When Is It Time to Hire Your First Employee?

Life as a freelancer can be pretty exciting. You get to kiss goodbye to your boss, choose your own hours, and pick the projects that interest you the most – plus you’ll probably earn more, too.

However, as time passes and you secure more clients’ business, you might start to feel like you’re chained to your desk – in the same way that an employee is.

That’s one of the main problems of being a one-man freelancing operation: you are your business. Without you, it doesn’t function. Take a day off, and your business grinds to a halt. And that means no income. This shouldn’t come as a surprise, though; after all, we freelancers knew what we’re letting ourselves in for!

When you no longer have to worry about earning enough to put food on the table, those with grand aspirations may start to think about growth. Many freelancers are restricted by the fact that there are only so many working hours in the day – and do you really want to be working round the clock?

It’s at this point that you might feel as though the standard, one-man freelancing business model is not for you anymore – you’ve outgrown it. To continue expanding your business, you’re going to have to hire someone.

In doing so, you transform your humble freelancing business into a fully-fledged creative agency. This allows you to take on more work, plus it gives you the opportunity to market yourself in different ways.

Of course, taking on your first member of staff – whether in a freelance capacity or as a full-time employee – is a daunting step. For a start, it results in a drop in profits, for the short-term at the very least. If you’re looking to earn the big bucks, however, it’s a step you have to take.

In today’s post, I want to talk some more about this freelancing conundrum, as I discuss when the time is right to hire your first employee. Whether you’re a designer, developer, or writer, these points should still hold true – and even for those of you who freelance a million miles away from the world of WordPress.

1. You Have the Money and the Workload

This one should be fairly obvious: I wouldn’t even consider hiring my first member of staff until I was confident I had enough money coming in to cover my hire’s costs. If you don’t have a regular income – or your income fluctuates wildly each month – then you face the prospect of being left with little to no income yourself (or even negative income – yikes).

You should also apply the same logic to your current workload. If you commit to paying someone for, say, 40 hours per week, you will have to make sure you have enough work to delegate to your new team member. Fail to do so and your new recruit will be left twiddling his thumbs, and you will be left out of pocket.

2. You’re Turning Work Away

Your early days of freelancing will be spent trying to secure enough business to make ends meet. At some point, however, things will change, and you’ll find that you have too much work on your plate – admittedly a nice problem to have. This is an excellent opportunity to increase your rates, but you still might have to turn some work away due to a lack of time.

Turning work away is probably the biggest green light that it might be time to hire someone. By expanding your business’s capacity by hiring support staff, you no longer have to keep turning business away. More capacity allows for more clients, and that means a healthier bottom line.

3. You Want to Be a Business Owner, NOT an Employee

You have your own clients, your own branding, and you make a profit; that already makes you a business owner, right?

Well, yes and no. Don’t get me wrong; freelancing is a perfectly valid business model – and one that I employ myself. However, as any one-man operation will tell you, as well as being the business owner, you’re also the business’s only employee.

In other words, as a freelancer, you’re kind of in limbo between business owner and employee. If you started freelancing to escape the drudgery of your old 9-5, this is quite a depressing realization.

At some point, many freelancers realize that, to take the next step, they need to achieve a level of automation. They want to have the ability to step away from their business, and for it to still function without them.

Of course, the only way to achieve this is to hire additional team members.

This gives you the opportunity to take a break from your business while still collecting the profits – you can leave your new recruits to handle your outstanding workload. In my opinion, being able to make money without doing all the work is when you can make a clear distinction between being a business owner and being an employee.

4. You Don’t Have the Time to Do It All Yourself

Many freelancers don’t just complete a project then wash their hands of it. To develop a recurring base income, many freelancers will offer ongoing support after completing a project. Think of a WordPress developer offering a couple of hours per month of website maintenance for a fixed monthly fee.

Now, at first, that recurring income is a great way to break the feast-or-famine cycle. However, after building twenty- or thirty-something websites, those maintenance hours really start to stack up. It may get to the point where you haven’t got enough time on your hands to complete your bread-and-butter development jobs.

Faced with this scenario, many freelancers will let their ongoing support commitments fall by the wayside. This, of course, is hardly ideal if you want to maintain a beneficial relationship with all of your former clients.

If you just don’t have the time to continue supporting your existing client base, perhaps this is telling you that you need to hire someone else to cover this area of your business.

5. You Want to Open New Doors (Synergies)

Many tasks that freelancers do, while distinct, are also somewhat related. For example, if you work as a freelance developer for a well-established client, it’s not outside the realms of possibility that the client would want to hire a freelance writer and social media manager, too.

Perhaps you get the same requests from clients all the time – excuse me, would you be able to work on my website for 5-6 hours per month to make sure it’s properly updated and all the maintenance tasks are taken care of?

Rather than continually saying “no,” perhaps you could see this as an opportunity for you to expand the services you offer. And, even if you don’t have the time or skills to perform the tasks in this new area, you can always hire a specialist.

In doing so, you give yourself the opportunity to market your business in a completely new light — as a comprehensive, all-round service. This will appeal to a lot of clients, especially those who want to be as hands-off as possible. In other words, this new marketing ploy could help you secure more clients, or to charge a higher rate.

6. Your Profits Have Plateaued

At some point, and often following a period of rapid growth, all freelancers will experience a plateau in their business profits. Month after month of growth suddenly grinds to a halt, and nothing you do seems to take you to the next level of profitability.

When faced with a stubborn plateau, often the solution is staring you in the face. It’s time to bring in someone new to help drive the business forward.

Hiring a skilled staff member can help break a plateau and increase your bottom line in numerous ways:

• You increase your business’s capacity, giving you the opportunity to start prospecting for new clients.
• A new face can bring fresh ideas.
• There are different marketing opportunities for a “team” compared to a one-man operation.
• You can expand the services you offer.
• You can pocket a markup on the work done by your staff.

7. You Meet the Right Person

Sometimes hiring someone might not even register on your radar – until you just happen to meet someone with the right skills, attitude, and credentials to enhance your business. This is one of the major benefits of attending WordPress conferences – or the major events in your field of work.

You really never know what’s around the corner, and it pays to keep an open mind so that you don’t let a great opportunity pass you by.

Final Thoughts

While there are lots of indicators that the time is right for you to hire your first employee, the truth is there is no perfect time. Big business decisions like this always carry some degree of risk, so it pays to be prudent and proceed carefully.

If you’re at the point where you’re contemplating hiring someone, the timing probably won’t be far off – you’ve obviously realized there is at least some business need to grow your team. In such a scenario, my advice would be to consider a trial expansion by hiring someone on a freelance basis.

Hiring a freelancer gives you the opportunity to test out an individual with minimal risk, as you don’t have to commit to a long-term contract. If the trial goes well, by all means, offer that individual more work – until eventually, they work for you full-time. You can also start posting your talent needs on social media and create your own job board where freelancers (or those looking for something more) can find your jobs (contract, part-time, full-time) and apply to them. It’s better to have multiple people interested in your positions than only one.

And also remember: although it’s important to get the timing of your first hire right, it’s probably more important to hire the right person. If you’re faced with a weak pool of applicants, don’t just plump for the best of a bad bunch. Take your time, and wait until you find a person that’s the right fit for you and your business. Good luck!

Do you have a team of staff supporting you? When did you know the time was right to make your first hire? Share your thoughts in the comments section below!

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