Crafting a Business with Jenny Hart

Give yourself a hand

By Jenny Hart
Published: August 7th, 2008 | 9:00am

Help? Did I hear someone say “help”? Maybe you’re too scared to ask, and it’s the furrowed brow and crazy eyes that give you away. It can be difficult to ask for help, and when you run your own business (especially one based on your creative endeavors), it’s hard not just asking for help but also trusting your work in the hands of someone else. Where do you find help? We all know the old saying: Good help is hard to find. Hoo boy, I heard that. But it’s not impossible.

When your business is ramping up, you might get the rush of excitement with filling lots of orders and the extra energy that comes with the thrill of seeing your business grow. You don’t mind working long hours! This is what you wanted! You can make a dozen necklaces, pack them up, ship them out, and you’re happy to work a 13-hour day! You’re doing what you love! But then as business (hopefully) continues, and the days go on with increasing demands, the novelty and rush of excitement begins to wear off. And then fun things like taxes, invoices, and other administrative tasks begin taking over. Soon, you’re spending more time doing busy work than your most valuable contribution to the business (whatever that may be: making necklaces, taking wedding photos, cooking prepared meals). Suddenly, you can’t keep up, but you also can’t yet afford to hire someone at a pay rate that a more established business can afford. It’s a pinch. Where do you look for help?

ENTER TAXMAN
For the purpose of this column, I’m going to assume that you’re operating at a size where you’re bringing in your first helpers and not ready to build a managerial staff of eight and establish payroll. What’s the difference? Primarily, taxes. If you hire someone as an employee, you are responsible for reporting his or her income and issuing a W-2. If you’re not doing that, then the person helping you is technically an independent contractor, which basically means he or she is responsible for reporting the income she earns from you and reporting and paying her own taxes.

Employment can quickly become complicated stuff. If you are in fact looking to build a staff, there are agreements you may want to have on hand (Letter of Engagement, Non-Compete, Non-Disclosure). Meeting with an employment lawyer or an HR specialist can help you determine the employment scenario that works best for you.

TIME MANAGEMENT
But you just need help. Now. One of the first things you should do is assess how you spend your time and what consumes most of it. Is it assembly? Keeping track of accounts receivable? Trips to the post office? What do you want to continue doing and what do you loathe? Many business owners struggle with handing off previously held responsibilities. My favorite stage of my company was when it was small enough for me to do everything myself, because there was no worrying about how it was being done (that stage didn’t last for very long). If you want your business to grow, you’ll have to loosen up the reigns a wee bit and be willing to hand over some tasks that are preventing you from doing what you love most.

HOW TO FIND GOOD WORKERS
If you are the creative juice of your company, it’s most valuable to the business that you spend your time doing whatever it is that’s unique to your business and that no one else can do. You shouldn’t be chasing down accounts receivable or standing in line at the post office if demands on your time and product increase. Of course, collecting payment for your work is equally vital to your business, but you can find someone else to do that work for you. But who? Where? How?

During my second year of Sublime Stitching, I had managed a small stream of extremely helpful assistants who could only stick around for few months at a time. I was ready for some steady, reliable help. Not knowing where to look, apart from blindly accepting applications (which I had never done before), I got an idea: I turned to a good friend who owns and operates a large vintage clothing store. I asked her if she had any current or former employees who might want extra hours or part-time work. This was a great solution, because my friend knew my business and already had experience working with her employees, and I trusted her recommendation. She immediately suggested an employee she’d reluctantly let go (needing to cut back on staff). He needed extra work, and she considered him extremely reliable and trustworthy. My friend’s former employee turned out to be a law student and also my first long-term assistant to fill orders and answer e-mails. I used to tease him that I felt guilty about having such an overqualified helper, but he explained that he loved the quiet, simplicity of the menial work I needed done (assembling kits, folding patterns, answering customer e-mails) and that he viewed the work as an escape from the stress of grad school. Hello, dream assistant!

Get creative about where you look for help as well as considering these options:

• Friends: Camps are divided on hiring friends to work for you. This is largely a personal decision. It may sound like the perfect solution at first: They offer to do it for free or for less than what you’d pay someone else, they want to support you, and, hey, you’ll be working with friends. And since you’re a business owner now, with an endless stream of self-generated income, you can support your friends by giving them jobs, right? (this is often their reasoning, not yours)

But what if your friends tell you at the last minute that they can’t help you today? You’re cool with that, aren’t you? What if your friends aren’t doing things quite the way you’d like them done? What if they don’t like you being all bossy and stuff? Hello, awkward situation. My advice is to think carefully about casually bringing a friend into your business unless you have both clearly discussed the expectations on both sides.

• Interns: Live near a university? Check out their internship programs. Internships can be good for you and the intern because the tradeoff for no pay is on-the-job experience. The downside is that if you aren’t paying someone to work for you, it can be difficult to make demands on how they carry out their work, and they may be less reliable than paid assistants.

• Paid professionals: When it comes to doing your taxes, filing a trademark or setting up servers to back up your files, leave it to the professionals. Some administrative tasks can and should be handed over to professionals. It may be expensive to have an accountant do your taxes, but it may be costing your business more in time lost if you’re struggling to do them yourself. [Read Jenny Hart’s “Knowing How And When To Hire a Good Adviser” story for advice.]

