Planning for Growth

Posted by on October 12, 2009 · Leave a Comment 

Most businesses start out with big heart but little to no employees. This is usually out of necessity because of high start up costs and low cash flow. However, as businesses become more successful growth is sometimes inevitable. With growth comes a whole new set of concerns and a whole new reason to plan and to plan differently. This is especially true when you are considering growth in your own workforce. Employees are the life blood of any business and great employees are not that easy to come by. These are the people that will help determine the success of your company in the long run and so while the selecting of them during the hiring process is critical, so is the ability to keep their talent with you for the long haul as well. What is the number one concern of a potential new employee? That’s right – money. They want to know how much they will get paid and how often. Believe it or not though, money is not an employee’s main concern a year or two down the road. Once they know the business is stable and that the paycheck will be there the employee will eventually disregard the paycheck as the most important factor and instead focus on the intangibles of what the employer can offer. Things such as “work-life balance” and “career opportunity” come into play along with “employee benefits.”

Employee benefit plans are a serious part of any employer’s compensation package. The problem for both the employer and the employee is that they can sometimes get caught up in the complacency of the traditional Employer Sponsored Health Plan. Keep in mind there are literally hundreds of employer health plans out there to choose from. The type of plan you choose should carefully reflect the financial settings of your payroll. If you have employees making average wage then you should be careful not have a dramatically high deductible or out of pocket maximum health plan that would financially destroy your employees if a catastrophic event occurred to them under the plan. On the flip side if you make the plan overly accessible then your utilization factor skyrockets and you will be looking at dramatic premium increases which could affect you greatly as an employer. In the state of Florida alone, employers with less than 50 eligible employees are required to fund at least 50% of the employee only medical premium cost each month for members taking the plan. Considering employer health insurance premiums are arguably high then just factor in a 12%-15% increase to those premiums EVERY year. After a while you will be planning for growth just to keep up with insurance premiums.

The best way to plan for growth is to research benchmark data which will show you what companies of your size, industry and location are doing for benefit packages. This way you will get a good idea of where you need to be as an employer versus your relative competition so that you can attract and retain the best employees to make sure that the growth and success of your business rests on the shoulders of the best employee talent available. This information is available online and through other resources but the best way to obtain this info and to put it into practice is through an employee benefit consultant. The research to find the right employee benefit consultant is a whole other article but the good news is that the process to begin is as easy as picking up the yellow pages.

Filed under General Business