I’ll be the first to admit, I am super cost conscious and risk adverse when it comes to staffing – aka, cheap and a wuss. Maybe a bit of a commitment-phobe too. I like to compare hiring business owners, to buying a turnkey company. Instead of hiring the staff, building the processes, etc, you get to skip all that mess, and get to the good stuff.
In my experience, for a number of reasons, I always prefer hiring business owners over employees.
Before I get to the good however, it’s important to understand and expect the “bad.”
Hiring a business owner, freelancer, or consultant tends to cost you a bit more than an employee. Some might expect the opposite, but if you are hiring talent, you are going to pay decent money – especially if they are successful talent.
Being a business owner is a tough task. Clients will try and push you around, employees will attempt to take advantage, and so you learn to have pretty thick skin. As a result, business owners are more likely to assert themselves more aggressively when it comes to asking for rate increases or in contract terms. Unlike most employees, business owners generally aren’t going to put up with your shit – especially the good ones. They will just walk, and if they really want to stick it to you, go work for your competitors.
Don’t expect to get away with delayed payments. Personally, and I know I can speak for many of my colleagues, we do not put up with late payments. If you are unreasonably late, we stop work. It is a matter of respect. If you don’t respect me enough to pay me on time, or at the VERY LEAST, give me a heads up, I am moving on. In my experience, when a client pays me late, it is not a one-time thing. It will happen again and again.
By far the most annoying (but understandable) part of hiring a business owner is that their business is their priority – not yours. You will always, at best, be priority number two, and for some folks, that just won’t do. Don’t confuse it – you are just another project. If you expect priority all the time, you better pay up, or else you are going to be sorely, often disappointed.
Business owners are more likely to understand your business and the information you give them – which they can use to start competing against you in your niche. Even an iron clad non-compete may not protect you. You are giving these people tremendous access and insight into your business. The risk is undeniable.
If you can stomach this, in return, you will get…
Maybe I am a poor manager, but if you can’t motivate yourself, we are not going to work out. With every new addition to my employ, is another personality, and another set of issues. I don’t have time or energy to manage all of this. Business owners, generally speaking, have figured out how to motivate themselves and don’t need to be pushed. This is a must have for me.
More to that effect, they are self-starters. If they can’t act without supervision, they will have gone broke long ago. This is true with almost every business owner I have ever hired – except for one. Unless he changes this, I don’t see him ever being a success.
Less Training Time/Fuller Expertise
Business owners tend to be better-rounded. When you hire someone, you generally don’t hire them for a single task – you require some flexibility. Requirements change, and you need to hire people who can pivot/adjust/adapt. I am not suggesting that a developer become an accountant, but if the developer you hired doesn’t have a strong grasp of JQuery, he is going to learn everything he needs to about it so he can implement. You aren’t going to have to invest in training, you aren’t going to have to wait weeks for courses, etc. Business owners will take this into their own hands, and execute.
One of my favorite bits about hiring a business owner is they are a business owner. This is someone that has likely been there done that. They are problem solvers, and excellent people to bounce ideas off. They get the big picture, and will catch things an employee, with a narrower, less experienced view would might miss. They have perspective, and I can’t teach that.
By extension, their employees are yours too. I can hire a single business owner, and with him/her comes a team of trained team members. Well that was easy!
The Obvious Financial Reasons
Sure you may pay a business owner more per hour, but have you considered what other costs come with hiring employees? Benefits, equipment, training, etc. And what if you have to fire them? Severance pay (and sometimes litigation), not to mention the time required to re-hire.
Can you afford to pay an employee who isn’t working at full capacity? If I am paying someone’s salary, they are getting paid regardless of whether there is work or not. I would much prefer to pay for only hours worked –right?
As a business owner, especially a new one, there can be so much volatility, and committing to employees is often a hell of a leap. Not having any REAL employees makes you no less of a business, and if in your industry (like mine) you can get away with it, I strongly suggest you do.
Do you think hiring employees is a better call? I’d love to hear your insight in the comments section below.