KNOWING THE RIGHT NUMBER of employees to hire is often challenging, especially when you are starting a new business. In some cases, you might hire more people than your business needs, leading to some people having nothing to do or you spending more of your budget than you need to on keeping them around. On the other hand, if you hire fewer employees than you need, your business may fail to perform up to clients’ expectations. The following are some of the things you should consider when determining the number of employees needed by your business.
The size of the firm plays a big role in determining the number of employees that should be hired. Typically, the larger the business, the more the employees will be required. You will need to establish whether the business has adequate capacity to hold the employees physically, unless you are hiring virtual workers that will work remotely from home or from another country. Investment firms, for example, can be operated online and, thus, are capable of hiring large numbers of employees since no physical space limitations can hinder the hiring process.
Technical expertise diversification is another important factor that determines the number of employees that can be hired. Normally, businesses require experts seasoned in different fields, although in the least number possible. Establish the technical posts that require at least an expert such as general manager, marketing, communication experts, and tech support. Then, establish the least number of employees that can run the business successfully.
The rate at which the labor of the company is supposed to be accomplished is another important consideration to make. Big labor force means that a lot of work will be accomplished fast, especially if it cannot be mechanized. Mechanization reduces the number of employees, while at the same time, increasing efficiency and speed of work. However, if the job you need done cannot be automated and has to be done fast, it will be indispensable to hire several employees to complete the work on time.
Check the cost of labor and the budget of the business. It takes money to recruit, train and hire employees. The cost of hiring employees includes both offline and job opening advertising, developing the job description, conducting in-person interviews, conducting telephone interviews, and responding to resumes. Administrative costs, salaries and benefits of employees to be hired also exist. Establish whether you are hiring the employees on permanent or seasonal basis.
Hiring on a permanent basis tends to involve rigmarole procedures and expenses, causing businesses to hire only limited numbers. Temporary employees can be hired in large numbers since there are no contracts biding the employer to give benefits and maintain them on a long-term basis. This is especially true to businesses that have peak seasons that demand for increased labor.
Look at what the legal requirements of the law or business stipulates that the business should have. Franchised businesses are the ones that mainly stipulate the number of employees a business should have. However, there may also be regulations by the law that at least a certain number of people should be hired when you are starting a business.
Lastly, professional assistance cannot be beaten when it comes to determining the right number of employees. Look for a seasoned entrepreneur in your industry that you can depend on for an honest answer and seek their advice. They should be capable of giving you a rough idea of the number of clients needed to get the service started. Another, more covert option, is to study your competition, if possible. Go to their place of business at different times of the day and see how many people you see milling around.