Thinking about hiring help? Maybe you’re drowning in tasks. Maybe you’re missing growth opportunities. Or maybe you’re just sick of doing everything yourself.
Totally fair. But before you post that job listing or message your cousin’s friend who “needs something part-time,” slow down.
Can your business actually afford to hire?
Here’s how to use your books to find out. Fast.
Start With This: What’s Your Monthly Net Profit?
Look at your last three months of net profit… after expenses, after taxes, after everything. Is it consistent? Is it growing? Is it enough to comfortably cover your personal income and still leave breathing room?
If you’re barely covering the basics now, adding payroll (or even contractor pay) might break the system.
Consistency is key. If profits swing wildly from month to month, locking in a fixed cost like payroll could increase stress instead of solving it.
Run the Real Numbers Before You Post the Job
Hiring is not just about hourly wage. It’s:
- Wages or contractor payments
- Taxes and insurance
- Software, tools or equipment
- Your time to train and manage
- A buffer for mistakes, sick days, or slow onboarding
Write down a real number. Then ask: Could your business handle this every month, starting now?
You also need to factor in the cost of turnover. If you hire too early and have to backtrack, the time and money lost can set you back further than doing it yourself.
Still unsure? Keep going.
Look at Revenue per Employee (Even If You’re a Team of One)
Take your total revenue and divide it by the number of people actually working in the business. If it’s just you, that’s fine.
Then ask: Is there enough margin for another person to help and still make a profit? Or will you need to grow revenue first before growing the team?
Use this ratio to set benchmarks. If you’re generating $200K a year solo, could your business still thrive if that number dropped temporarily while a new hire ramps up?
Hiring before the numbers can support it is where most hiring mistakes happen.
Ask: What’s the Payoff?
Don’t just think about the cost. Think about the return.
Will hiring let you take on more clients? Will it free you up to sell, market or build? Will it fix a bottleneck that’s holding back revenue?
The best hires either make you money or give you time to go make more. If there’s no clear payoff, it’s probably not time yet.
Make the payoff specific. “Freeing up time” is vague. But gaining 10 hours a week to close two new clients a month? That’s measurable and justifiable.
You Don’t Need a CFO. You Just Need Clarity
Hiring isn’t about vibes. It’s about numbers.
If you’re thinking about hiring but your books are a mess, that’s the first problem. A decision like this needs numbers you can trust. When your books are not current or you’re running on gut feel, it’s time to tighten the data.
Let’s review your numbers together and figure out what’s possible, before you commit to a paycheck you can’t sustain.
