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Taking on employees

Posted by Michael Bloch in ecommerce (Monday May 18, 2009 )

Adding employees is something I’ve resisted over the last close to 10 years, aside from a couple of admin support staff on a part time, independent contractor basis. Here’s why.

Basically, it can tie you down in a big way and cause major problems that you never had before, taking you in directions you never wanted to go in your online business or keeping you in a place you never wanted to stay – which is the opposite you want to achieve through hiring staff.

If you’re considering putting on staff and currently generating enough revenue to pay their wages, that’s simply not enough. You probably need to be sure you’ll make twice what you’re paying them for it to be worthwhile for you. Twice the average wage makes for a sizable sum.

Take a look at this list of the profit some big companies make on each employee. Google staffers make the company an estimated $210,000 profit *each*. That’s pretty incredible. Even at the lower end of the scale, Sun employees generate $12,000 profit each per year – but there’s 33,000 of them.

Once you have hired a person, then there’s the time it takes to train and the associated headaches that naturally come along with hiring humans – that’s important. You’re not hiring a piece of machinery you can use and abuse, but a human being with feelings and who is subject to the usual buffeting that comes with life. It’s a huge responsibility.

Then there’s the legal aspects. Skirting around the edges of the law with employment arrangements can be risky and staying within the law can be quite limiting.

Let’s say you wake up one morning and decide you want to go in a completely different direction. Whereas prior you may have been able to do so quickly, once you have employees, there’s the added pressure of any decision you make directly affecting them – remember, humans; perhaps humans with a mortgage and families.

The online world can be such a fickle place. If things start going bad, it doesn’t take long to chew through any nest egg you may have built up to keep paying your staff. There also may be a temptation to cut corners or market in such a way that would have been an affront to your business ethics prior to taking on staff. The road to online hell is paved with good intentions.

I’m not saying hiring people is *bad*; but it’s just something I think a lot of business owners don’t give due consideration to before messing with people’s lives and risking their own happiness.

Sometimes the price of taking your online business to the “next level” can just be too high and there is nothing wrong with staying small and perhaps making less bucks if it helps you stay in a space you’re comfortable in. Like I always say, get rich slow – and keep it.

The “Grow or die” attitude most of us are brainwashed with in regards to business is just plain bs – “grow or focus on a niche, or do something different online you equally enjoy” is far more accurate – there’s plenty of opportunities in so many niches for a nimble one-person show.


An alternative to staff – outsourcing


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