Launching and growing a successful small business from scratch is a gratifying accomplishment. However, with growth often comes some growing pains if you try to manage everything indefinitely.
At a certain point in your company's trajectory, you will likely need to hire employees for your small business to allow you to continue scaling.
Hiring your first staff members is a significant milestone that enables you to increase productivity, leverage support for day-to-day tasks, and shift your time towards more high-level strategic management and planning for the future.
However, the process of hiring carries inherent risks. Costly mis-hires can become major resource drains, hurt team morale, hamper progress, and even sink companies. Especially in those early and formative days, you want to avoid poor hiring decisions that feel right in the moment but are regrettable.
This comprehensive guide will walk you through all the steps and key considerations when hiring your inaugural team members.
Follow the advice provided here to set your staffing effort up for success, make the right role choices that fit your needs and culture, handle the recruiting and interview process effectively, and ultimately build a stellar team positioned to help take your business to the next level.
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1. When Is the Right Time to Hire Employees for Your Small Business?
An important strategic decision is determining the appropriate juncture to begin hiring your first employees. Moving too quickly to add staff can strain your finances and other limited resources if revenues still need to be increased to support the extra overhead.
Alternatively, waiting too long to expand your team can stunt the business' growth trajectory if you're chronically overwhelmed handling everything solo.
Look for these signals that hiring may be the right move for your current stage of growth:
Your workload has become genuinely unsustainable. You work 70+ hour weeks nonstop to keep up with the myriad tasks and responsibilities required to maintain daily operations. Bringing on extra hands provides much-needed bandwidth to shift focus towards higher leverage activities and not just do all the work yourself.
New business demands require staff growth. Your company recently landed a few major client accounts that significantly increased the volume of work. Or product demand may have increased. When business conditions change substantially, new hires are often required to fuel and support the next growth phase.
Revenue is steady and sufficient to support salaries. Carefully evaluate whether finances are healthy enough to take on the increased overhead expenses associated with employees. Conservatively assess if you can sustainably afford additional payroll long-term, not just for a few months.
Hiring alleviates specific pain points. Pinpoint where you are struggling or need support the most. Which tasks or bottlenecks cause you the biggest headaches? Staffing up purposefully to remedy those issues can provide tremendous relief.
When assessing readiness to hire, be strategic and disciplined. Start slowly and remain lean, hiring to fill only your most pressing and mission-critical needs before adding too many roles simultaneously.
Bringing on too many new staff members too quickly places strain on available resources, budgets, management bandwidth, company culture, and work processes.
Prioritize and focus on the one or two most important hires first that will provide the most significant immediate value and relief.
For example, a fast-growing e-commerce company needed help managing customer service inquiries. Hiring a dedicated customer support rep as their first employee allowed the founder to focus on high-level growth while improving customer satisfaction.
2. Preparing to Hire Your First Employees
After deciding the timing is right to begin hiring, spend ample time upfront laying the operational groundwork before actually posting job listings and recruiting.
Rushed hiring without preparation often leads to poor role choices and bad cultural fits. Investing in readiness will equip you to select candidates that best match your needs and vision.
Research average market pay rates for the specific roles you must fill. Gather salary info from resources like Glassdoor, LinkedIn, Bureau of Labor Statistics, and local job boards to determine pay scales that attract qualified applicants based on location, industry, experience level, and position type.
Being competitive on compensation is critical to drawing top talent, So you should avoid inadvertently pricing yourself out of viable candidates by offering too little.
For example, an IT services firm looking to hire software developers would research developer salaries in their city and adjust them based on the years of experience required. They discovered $90,000 - $110,000 was the going rate.
Thoroughly review employment laws and regulations you must comply with as a new employer. Consult with HR professionals or legal counsel if needed. Understand obligations around hiring regarding pay, overtime, benefits, leave, workplace discrimination rules, safety requirements, termination, required postings and notices, etc. Stay out of legal trouble.
For instance, federal contractors must adhere to VEVRAA and comply with affirmative action mandates. States like California have many additional employer requirements. Know which laws apply to your situation.
Establish payroll and core HR systems ahead of hiring. Choose and implement payroll processing software. Evaluate health insurance plans if they provide benefits. Ensure you have the HR infrastructure, such as offer letter templates, employee handbooks, non-disclosure agreement forms, etc.
Nothing creates a worse first impression than a disorganized onboarding experience for a new hire.
Create company accounts on leading online job boards and aggregators like Indeed, Monster, Glassdoor, etc., to post openings. Also, establish profiles on niche industry job boards, relevant social media channels, and other platforms that align with reaching your candidate demographics.
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Casting a wide net improves your odds of connecting with that perfect hire. Don't just stick to one channel and miss out on great options because of limited exposure.
