demand is outpacing what you can handle and where quality or customer experience is slipping, it’s time to take a step back and look at the big picture. Could the right person help you grow your business?

Run the numbers. Assess the risk. The right hire can be the boost your business needs.

If you found this article informative and helpful, visit americanbusinesscoalition.info to learn more about how the American Business Coalition can support you.

Articles in this newsletter are supposed to be informative, enlightening and helpful to you. While all information contained herein is meant to be completely factual, it is always subject to change.

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All this deserves more than just a glance at your bank account