In my last post, I talked about how leveraging a team can be one of the best yet most difficult ways to grow your business. You HAVE to be ready for the changes that will come your way by developing rock-solid processes and understanding how your role will change. You will grow from managing projects to managing people.
Now I want to challenge two popular myths about hiring a team:
You’ll make more money
Leveraging a team is a great way to increase revenue, but it’s easy to fall into the trap of growing top line numbers (revenue) while net profit remains the same. Or worse…goes backward. It’s a classic and tragic mistake.
When you add people, you’re either adding an expense by hiring support staff (think bookkeeper, virtual assistant, social media manager), or you’re adding to your cost of labor by sharing your project fee or paying a commission or affiliate fee for selling products. All of this affects profit.
I learned this the hard way when I started adding people to my team. For 2 years, all the revenue was mine. My expenses were incredibly low — a laptop, notebook and a few expenses for tech tools. For the most part, I kept what I made.
Now, with 10+ people on the team, top line numbers are almost vanity metrics, and don’t correlate to money in the bank. Growing your business and revenue isn‘t the same as growing your retirement fund. There were a few months that I worked harder and made less money until I started to grasp this concept.
There’s always a cost of doing business, and it’s not something to shy away from. You just need to be aware of how your expenses are affecting your bottom line.
2. You’ll have more time
Before you hire anyone, you need to know that having a team does not mean that you work less. In fact, you’ll work MORE than ever when you have 1, 2, or 10 people you are now responsible for and relying on to work with your customers.
This is because you’re not just overseeing the work, but also the people you are relying on to deliver the work. A team expands your reach and allows you to take on more business. You’ll be spreading the responsibility among more people, but you’re still taking on more work. Don’t fall for the myth that hiring a team will mean an abundance of free time.
That said, the goal of every entrepreneur is to balance work demands and having a personal life. You shouldn’t insist on doing all of the work yourself. You just need to be aware of the realities of managing a team.
So is it worth it?
If leveraging a team is fraught with danger, why do I recommend it as the best way to grow your business revenue? Because it IS…
IF you have grown your business the right way and set up systems along the way.
This year, we will double our revenue from last year because we have double the amount of people working. Last year we helped 52 clients, and this year we are on track to help well over 100. That will bring in more revenue and definitely grow the business.
And, it has grown ME as a business owner, which I believe is a key element to growing your overall business.
Entrepreneurs are a strange breed. Not everyone is ideal for the constant growth and risk that comes with growing a business. And I want you to know that it’s okay to stay where you are.
If business is great and you are happy, please do not assume you have to grow your business and revenue. Too many people chase after something they think they are ‘supposed to do’, which can ultimately end up being their downfall.
You are running your own race. A lot of other business owners and coaches prescribe to the idea that you need to hustle and capitalize on your momentum.
That can be true, but not everyone is meant to grow their business this way.
Sometimes the answer is no, and sometimes it’s not yet. Knowing the facts and being incredibly self-aware are key to determining when it’s time to move forward in your business. Keep your eyes on your own paper, and you’ll find success on your own terms.