When you complete the necessary preparations and lay your hiring groundwork, you'll be equipped for success in finding candidates who become stellar additions to your fledgling team.
Rushing into the recruiting process haphazardly without such planning diminishes the chances of making great role choices.
3. Writing Quality Job Descriptions
Well-crafted job descriptions are vital for attracting suitable candidates who fit your requirements. Convey what the role entails and must-have qualifications so applicants can self-assess fit.
Outline day-to-day responsibilities and core duties in detail. Be as specific as possible. This sets accurate expectations so candidates understand what they would be doing and determines whether it appeals to their interests and background.
List the required hard skills, education, and experience that are absolute must-haves for the role and explain why these qualifications are essential. For example, a bookkeeper role would require prior bookkeeping experience and knowledge of accounting software.
Note any preferred or nice-to-have skills that would be bonuses but are not dealbreakers. These can provide helpful signals to distinguish between two otherwise qualified applicants during the hiring decision process.
Essential details about your company culture, values, people, and work environment. Give candidates a feel for the organization's personality and what it would be like to work there. Align with your brand identity - after all, these hires represent you.
Keep the description clear, concise, and skimmable rather than dense paragraphs. Use bullet points and short sentences to break up the text. Make it easy to digest at a glance.
While listing basic qualifications is essential, describe your company personality to convey work environment insights aiding cultural vetting. For example:
"Our tight-knit 25-person team prides itself on transparency, collaboration, and hustle. We move fast, build each other up, and strive for greatness together."
Discuss growth opportunities. Candidates want career development paths. If structured programs are lacking initially, emphasize your rapid pace, unlocking quick-scaled responsibilities for willing learners.
Ask current employees what they enjoy about their roles for testimonials, breathing authentic life into descriptions. Quote actual staff praising autonomy, constantly new challenges conquering, team bonds formed, etc.
Distribute polished job descriptions across all the sourcing channels where you'll promote the openings. The description informs potential applicants and serves as a screening mechanism to attract candidates with relevant abilities.
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4. Sourcing Candidates Strategically
Once your job descriptions are ready, begin sourcing applicant submissions. Widen the funnel by leveraging diverse channels and networks to attract qualified candidates aligned with the roles.
Promote openings prominently on your company careers webpage. Ensure the link is easy to find on your home page navigation. Devote a page to sell your employer's brand and culture.
Post listings on high-traffic generalist job boards like Indeed, Monster, ZipRecruiter, and niche industry-specific sites relevant to your roles. Choose targeted paid packages to get visibility.
Promote on LinkedIn to tap into your extended network. Utilize paid job slots and post company page updates to maximize reach.
Leverage employee referrals by offering bonuses for successful hires. Current staff often know other talented people.
Attend local industry networking events and relevant conferences to connect with potential applicants personally. Work those conversations into pitching your openings.
To spread the word, email professional associations, alumni groups, meetups, and community organizations aligned with your industry.
Casting a wide net through diverse channels and communities improves your chances of surfacing great candidates you may have yet to encounter.
Don't just post and pray - actively market your employer brand across multiple platforms.
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5. Initial Screening of Applicants
Once you start receiving applicant submissions, screen candidates carefully to filter for the most promising potential fits versus wasting interviews.
Conduct 15–30-minute phone or video screening calls to verify skills, experience, and overall communication abilities beyond resumes. Prepare a list of screening questions based on your top criteria.
Assess energy, enthusiasm, and personality even in this early interaction. Do they seem engaged and interested? Look for any red flags like badmouthing former employers.
Gauge qualifications against the job description's requirements. Politely decline unqualified applicants quickly so as not to provide false hope.
Advance promising candidates to the entire interview stage. However, if no one passes initial vetting, keep sourcing and screening until qualified options emerge. Remain patient but persistent.
Track assessment progress for all applicants in an organized spreadsheet or CRM system. Take detailed notes on impressions that you can reference later.
Thorough initial screening based on the role qualifications saves you countless wasted hours interviewing mismatched applicants. However, keep an open mind since promising candidates sometimes look perfect on paper.
Don't let pedigree blind you - some of the best hires bring nontraditional backgrounds.
6. Conducting Interviews
After screening, qualified applicants are advanced to the complete interview stage. Thoughtful interviews provide critical insights to make final hiring decisions.
Develop a structured interview guide of questions that align with the role's required qualifications and responsibilities. Ask each candidate the same questions consistently for easier side-by-side comparison.
Phone screening: 30 minutes gauging baseline skills, achievements, and communication abilities.
In-person interview: Hold at least one hour-long in-person interview to assess the presentation, professionalism, communication skills directly, and overall fit beyond resumes. Please take note of how candidates carry themselves.
