Don't make hasty decisions in hiring

BUSINESS BITS
Romelda Ascutia

When making your first hire, decide exactly what kind of help you want and how long you'll need it.

You take pride in having started your business from scratch and then seeing it take off without help from anyone. But as the orders grow, you find yourself devoting longer and longer hours to the tasks at hand and often setting up camp in the office to cope with demand. It's time to make your first hire.

Of course, getting help doesn't come without a price. You'll have to spend money on salary, taxes, social security and other benefits, and once the employee has settled in, you'll have to start supervising him and checking on his performance. On the brighter side, hiring someone frees you up to do more important things--and perhaps to get a life.

"The one thing I hated when business finally turned around was the amount of paperwork I had to do and the list of payables that I had to follow up," says Peter Renante, a businessman who hired the first of his two all-around assistants in 2003, a year after he set up his store in Munoz, Quezon City. "It was a relief to let go of those tasks."

So how do you tell if it's time to get help? These guidelines may help: Are you working 10 to 12 hours a day and even on weekends? You may need to pass on some of the workload before you collapse.

Are you forced to turn down work? Compute how much extra income you can make if you accept more work and see if it can cover the cost of a full-time worker. Are there tasks that waste chunks of your time, such as accounting, ordering or answering customer questions? It might be better to train someone else to take over.

Are you backsliding on your delivery commitments? Maybe you're overwhelmed and need an assistant. Are family and friends complaining about your workaholic ways? If your kids no longer recognize you, or your wife is shocked to find you home early, an extra pair of hands may do you good.

Still, don't post that want ad yet even if you've nodded to all five questions. Lyna Esmeralda, a country manager of retail strategist A.S. Louken International Inc., recommends some "forward planning." Make a forecast of your business growth in the next one to three years to get an idea of your manpower requirements.

Once you've decided you need help, define the responsibilities of your new hire. Writing a job description will help you select the right candidate and know exactly what he'll be doing.

Next, identify the traits you need in an assistant. If you want an accountant, look for someone analytical; if you want a human resources manager, pick someone who's people-oriented. "You really need to know your requirements to find the person you need," says Esmeralda. "Of course, in the end you don't really know if he'll stay, but at least you've justified your need.

A common mistake most entrepreneurs make is hiring in a rush. "Forecast demand to see if it will sustain your business" and allow you to pay for extra hands, suggests Lyrna L. Esmeralda of A.S. Louken International Inc. Get temporary help if you'll be needing assistance only for a while or if you think you can afford to pay wages only for so long. But hire a permanent employee if you can't do all the work and your business is making enough money to get him aboard.

And if you can, try to go through the first year without hiring to familiarize yourself with your business' up and down cycle. You may also use that period to boost your savings to carry you through lean times.