Did you know that the more people you employ the more likely your business is to succeed? TRUTH!!
A report that looks into the survival of businesses over a four year period indicated the greater the size of a business in terms of employees, the higher the rate of survival. Link
How does having staff help my business?
Survival of a business with no employees over 4 years is only 59.6%, which is less than the average of 64.5%. This is significantly less than large businesses which have an 85.6% survival rate.
By having 1 – 4 employees in your business, your survival rate goes from 59.6% to 69.3, and by having 5-19 employees your survival rate all of a sudden skyrockets to 77.6%!
Obviously, the number of employees you have in your business is not the only factor in determining your success rate.
I would also encourage you not to get too hung up on these sorts of stats as every business is different and you don’t have to end up a statistic! Empowering business owners is my thing and if we all just looked at dismal success rates we would all begin to lose momentum and spiral into a dangerous downturn of hopelessness. No one wants this for your business, so keep your head up and focus on YOUR PLAN!
How to know when to hire staff?
Employing staff may not be the first thing you do, as you will need to build up momentum and business so that your cash flow and incoming revenue can justify this additional expense.
Wages are not the only thing to consider when it comes to budgeting for staff. There are also things like office space, equipment, superannuation, employee taxes, and other overheads such as training and entertainment that come with having staff and building a good team culture which an HR consultant will tell you.
Once you reach the stage where you have enough cash flow and forecasted revenue to justify hiring staff (which we can help to determine with you), you will need to do some research into the right types of wages, employee contracts, entitlements etc. These tasks are not normally ones that a bookkeeper can help with but you can head over to the https://employ.business.gov.au/ website which has loads of free and helpful resources to get you started in finding the right Award wage, get contracts, and helpful tips.
What does a bookkeeper do when you hire employees?
Once you have staff on your books there are other duties a bookkeeper must do which include:
– Payroll reports
– PAYG reports
– Superannuation reports
– Following up payments on entitlements
It might sound like a lot to take care of, and a huge overhead and burden to a business to carry, but as we have explored, having staff comes with many benefits to your business to allow it to grow and the plus side is, your bookkeeper is there to handle all of the nitty gritty paperwork, payroll and reports for you!