Author Topic: Wrestling with decision to hire...  (Read 1244 times)

Swamp Chomp

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Wrestling with decision to hire...
« on: March 26, 2019, 08:18:52 PM »
My wife and I purchased a small 35-year-old business that does mid-end kitchen and bathroom design and remodeling out of a 3000 SF showroom.  In our area, we are among the nicer places to bring your project.  The previous owner we purchased from and who helped me transition into ownership still works with me and we are like family; we have been blessed.  She is in her 70's, full of spirit and loves to stay busy, working about 24 hr/week.  But she's in her 70's and isn't going to work for me forever...  She "produces" pretty well and I'm paying her around $21/hr, which seems quite reasonable.  We have a nice plate of projects on retainer for the time being worth about $200,000, which is 35% of the revenue we did last year. About $50-$60K cash in the bank.

What I'm looking for input on is hiring; I'm wrestling with whether I should actively look for someone to hire who could take on and manage their own projects or just remain small, book my work out in advance as best I can, keep overhead low & profits higher, and have some degree of flexibility while I have Diane there who can help cover showroom hours.  I bought the company two years ago in 2017 and up until recently, have been planning to grow to where we had 2-4 designers on staff (growing as the jobs came -- this is what the prior owner found to be a sweet spot), so that I can focus more on working ON the business rather than IN the business.  But I'm feeling a period of pause of late for a few reasons:

  • Good employees aren't easy to find.  Especially because we're looking for a specific skillset and personality.  And the wage people need seems to be pretty high in our area for the few candidates I have casually interviewed ($50-$60K).
  • I don't know how much I will enjoy the "drama" aspect of managing people.
  • I'm still learning the seasonal and economic volatility in this industry.
  • I'm nervous about committing the cash and taking on an employee(s) wage(s) while waiting for them to get comfortable and start being profitable.
  • I'm constantly second-guessing if we would have enough work.  One moment, I am under water and turning jobs away, and then a couple months later, it will feel like things are slowing down and I'm feeling real hungry.
  • I've spoken with contractors who have once had large outfits of their own with multiple crews running and they say now that they work for themselves, life is so much easier and they are just as profitable, if not more.

There is probably more but it's late at night and that is what I can think of at the moment :)  The thought of having a few people in-place and being in a position to work on the business more than working in the business, as I am now, is exciting and I have a lot of ideas for ways to improve our marketing, our list of services to clients, profitability, etc.  It also seems like it would give us more stability to weather challenging times but then I second guess that too - employees are expensive.  A big factor is that I have a young family and am trying to manage the work/life balance.  In the last two years, I've fallen out of a beloved crossfit routine and struggle at times with leaving the stress at work.

Would be nice to hear from some experienced business owners, especially someone in the building/remodeling industry.  For anyone who responds, it would be nice to know what your work experience is, so I can understand and appreciate your perspective.

Many thanks,
Ben

Linea_Norway

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Re: Wrestling with decision to hire...
« Reply #1 on: March 27, 2019, 02:49:00 AM »
Would it be an option to find a business partner who buys half the business, who will work as much as you do, but who is not an employee that needs to be managed?

There are some posts in this thread that might give you some insight:
https://forum.mrmoneymustache.com/entrepreneurship/does-anyone-regret-taking-the-risk-to-start-a-business/

nara

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Re: Wrestling with decision to hire...
« Reply #2 on: March 27, 2019, 06:41:25 PM »
Hiring employees are how businesses grow! I would not get a partner though--that ultimately means a financial marriage. 

Swamp Chomp

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Re: Wrestling with decision to hire...
« Reply #3 on: March 30, 2019, 07:37:35 PM »
Thank you both.  Two great ways to look at it.