• Paid assistants: Paying hired assistants involves conducting a search for help. It’s time-consuming, and once you’ve hired them, you must invest time into training them. Unfortunately, sometimes they don’t do things quite the way you would, and geez, it would be faster if you just did it yourself. Patience, prudence. Give the helper a chance to get up to speed and learn the ropes. Make sure your needs and expectations are communicated clearly. Let assistants make mistakes, but be sure to point them out, and give them a chance to correct problems.

It’s also good to give yourself and your employees a trial period (or probationary period) to see how things go. Set a date three weeks from your helpers’ start date to review and discuss. This will be your chance to review their work and for them to see if they like working for you. If wrinkles haven’t been smoothed out, even with your constructive feedback, this is your chance to let them go with reasonable warning (pointing out that they need to correct mistakes is considered warning). If things have been smooth sailing, then this is the time to hire them and perhaps even raise their pay.

HOW TO PAY STAFFERS
Don’t make the mistake of under-paying yourself or paying an assistant in lieu of paying yourself. One of the basic tenets of running a business is that you must pay yourself first. This isn’t about greed or maintaining hierarchy: It’s about the simple fact that if your business can’t afford to pay you, the owner, then you can’t afford to hire help, and you can’t sustain your operations. Establish a reasonable pay for yourself (based on what your business can afford, it doesn’t mean funneling all the profit straight to you, just establish some rate of consistent pay for yourself that can grow reasonably as the company grows) and then determine what you can and can’t afford to pay for outside help.

When your helper agrees to start work, make sure you are clearly agreed on:

• Rate of pay: Be sure you agree on what you will pay your helper and when. Put it in writing too, and if you are not hiring them as an employee, this is when including their status as an independent contractor, responsible for reporting their own taxes is a good idea. Also, make sure your helper understands that you are a startup company and that what you pay is what you can afford — not what the market offers elsewhere. Be up front and realistic about the pay scenario. You may be doing the same work within your own business for $15,000 per year that would be paid $40,000 per year by a large corporation. The difference? You’re a startup and not an established corporation. Not everyone can afford to work for a startup business, but they might want to for the perceived, funky-fun factor. The tradeoff is being involved in building a growing business (partial ownership in the company may be offered in lieu of pay), contributing to its growth early on, and reaping later rewards of the hard work forged in the initial stages.

• Schedule: I give my own employees an hour window to show up for work, based on what works best with their schedule. The result is I never have to complain about someone showing up 15 minutes late, and they arrive relaxed and ready to work. Also, establish a cap on hours so that there’s no misunderstanding that you can afford to pay them however many hours they end up working. Establish a window, such as a minimum of 10 hours per week and a maximum of 15.

ANOTHER WORD TO THE WISE
Suss out your prospective helpers’ attitudes about working for you. By this, I mean, do they want to work for you because they think it will be “fun making necklaces all day long”? Make sure you are hiring a helper who understands that running a business means business, and that you’ve been doing the hard work yourself all along and need help doing the not-so-fun things like sealing 100 envelopes or folding 500 promo fliers. Chances are, if they cop an attitude about doing that type of work, they won’t be much help in the end. And you’ll feel insulted because, hey, isn’t that what you’ve been doing all along?

There are numerous legalities involved with hiring and (gulp!) firing help — far too many for me to detail here (accessibility, paid time off, review processes, unemployment taxes), and while most Internet-based businesses are just looking to bring in some quick and easy help, it would be wise of you to become familiar with what is required of you as an employer from the beginning. It will prepare you for the inevitable expansion of your enterprise.

Oh, yes, you will have bad experiences. Like an assistant who purchases $1,000 worth of inventory without permission to the helper who drops off 30 packages with no postage and surfs the Internet for and hour and a half (during a four-hour shift) as soon as you step out. Maybe they don’t handle problematic customer e-mails well. Or send you an e-mail with the F-bomb just for having said: “I’m sorry, we can’t afford to give you extra hours right now.” True tales from the front lines, my DIY dears. You may have to stomach a certain amount of unfair vilification from assistants who don’t work out and don’t understand why you have to let them go. So, be ready to say, “Farewell. So sorry. Not on my watch. Good-bye, and good luck” or they can make short, destructive work of your business. It’s not easy, and it sure isn’t fun to confront them. But there are ways to appropriately deal with these situations, and that will be your responsibility: to deal with bad situations appropriately and professionally when the employee doesn’t. But take heart, the truly bad experiences should be few and far between. Mine were — I’ve had far more wonderful employees than those who needed to be shown the door.

Hiring is a very different affair for my company now than it was when I first started. But, all along, consulting with an HR specialist proved to be an invaluable guide in keeping employees happy, legal issues at bay and taxes paid. My own company went from having one or two part-time assistants who worked under my direction for the first few years to building a managed staff of four in the span of one year. Good help may be hard to find, but it’s out there. And when your staff comes together, freeing you up to concentrate on what you do best, it’s magic.

RESOURCES

The Boss Of You
By Lauren Bacon and Emir Mears
Chapter 11: Hiring Help

The E-Myth

Independent Contractor or Employee?

Non-Compete Agreements for Employees

Guidelines for Hiring and Firing

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TALK TO JENNY
This is the eighth installment of Jenny Hart’s “Crafting a Business” column. Send your questions to askjenny [at] sublimestitching.com. View additional "Crafting a Business" columns here.

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