How to build a team so your business can grow
When I started my first business, I didn't do it to be a boss. But as my business grew, I was the one spending hours going to the post office, inputting data, paying bills. Those day-to-day tasks had to get done, but they didn't bring in more money or clients or make me happy. Hiring my first employee was a great decision — it helped my company grow and I grew as a person.
Where do you see your small business in a year? Five years? You almost certainly want it to grow. But you can't do it alone. As part of my Small Business Week series, "Make This Your Year to Grow," we'll focus on a fundamental growth strategy: building your team.
For many businesses — especially the smallest — building a team doesn't necessarily mean you have to hire employees. Even "sole proprietors" need support. Before I hired my first payroll employee, I began with advisers and consultants, then used contract workers from time to time. Occasionally, I teamed up with other consultants to offer our services to clients as a package.
Your team can consist of:
• Full-time or part-time employees
• Permanent or temporary employees
• Contractors, consultants, professional service providers
• Advisers, advisory boards
• Strategic partners
For most small businesses, however, building a team means hiring employees.
Marcia St. Hilaire-Finn had no choice but to hire if she wanted to grow her day care business in Washington, D.C.
"When I started, I had one employee," said St. Hilaire-Finn, owner of Bright Start Child Care. "I had five kids … In child care, you can only have so many children for so many employees. To expand, I needed more people."
When it came time to hire, St. Hilaire-Finn took a different approach from most day care centers and many small businesses. Typically, they hire the least expensive help they can find, figuring that's the way to keep prices down and profit margins up.
"My premise was to create an 'academy' — getting kids ready for school," St. Hilaire-Finn said. "So I looked for people who had training in preschool education … I usually go to universities that train people in early childhood education to find employees."
To attract them, she had to pay higher salaries than most day care centers do. That meant setting her prices higher. For many small business owners, that's a scary prospect.
"Customers are going to pay for what they get — if they get an exceptional service, they don't mind paying. You have to set your prices so you can pay your people what they deserve, give them benefits, sick leave, to encourage them to come to your business and stay there."
Some cautioned St. Hilaire-Finn that she was pricing her services too high for the neighborhood where her child care center is located.
"I priced for the people I was trying to attract," she said. "If my neighbor was charging $5, I wasn't going to charge $4.50. Instead, I charged based on what I was going to provide. If you want employees to come today and stay tomorrow, you have to pay them a living wage."
St. Hilaire-Finn's attitude toward her staff helped differentiate her business from other child care options and contributed to her faster growth.
She also followed the advice I give all employers: "Hire for attitude; train for skills."
"When I do interviews, I hire people who are going to best fit our culture," said St. Hilaire-Finn. "I look for people who are as excited about early childhood education as I am."
Of course, hiring and managing people can be overwhelming, especially for first-time employers. "Ask for help," St. Hilaire-Finn advised. "Take advantage of services offered by SBDCs (Small Business Development Centers). They've been instrumental to me."
It's time to hire in your small business if you:
• Need employees on Day One
• Turn away work because you're overbooked
• Can't find time to send invoices
• Are buried by paperwork
• Lack time to pursue new product ideas and/or new clients
• Need someone with specialized skills
• Want to grow a business you can sell
If you're thinking about hiring, consider these factors:
• Figure out your needs. What, exactly, do you need an employee to do? Clearly define the work, and you'll be more likely to find a candidate who fits your needs. (Use the free downloadable worksheet to outline your business tasks.)
• How much you can afford? You need to pay your employee, but you need to make enough to pay yourself, too. When budgeting, include how much money the new employee will help you generate.
• Start slowly. Small businesses hire a quarter of their employees as part-timers. You may even want to get your feet wet with independent contractors, but only if you can legally categorize workers as such. As your attorney for advice.
• Make the mental leap. Before you place a help-wanted ad, begin to see yourself in a new way. Start to think of yourself as a "lead-er" not just a "do-er."
Think about why you went into business. It probably wasn't to be buried by administrative tasks or to make another sales call. It certainly wasn't to sit alone in your office all day, wondering if you'll make enough money to stay in business. By building a team, you'll spend more time on what you're good at, develop new skills, and make more money. In other words, you'll grow.
Do-It-now action items
1. Use the worksheet "Business tasks" to determine which jobs you need help with.
2. Make a personal commitment to build your team this year.
3. Identify the skills you need, but don't personally have, to enable you to grow your business.
4. Make a list of people who can help you grow, such as advisers or strategic partners.
5. Figure out how much you can afford for paid help — even contractors or part-timers.
Small Business Week with Rhonda Abrams
• Monday: Finding a niche. How to make your business distinct from your competitors.
• Tuesday: Business planning. How to be strategic and create a roadmap for success.
• Wednesday: Marketing. How to get more customers through your door.
• Today: Building your team. You can't grow alone.
• Friday: Going mobile and to the cloud. How to run your business from anywhere.
Every day this week, you'll get:
• A five-step "do-it-now action checklist" so you can start growing immediately.
• An article focusing on the topic area with practical, real-world advice.
• A free downloadable worksheet.
Join the conversation: I'm posting on social media. Use the hashtag #yeartogrow and follow along on Twitter (@USATODAYMoney and @RhondaAbrams) and Facebook (www.facebook.com/USATODAY and www.Facebook.com/RhondaAbramsSmallBusiness).
Engage with me: Today I'm hosting a Facebook chat at 2 p.m. ET to answer your specific concerns and to discuss small business growth and issues in more detail.
Rhonda Abrams is a globally recognized small business expert and president of PlanningShop, a publishing company specializing in business planning. Register for Abrams' free business tips newsletter at www.PlanningShop.com and follow her on Twitter @RhondaAbrams and www.Facebook.com/RhondaAbrams.