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To Hire or Fire?
From Stitches' State of the Industry 2010
May 2010
By Shane Dale

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If you’re a small-business owner and you need to hire someone who’ll help you on the sales front and will also assist you with administrative duties, the most important thing to find out about your prospective employees is the way they handle stress, according to Steve Freeman, owner of (asi/700501).

"You’re putting someone in a position that requires them to make good decisions at stressful times," Freeman says. "What do they do if they have one person standing in front of their desk, the phone rings and the UPS person walks in?"

Doing some role-playing exercises during interviews is a healthy way to gauge the stress factor, Freeman says. "For example, you can put someone on a telephone, call them and turn up the heat and see how they deal with it," he says.

Equally as important in defining a potential employee’s role is figuring out how you, as the business owner, are going to support that person in that role, according to Danon Middleton, partner at Tango Partners. "What are the things I’m going to do to help that person succeed on the job?" she says.

And while it may sound obvious, it’s key to determine the employee’s pay structure prior to the hire. "You really need to think that through in addition to whatever commission you’re going to pay them," Middleton says. "There are a lot of decorators moving to flat salaries. Outside of commission, what other things are you going to give them? Do they have to have a laptop, or other equipment, that you pay for, or a personal work area?"

Middleton adds that sales reps and operational employees don’t always mesh. "If you’re a salesperson, you think outside the box. If you’re operational, you’re process-driven," she says. "So, you’re trying to combine two personalities that don’t always fit. Sometimes the person you’re trying to create is a mythical person. It doesn’t exist – or it doesn’t exist and do well. What you really need is someone who’s really customer service-focused. That’s a better fit than the other way."

On the opposite end of the spectrum – being forced to lay off an employee for financial reasons – Middleton says that decision should be primarily performance-driven. "If you look at the person who’s not performing 100%, you’re not getting your full investment out of that person," she says.

But before any firing, it’s crucial to make sure that your other employees can pick up the slack. Do you have other staff members who you’re holding on to who could pick up that job, or could you divide that job out among the folks remaining? Middleton says, "If that person performs billing, but nobody, including yourself, knows how to put a bill through the system – you don’t want to shoot yourself in the foot."

Small decorating-business owners may be tempted to terminate a high-salaried machine operator, but that may not be a wise decision, according to Freeman. "If you have a machine operator who’s earning you $70 an hour, that’s one of the last people you want to let go," he says. "If you have support staff, a bookkeeper or a customer service agent whose responsibilities can be spread out, that person might be more prone to a downsizing."

Outsourcing may be another cost-effective option for decorators. "Outsourcing through a bookkeeping firm or accounting firm will cost you less money than having full-time support staff in house," Freeman says. "What about digitizers and artists? A lot of embroidery and screen-printing companies aren’t keeping their art services in-house and are looking for companies like mine that will replace that requirement."

Staying SteadyEmployee Shifts

In 2009, significantly more decorators increased their number of employees (21%) than in 2008 (7%). Those adding employees cited hiring part-time workers and independent contractors to run jobs; in 2008 12% of decorators downsized, so this uptick in hiring is to make up for the slight pickup in business in 2009.

The Benefits of Internships

For decorators on a very tight budget, beginning a low-paying internship program may be a smart way to save some money – and possibly find some future standouts for your company.

"Many of our company’s stars started as interns," says Scott Montgomery, principal and creative director of Bradley and Montgomery. "You have to have an eye for talent, but they seldom have the bad habits of people with a few years of experience."

However, it’s important to constantly evaluate each intern so you don’t make the mistake of hiring that person full-time if he or she is not performing up to par. "We usually know before the internship naturally ends, so there have been very few employees we’ve had to fire as a result," Montgomery says.

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