Last Updated on Feb 28, 2020 by James W

Starting any kind of business is a major commitment. You can do a lot by yourself, but if you are successful, you will reach a point where you are wasting time and losing money because you don’t have anyone to handle trivial tasks. Employees, even if they are only contractors, can allow you to develop a larger and more stable business. Employees are also a major expense however, and major expenses can be very threatening to new businesses. Employees can be a huge drain on your budget, and a source of significant legal trouble if you make mistakes.

If you want to make the right decisions about hiring employees for you internet business, you need to make sure you have the right process. Assess your budget before making any hiring decisions, judge the needs of your business, experiment with labor before you make permanent decisions, and always be aware of the law.

Assessing Your Budget

You need to have a very clear understanding of your budget before you make any decisions at all. You must be able to accurately predict what you will be making and what you will be spending. In most cases, this means creating an accounting process. It can be time-consuming to start an accounting process that measures all income and expenditures, but once you have that system in place, you will be very impressed with how it helps you measure your needs. In most cases, this can be done with an excel sheet, but larger businesses may want to use dedicated accounting software. If your business becomes very successful, you may even want to hire an accountant.

Let’s assume you will be building your budget by yourself. You want to begin by measuring your income right now, even if you don’t need any employees yet. Be as specific as possible. Don’t just use your gross (the total amount of money you make without any costs included) income as the main number. Split your income up by where it is coming from in your business. If you offer multiple products or services, break them up into categories so you can see what parts of your business are the most profitable. This can also help you decide what to focus on when you are making future marketing decisions.

When you are judging your future income, you need to be as conservative as possible. Don’t assume anything. Start with the money that you are making right now, and assume that you won’t make much more for the next few months. Even if your business is growing very quickly, you can’t assume that growth will be constant. Instead, stay as close to the line of guaranteed income (though really, there is no such thing) as you can so you’ll be safe if you don’t expand as quickly as you hope.

After you have a good budget, and you are very good at predicting the money you will make from month to month, you should start deciding what you need from an employee based on the needs of your business.

Judging Your Needs

The first question you need to ask yourself is: What is wasting my time? If you are successful enough that you need employees, you have likely noticed that you are starting you don’t have as much time as you did when you are starting out. Running any type of business will require performing a load of trivial tasks that are important and time-consuming, but not particularly challenging. For an internet business, these tasks might include general website maintenance, stock inventory, or content production. Business owners will typically need to focus on other tasks like attracting new clients, managing growth, and researching new opportunities.

It should be pretty obvious when you need to start hiring employees. It’s simply the point when you’re losing money because you don’t have enough time in the day. Start by focusing on the tasks that you feel you are wasting the most time on when you need to be doing other things. After you have an idea of what you need, you can start doing some research on how much you can expect to pay for someone to do that work for you.

For certain tasks, you can search online to find out how much you will need to pay. Try starting with websites that do salary studies. If you prefer to work with temps and contractors, you can find people on Odesk, Freelancer, and other websites that match contractors to businesses. In most cases, you will be able to find people who offer specific rates for specific jobs. There will be huge differences in the prices of labor, and you will need to make a lot more decisions based on what you can pay, and what quality you need.

Experimenting with Different Types of Labor

You should experiment as much as possible when you are hiring employees, because you will have a lot of options. Online and offline, you can find thousands of different people who are willing to do the work that you need. You will be able to find incredibly cheap prices, but the tradeoff in quality can cost you more than you think. Focus on cutting costs when the work is menial and doesn’t have any impact on your reputation. When it comes to your public identity, you may want to pay up for the extra quality.

Since contractor employees will often be cheaper and require fewer tax obligations, you may want to see what you can get out of them before you try out permanent staff employees. There are situations where permanent employees will be helpful, however. You may deal with sensitive information in your business, and it can be helpful to have someone nearby who you can trust with that information. Also, if someone in a foreign country steals information or money from you, you may not be able to legally do anything about it.

Be Aware of the Law

There are a lot of laws that deal with employees, and they will be different in every country. A legal dispute over an employee can shut down a fledgling business. Whenever the law is involved, it is better to ask permission than to ask forgiveness. Educate yourself on the laws in your country, and always set aside a small consulting budget to speak to a lawyer if you start dealing with permanent employees.

About Simeon Howard

Simeon G Howard, born in Hampstead London, started his first business at age 21. By age 25, this serial entrepreneur had founded Your City Office Ltd, a Virtual Office and Office Space brokerage firm. Drawing from his past experiences, he and his partners have quickly built and developed one of the UKs leading organizations in this industry.

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Founder and chief editor of Blogger, Affiliate Marketer, Tech and SEO geek. Started this blog in 2011 to help others learn how to work from home, make money online or anything related to business and finances. You can contact me at