Business

When to Hire Your First Employee vs Stay Solo

Nov 24, 2024 • 6 min read

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You're turning down work. You're exhausted. Should you hire? It's not always the right move.

Signs You're Ready

Consistently turning down profitable work. Working 60+ hour weeks. Your health or family is suffering. You have 3+ months of cash reserves.

Signs You're Not Ready

Inconsistent work flow. Cash flow problems. Haven't raised prices recently. Don't have systems in place yet.

The Math

An employee costs more than their wage. Add 20-30% for taxes, insurance, workers comp. Can you generate enough extra revenue to cover that plus profit?

Hire vs Subcontract

Subcontractors give flexibility but less control. Employees cost more but you train them your way. Start with subs to test demand before committing.

What You Need First

Documented processes, quality standards, training materials. If everything is in your head, you can't train anyone effectively.

The Alternative

Before hiring, ask: Can I raise prices? Can I work more efficiently? Can I turn down low-margin jobs? Sometimes staying solo but more profitable is the better path.

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