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Kaylia24's avatar
Kaylia24
Contributor 2
2 days ago

How Many Employees Should You Hire First When Starting a Business?

When launching a new business, what factors should be considered when determining the appropriate number of employees to hire?

Additionally, is it more common to compensate employees on an hour basis, or to pay them per project or completed job?

I would appreciate any insight from business owners on what has worked best during the early stages of growth. 

construction
finding employees
general hiring tips
landscaping
property maintenance
reporting & business insights

1 Reply

  • travisshepherd's avatar
    travisshepherd
    Contributor 5
    2 days ago

    Hey there! Congratulations on launching the new venture—taking that leap is an incredible milestone, but man, trying to balance your capacity with your cash flow in the early days can definitely keep you up at night.

    ​When you're trying to figure out how to scale up without breaking the bank, here is the best way to approach staffing and pay in the early stages:

    ​1. Determining How Many to Hire

    • ​The Two-Person Crew Rule: In the home service world (especially for labor-intensive work like painting or pressure washing), a two-person crew is the golden standard. One person working solo spends way too much time moving ladders, staging equipment, and wrapping hoses. Adding a second person often triples your daily efficiency rather than just doubling it.
    • ​Hire for Capacity, Not Speculation: Don't jump into a massive crew right away. Wait until your backlog stretches out so far (e.g., 2 to 3 weeks out) that you are actively losing leads to faster competitors, or when you're so busy in the field that your sales and admin tasks are starting to suffer.
    • ​Start Fractional: Don't rush into full-time W-2 payroll immediately if the schedule isn't filled. Use reliable part-time help or trusted subcontractors to handle the initial overflow until your weekly revenue stabilizes.

    ​2. Hourly vs. Pay-Per-Job

    • ​Hourly Pay (Best for Startups):
      • ​Why it works: It gives you total control over quality. Because employees aren't incentivized to rush, your brand reputation stays protected while you're establishing your name.
      • ​The Risk: You bear the financial hit if a crew moves too slowly and eats into your profit margins.
    • ​Pay-Per-Job / Piece Rate:
      • ​Why it works: It drives serious speed and makes your labor costs 100% predictable (e.g., allocating a flat 20% of the job total to labor).
      • ​The Risk: Quality control can plummet. Techs have a massive incentive to cut corners to get to the next job. You also legally still have to track their hours to ensure they meet minimum wage and overtime laws.

    ​What Works Best Early On?

    ​Start hourly, then transition to performance-based bonuses. When you are building a new brand, quality is your absolute best marketing tool. Start your first hires on a competitive hourly wage so they focus on doing the job right.

    ​Once you get a few months under your belt and know exactly how long a standard job takes, you can transition them to a hybrid model: "This job is budgeted for 5 hours. If you complete it perfectly in 4, we will still pay you for the full 5." This protects your standards while rewarding them for being efficient.  Congratulations and good luck going forward !!!