One of the biggest fears I hear business owners talk about when it comes to building their team is “how can I afford to hire someone?” And it is a valid concern. Sometimes it’s hard to think about how you could pay someone else when some month’s you may be struggling to even pay yourself.
In order to grow our businesses we need to start thinking about things a bit differently. One example of this is to not think of new hires as an expense but as a way to earn more. Even if the people you hire aren’t directly bringing more money into your business they are in turn creating the capacity for you to do more revenue driving tasks like marketing that will hopefully bring in more new business. And to me that makes hiring completely worth it.
Today we are going to dig deeper into two big shifts you should consider making in order to feel confident and comfortable about growing your team.
Separating your business and personal finances
This may seem like a super obvious thing and it may be something that was done back when you started your business, but what we need to think about is more than just physically separating your bank accounts. However, if you are still lumping everything together this will be the first thing you will want to do – create a separate bank account for your business and have another one for personal.
Beyond the act of physically separating your accounts, the bigger shift that needs to happen is understanding that any money coming into your business is not actually YOUR money, it’s your businesses money first and foremost. It’s very easy, especially as a solopreneur to feel like every time we get paid for a job or project that all of that money is ours. We tend to just keep all the money we collect from our products and services and use it for everything from the business expenses to groceries, but we have to start thinking of it as our businesses money.
Making this simple shift can play a HUGE role is overcoming any initial fears about hiring and being able to afford to bring on help in your business. You won’t be able to truly wrap your head around hiring and making certain investments into your business until you have a clear understanding of what is actually coming in and how much you actually have to spend. This will play such an important role is not only helping you determine a budget for hiring but hopefully showing you that you can actually afford to hire help.
And you tend to make better decisions when you are working with the businesses money VS your own money – because let’s be honest no one really wants to spend their own money. And this plays right into the second shift.
2. Determine Your Own Salary
It might seem strange when talking about hiring and how you can afford it to talk about taking a salary for yourself, but this is another important shift that will help to overcome those fears of bringing on help.
If you aren’t doing so already, you should start taking a consistent salary for yourself. This took me a long time to start doing. It doesn’t have to be a large amount but the key is that you are paying yourself consistently. Whether it be $500 a month or $10,000 a month – the main part is that it’s happening on a regular basis. As the CEO you are an employee of your company and you need to start thinking this way and paying yourself.
By doing this it will really help to give you a clear picture as to where the money is going and more importantly in this case just how much money is leftover for the company to use. You may just surprise yourself.
In an upcoming post I am going to be diving into more specifics and numbers when it comes to building your hiring budget but I wanted to leave you with this bonus mindset shift…….
You don’t need to have your first or next team members full salary saved or have it accessible upfront to be able to hire them. Whoa…..did your mind just explode? Most times we think about hiring in terms of annual salaries ( especially when we are talking about bringing on employees) or in terms of what it would cost long-term. Realistically you may only need $1000/month for the next 3 months saved or available to be able to hire them. The hope would be that after that 3 month period or whatever window of time you determine – that your company will be bringing in more revenue due to the time you’ve freed up and this will allow you to continue paying them.
If we think about hiring as a small incremental investment to get us to that next level we desire VS a huge upfront cost/expense we will start to realize just how realistic it may be to bring on the help you need for your business.
If you want a few more tips on what you need to consider before hiring make sure to grab my FREE Pre-Hiring Fundamentals Checklist.