It is exciting to see growth in your business. Growth can help you measure how your current efforts are working and aid you in determining what needs to change. In addition, it can be extremely motivating to see your business grow as a result of your hard work. Unfortunately, there are also some frustrating elements to growth that plague many business owners. One of the most frustrating elements that come along with business growth is increasing costs. And the one area of increasing costs where business owners feel the most acute level of pain is labor. As your business grows, you will have to spend more money on labor, there is no way around it. But, there are some steps you can take to minimize the labor costs you encounter as your business grows.
Put off hiring new people as long as possible
Hiring a new employee is expensive. You have to spend your valuable time searching for, interviewing, hiring, and training each new person. Before you ever pay one day’s worth of salary you have already put in a significant investment in order to fill a role. Then there are the costs of salary, benefits, and ongoing training and management to consider. One way to temporarily avoid incurring these costs is to delegate new tasks to current employees. This allows you to put off the task and expense of bringing on a new employee. This method can work but only on a temporary basis. If you continually pile more work on the desks of your current employees they could become overloaded and burn out. Then you may find yourself in a real bind as integral employees decide to leave.
Hire part-time labor
Part-time labor can be a less expensive option to hiring someone full-time. This is especially true if you do not have quite enough work to keep someone busy forty hours per week. It is a waste of money to pay someone a full-time salary when they do not have a full-time workload. Part-time labor can help you fill the gap when you need a little extra help. Another cost saving benefit to using part-time or contract labor is that you cut down on some of the expenses related to benefits-such as employer paid health insurance. If you choose to hire part-time labor, keep in mind that you will likely experience a higher turnover rate than with your full-time employees.
Work with an outsourcing company
Another option for minimizing labor costs as your business grows is to work with an outsourcing company. Advances in technology have created an environment where companies complete a large percentage of their daily tasks electronically. Many of these tasks can be outsourced and completed for a fraction of the cost you would spend on hiring and maintaining a new, full-time employee. And, it is not just basic tasks that you can outsource. Top notch outsourcing companies employee highly trained individuals who can handle high level tasks. The best way to find out which of your company’s tasks can be outsourced is to ask. You will probably be surprised at just how many things you can put in the hands of a high quality outsourcing agency. Outsourcing will save you on labor costs because you do not have to go through the hiring and training process over and over as your business grows. In addition, you will not have to provide benefits or physical working space to outsourced employees like you would for a full-time staff member.
Labor costs can quickly get out of control when your business is experiencing growth. But, if you are proactive about minimizing your labor costs you can bring on the help you need without sacrificing your profit margins.