When in business do you take on your FIRST EMPLOYEE? | Processes | MIPA | Accounts
I got a question asked by a client friend of mine who recently went self-employed:
“When should you take on your first employee?”
First off, I think everybody needs to employ or have at least one person that works with them or for them. If you’re a business owner then you need to have somebody in your team who is going to support you. Why you may ask. If you’re a one-man-band, you are most likely doing everything in your business and what that ultimately means, you’re just leaving one job for another job. And do you really want another job? Did you go self-employed to just end up with another job? I know I certainly didn’t. So how do you go about recruiting, employing and working with one person in your business?
Well, the first thing you need to do in my opinion, is you need to have a sales and administration process.
Active Mortgage Process
Within my mortgage brokerage, we have broken down what my PA and I do into 26 steps split across three key sections.
- Top Section – marketing and your strategy, and the top of the funnel.
- Middle section – sales and your delivery, making sure the money comes in.
- Bottom section – is all about your administration and the lower value tasks.
When you start out as a sole trader, business owner or entrepreneur, you are all 3, you’re marketing, lead generation, working on strategy/direction, you’re doing all sales, you answer the phones, you’re doing everything and wearing 53,000 hats in your business, stressed out and probably working from 8 o’clock in the morning till 9 o’clock at night. Is that you?
If it is then here is your first step to get out of doing everything, get it all out in a step by step process. You need to say “Right, what are the things I do on a daily and weekly basis, that are related to marketing, related to building the business, related to lead generation and to networking?”
You then need to think about what is my sales process? What happens when a client makes an enquiry in your business? How do you pick up the phone? Where are the leads coming from? Are the leads coming in via email? Are they Facebook messaging you? What happens after that? Do you book them into an appointment? Do you have a manual diary? Do you have an online diary? What next, do you go and see them? How long is the sale? What is covered? What do you do in the sale that gets you the sale?
Finally, you need to think about your after sales, what is the process? When do you follow up? Are you even doing follow up calls and asking for referrals? What paperwork do you have to send out?
What is your end to end sales process, just list it out step by step. Our process is 26 steps key steps which all have substeps from the first enquiry right the way through to the point where the client completes on their mortgage and collects their keys to move in and 3 months after that of follow up.
Let’s use another example. Lee, who messaged me the question, is a photographer. I would imagine that he’s getting messages on Facebook, he’s probably getting phone calls, he’s probably getting emails. Now that’s something that he doesn’t necessarily have to be answering. I’d also imagine that when he is “working” or doing a photoshoot he cannot be answering his phone. So, there are a few options, he could use something like “Calendly” which is an online calendar and people can book directly into slots he has made available in his diary. If he set up Office 365, he could let a virtual PA have access to his diary and book appointments that suit his lifestyle and fit around him, his family and his business, which I I’m massively passionate about. With that free time and someone booking his appointments he has a choice of how he spends some of that on marketing and strategy, some on sales and some with his family. The key is knowing which tasks are lower value and which ones you need to give up first. There’s no point in having one, a job, or two, working nine to nine and not seeing your kids grow up. Let’s agree you need to build a business around your lifestyle, you need to make enough money to pay your bills, have fun and you need to make sure that you’re spending time with those that mean the most to you.
MIPA – Virtual PA’s
Once you have a process and have broken down every single step, you can then put your name against them, then you can go through and put PA or admin against the others. Once you know what elements of your job you can offload, and please, do not offload the sales tasks first, that’s what makes you the money, you need to control that. You need to offload the low-value, the administration, answering the phone, the bookkeeping, the checking emails, the booking things into your appointment, the potential follow-ups with clients. I do one follow-up with my client, but then Lauren (My PA) will take over and handle that whole process from the point where the mortgage application is submitted. I speak to clients right at the very end, because I can’t be dealing with new clients and placing their mortgages and helping them get their home, whilst also trying to speak to mortgage lenders, attach documentation to their system, focus on getting the solicitors on track, because we all know that buying property solicitors drag their heels.
Within your process, if you can itemise exactly what you want your PA or your administrator to do, then that’s going to enable you to feel a little bit less stressed. Once you have your process and who’s doing what, you can then think about taking on your first employee. Now it doesn’t have to be an employee. A good friend of mine, Emma Mills, runs a company called MiPA, her team are virtual PA’s based in Manchester, and they can deal with answering your telephones (A link to her website is at the end of the article!) along with a shed load of other tasks. You could contact Emma Mills and say “Emma, I want you to answer every single one of my phone calls. At the end of every day, I want you to tell them that they’re going to get a call back within 24 hours. At the end of every day, I want you to send me an email with every single client who has called in, and what the reason for their call is.” Emma is also a productivity wizard so when she knows what you do on a day to day basis she can advise you on what her team can do for you and have where they have the most impact on you, your life, your income and your business.
XERO and a Book Keeper
I have started using Xero, it’s an online accountancy software that is super easy to use. For almost 11 years, I used Excel to do my accounting. I used to go onto Barclays, download my bank statement, income, credits and debits, onto an Excel spreadsheet, and I used to tick off every single invoice. It would take me one or two hours a week. I love tech and I took the plunge in April 2018 and got Xero. You pay for the number of transactions that go through your business and it starts from £13 per month. I can run a monthly profit and loss instantly. I don’t have to try and map it out on another spreadsheet. I can look up the last three months as an average, to see where I’m spending money. You can itemise your accounts and deep dive on the 10 transactions that all came under marketing and administration. It’s awesome for getting detail.
Once you have Xero get yourself a bookkeeper. It has saved me an hour per week of stress and frustration. I put all my receipts into Dropbox and she does the rest. I’ve got a Xero app on my phone, so when I’ve filled up my car with petrol, I put a picture onto the Xero app of the receipt, and then the bookkeeper goes in once a week and reconciles everything, and emails me with any missing receipts. It saves me an hour a week, which, when you add that up, that’s 52 hours a year and a few more faffing about.
The whole idea of taking on your first person is not to be lazy. It’s to have more free time to spend in a variety of ways. Do more networking, share more posts on social media, create more video, ring more people and invest more time in your business and bringing clients into your business. If you’re currently at two sales a week, and you take on a PA, you need to work out do you need to increase to three, four, five sales per week?
Let’s take work case scenario, as a one-person-band i.e. a sole trader you should be doing at least £50,000 a year. Employ a full-time PA who costs you let’s say £20,000 because you want a decent one. As a 2-person team with a superb process nailed down, you should easily do £75,000 to £100,000 per head i.e. £150,000 to £200,000.
The key is getting your process on paper, knowing which tasks to leverage and where to put your energy to generate more customers and grow your business.
I hope you enjoyed this blog, it’s time for you to become an -Active Entrepreneur-, so if you need any helping with marketing, lead generation building your business or recruiting your first employee then get in touch.
I have helped many business owners just like you go from stressed out sole trader wearing the 54,000 hats to a super-efficient team of 4, making more money whilst spending more time with their family.
Get it done!
Emma Mills: MIPA
Join me on Instagram for inspiration, motivation, and stories about building a business around your lifestyle – Instagram
Follow me on Twitter – Twitter