Having a small businesses, or a startup business, there are many risks and rewards to be made. In order to minimize any of your losses in the world of a startup business, entrepreneurs must learn how to manage their cash flow, understand their costs and really get a good estimate of what their “real” revenue may be.
There are plenty of times reading your financial statements can throw you off, or mislead you in the true net worth of the fiscal year if you don’t know how to read and interpret the numbers of your accounting statements correctly.
So what I am ultimately trying to say is, money is really important for all businesses, especially if you’re a small to medium size business. Knowing how to spend your money is important, knowing how to invest and save is also important as well. Knowing how to read your financial sheets is important. But there is a solution to the worries of money, and that is to make more money.
In order to make more money, it’s important that you hire working and helping hands to help your business grow. But here’s the catch. As a startup, or a small to medium size business, you will have to spend money to pay your knew employees’ salaries. This is a catch – 22, in order to make more money, you have to invest more money into your investments and employees.
Employee Pay Options
One great investment is hiring employees that are capable to help your business grow. But what if you are too worried about draining your cash reserves? There are plenty of employee pay options that can fairly compensate new employees, so you can get your small business off the ground.
Offer Stock Options
One option to compensate employee pay options are to offer competitive stock options. Paying employees with competitive stock options is not a new method, it is a very common method actually. This employee pay option tends to attract the best talents without having to pay or offer a large salary. If you hire employees who believe in your company, giving equity as an employee pay option will make your employee work harder, so that they could “cash in” on the future growth of the business they work for.
Utilize Internship Options
Although, this is not much of an employee pay option benefit, small to medium size businesses tend to hire unpaid interns in order to save money for working labor. There are plenty of students and graduates willing to take advantage of unpaid internships only if the business they intern at provides real life working experiences that will help the interns advance their careers. If business don’t provide to interns the necessary work experience interns seek to gain, your intern may quit on you. So make sure you communicate with your interns, and make sure your interns are happy with the work you provide for them. In order to get valuable free work from interns, make sure you provide to your interns the growth and skills they seek to build themselves into valuable assets in the business world. Be a mentor for your interns, they will be appreciative of it.
Contractors and Part-Timers
Another employee pay option for startups and small to medium size businesses are to hire contractors or part-time employees to do your work. Outsourcing contractors can be very cost effective. With new competitive startups and technological innovations, outsourcing is becoming easier to provide with less overhead costs to pay for.
Part-timers are more or less stay-at-home moms and dads. Most part-timers are considerably very talented. Although employee pay options for part-timers may be half than a full time employee pay option, there are tradeoffs to part-time work. Although there are plenty of people looking to do part-time work, a lot of part time workers cannot be expected to prioritize your work responsibilities over family and personal obligations. Also, since you are not providing enough employee pay options in terms of health care, child care, and other benefits, part-timers may feel disenfranchise to complete focus on your cause as a business.
Offer Defer Compensation
Another employee pay option include defer compensation (definitely consult with an attorney if you ever choose this option). Defer compensation as an employee pay option involves defer paying employees until certain established and agreed upon milestones and requirements are meet. This can be in forms of a cash bonus or back-pay that isn’t cleared until your company earns a certain amount of revenue or profit. You can also include tying salary payments and raises to specific performance achievement as an employee pay option.