If desired, consider including senior staff in additional panel interview rounds. Before deciding, gain other informed perspectives on candidates.
Incorporate relevant skills tests, assignments, or work samples to evaluate capabilities if feasible for the role objectively the role. For example, I am seeking a graphic designer applicant to create a sample design.
Always thoroughly check professional references to confirm that past managers' experiences align with candidates' claims about their background, performance, and responsibilities.
The interview process deeply vets capabilities and evaluates important intangibles like the organizational fit and workplace culture match that determine long-term success.
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7. Making the Final Hiring Decision
After completing all interviews and assessments, compare candidates to decide on hiring. Only move forward once you are confident you've found the right match.
Confirm which candidate best meets the hard skills, experience, and qualifications outlined in the original job description. Make exceptions on must-haves that could set the new hire up for failure in the role.
Determine who best suits your company culture and values based on interactions. Ensure alignment to prevent friction.
Review interview notes, test results, and detailed references, and check feedback carefully. Watch for any red flags or warning signs that pop up.
Discuss impressions of final candidates with any other hiring decision-makers. Synthesize all perspectives before deciding.
Make an official job offer to the chosen candidate: state compensation, benefits, PTO, start date, and other agreed-upon terms and conditions. Send an offer letter they can sign if they accept.
Trust your instincts during the hiring process - cultural fit can be just as crucial as hard skills. Slow down if needed until you are fully confident you've found the ideal hire.
8. Onboarding New Hires for Success
Once your offer is officially accepted, thoughtfully onboard new employees to ensure a smooth transition into roles.
Conduct thorough onboarding starting Day 1 to welcome and equip new hires with everything needed to ramp up quickly. Provide extensive training, documentation, mentoring, and regular check-ins.
Set expectations and initial performance goals. Outline procedures for ongoing career development and performance reviews.
Foster positive team dynamics. Promote collaborative work environments and open communication. Have team members introduce themselves.
Assign peer buddies to join new employees for lunches, coffee meetings, and social events. Buddies introduce company context and relationships through organic interactions.
Check-in regularly during the first three months. Ensure new hires adjust well and address concerns quickly before minor issues balloon.
Investment into robust onboarding pays dividends through employees who become fully productive and engaged with long, successful tenures. Set the tone from the outset.
9. Managing 90 Day Probation Periods
It can be prudent HR policy to start new hires on 90-day probation periods before they become permanent staff members. This provides time to confirm they are indeed a good fit.
During the hiring process, inform candidates of the probation period and set clear expectations that their employment remains conditional for the first 90 days.
Structure 30, 60, and 90-day check-ins to provide formal feedback on performance, attitude, culture match, etc.
If progress needs to be improved, provide training support and clarify issues. But also be willing to cut losses quickly if problems seem unfixable.
Transition high-performing probationary employees to permanent roles after 90 days. Have them sign updated employment confirmation paperwork.
Probation periods build flexibility to reverse poor hiring decisions before making significant long-term commitments. Handle sensitively and communicate often.
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10. Scaling Your Team Over Time
After making your first few hires, continue gradually expanding headcount strategically and financially sustainably.
Before each new hire, reassess your needs, growth trajectory, and finances to confirm the timing makes strategic sense. Don't over-hire too far ahead of revenue.
Standardize your hiring process using what you built for the first roles. Tweak and improve along the way.
Keep instilling your desired culture as the team grows. Have respected veteran employees help onboard and mentor new hires.
Review organizational structure, reporting lines, and succession planning as headcount expands. Maintain clear supervision and development paths.
Celebrate growth milestones! Recognize major hiring benchmarks and thank teams for their efforts as you scale.
With solid foundations and practices, you can consistently scale your team over time in a healthy, sustainable manner.
Key Takeaways - Hire Employees for Small Business
Hiring those first crucial employees lays the talent foundation for scaling your company long-term. Invest time upfront in preparation and the hiring process right the first time.
Vet candidates thoroughly across both hard and soft skills to assemble the ideal team for your culture and needs. Effectively onboard new hires, supported by structured probation periods to confirm fit.
Then, continue growing your staff strategically over time. Your organization will thrive for years if you hire, develop, and retain the right people.
Key Takeaways:
Gauge hiring timing based on needs, growth, and finances. Start small and slow with critical roles.
Prepare payroll, HR, job listings, and employer branding in advance.
Write detailed job descriptions that attract qualified applicants.
Widen the funnel by sourcing candidates across diverse channels.
Rigorously screen and interview candidates for both skills and culture fit.
Onboard new hires thoroughly and manage probation periods.
Scale your team strategically over time.
Additional Resources
Thank you for reading this article on Hiring Employees. We recommend these additional articles on starting a business.
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