"Hiring Your First 'Employee' For Your EBiz"
What happens when your Home-based EBiz gets busy enough that you no longer have time to run it yourself?
(NOTE: I am not an Attorney, I have no plans to become an Attorney, and any information you see in this Article is my personal opinion, and is not to be construed as legal advice of any kind. Please do not act on any legal aspect of your business based on any personal opinion of mine mentioned in this Article. You must consult an Attorney and an Accountant for the correct legal interpretations in your area.)
There are only so many hours in a day. When you're running your own Home-based EBiz as a "one-person show", chances are you're still working your Day Job to bring in the regular income used to support yourself and your family. If you DO have a family to support, it's even more important to keep the Day Job until your EBiz income can be fully counted on to take over that role.
At the same time, you're knocking yourself out more and more during your off-hours, trying to build your EBiz. Marketing, researching products, handling Customer Service, filling orders...it all adds up as you get busier! That ends up costing you your remaining free time, quality time with your spouse and kids, and so on. The more successful you become, the less time you have in your life for anything but work.
Funny, when you started your EBiz, the plan was to be able to work or yourself from home and have MORE free time, wasn't it? :o)
Well, the same thing happened to me when Worldwide Brands began, many years ago. I've seen it happen to others we work with online, and see it happening right now to someone we know well whose business is really beginning to take off.
So, what do you do?
Well, the obvious answer is that as your EBiz gets to the point where you have no more time in the day to grow it, you need help. You need to keep driving the business and pursuing the creative, marketing and decision-making end yourself, but you need someone to help fill orders, answer emails, help with Customer Service, etc.
Some people are lucky enough to have family members who can pick up some of the slack. That, of course, is your least expensive option, since you generally don't have to pay members of your immediate family a lot of money! You're all in there pulling for a common cause (supporting the family) and if you have a spouse or older children who can help, you can generally get away with claiming that you need the (free or very cheap) help for the benefit of the family. With teenagers, you may find that you need to pay an increased allowance. :o)
Many Home-based EBiz Owners, however, don't have this little luxury, which is really no more than a stop-gap solution anyway.
If you really plan on making a good living and growing your business to the point where you can live very comfortably and retire early on it, you're eventually going to need to bring in outside help.
There are three ways you can do that.
1. Bring in a Partner. You're going to find, if you approach people you know for this kind of day to day work (good friends, for example), that they're probably going to ask you for a piece of the business in order to work with you. Personally, I would not recommend doing that for an online product-sales EBiz. There's really no point in giving away a part of a business that you created and built to a point where it's growing enough to need the kind of clerical help we're talking about here. Partners are not for clerical help; you bring in Partners for very specific professional needs that you can't fill yourself.
2. Hire an Employee. If you are actually going to hire an employee for your business, you're going to find that there are a tremendous number of legalities to consider. First, you absolutely MUST become Incorporated. Then, there are all kinds of standards and practices you need to learn about and stick to very carefully so that you don't get yourself in legal trouble if you miss some form you should have filed, or some state-mandated employment practice that you didn't know about. Then there are all kinds of extra things you need to pay for, not the least of which are tax liabilities and unemployment insurance. Personally, my opinion is that hiring employees is something that you should only do when you REALLY begin to expand, well beyond the need for just one or two people to help out. When you do eventually get big enough to hire "official" employees, I recommend using one of the better "Co-Employment" services that are out there. They charge you a set fee per month, and handle all the legal issues, hiring and firing, policies, payroll, etc. Great way to go, but this should be reserved for the point when your business becomes a larger concern that needs to be staffed by multiple people.
3. Contract for help. In my personal opinion, this is the best way to bring in an extra person to help you run the day-to-day activities of your business. When you contract with someone to help you, THEY are the "contractor", and are responsible for all the legal aspects of the work relationship. Let's say your buddy Joe has enough free time to handle the extra work you need done, and is interested in doing it for a certain dollar amount per hour. You would say, "Joe, I need you to go get your own DBA (business name and license)". Then I'll pay your Business a certain number of dollars per week, and you perform the services for me that we agree on. This is basically the same thing as hiring someone to do some repair work on your home. If you need some electrical work done on your house here in Florida, for example, you're not allowed to do it yourself. Someone who is licensed by the state, and carries all the appropriate insurance, etc., must do the work, or you are in violation of the law. So, should you go out and spend a tremendous amount of time learning how to be an electrical contractor, take the licensing exams, file a business name, and do the work yourself? Or would you rather just hand a check to someone else who already has a business, and have them do the work? In that way, THEY are responsible for all their own liability issues, NOT you. So, you can bring someone into your business to work or you as a CONTRACTOR, and simply write them a check each week. All they have to do is go get a simple business name and license, which is not time consuming or expensive. They are then responsible for all their own tax issues and other concerns.
Of course, as I stated at the beginning of this Newsletter, this is all my personal opinion. I've done all of it, from being a Contractor, to hiring a Contractor, to hiring full-time employees, and I'm passing this info on from personal experience. Before you do anything suggested in this Newsletter, you should consult with an Attorney to make sure you follow the letter of the law where you are.
The ultimate goal of most Home-based EBiz Owners is to expand and grow to the point where your business is a profit center that WILL allow you to retire comfortably someday, and very few of us ever get to that point alone. Just be sure that when you DO bring on help, you think about it carefully, and do it in a way that helps your business by providing more benefit than cost.
Chris Malta
Founder/CEO
Worldwide Brands, Inc.
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