Hiring Additional Employees

Space isn't the last of your problems. The more items you sell, the more physical work you have to do. As your weekly sales increase from 10 items to 100 to 1,000, how do you handle all the listing and packing and shipping and such?

The answer is that when you reach a certain point, you won't be able to do it all yourself. When the work becomes too overwhelming, you'll need to bring in someone to help you with it. That's right, I'm talking about hiring employees.

When I say "employee," I'm not talking about the neighbor kid you pay a few bucks to run some boxes down to the post office. I'm talking about honest-to-goodness employees, part-time or full-time, that you write a paycheck to at the end of every week. The kind of employees who call you "boss"which you now are.

Hiring employees is a challenge, a subject worthy of an entire book; I don't have the space to go into all the ins and outs here. Suffice to say you first have to find your potential employees (via help wanted ads and other venues), interview them, figure out how much to pay them, set their work schedules, and then train and manage them. Yes, being a boss is a lot of work; you'll have to devote some portion of your day to employee-related issues, including basic management.

What Should Your Employees Do?

Before you hire an employee, you need to be clear about what it is that you want that employee to do. At its most basic, you want an employee to handle some of your auction-related activitiesto lighten your workload. The question is, which activities do you want your employee to do?

Most eBay sellers hire an employee to do those activities that they either don't like to do, don't do well, or don't add any value by doing themselves. In many (but not all) instances, this translates into letting your employee handle your "back end" activitiespacking and shipping. That's because, when you evaluate what it is you do, you'll probably find that your talents are better suited to purchasing merchandise and creating and managing your eBay listings. It's easier, in most instances, to train someone to pack boxes and drive to the post office than it is to train him or her to create effective item listings.

You should, of course, make your own decision about what you want from your employees. I know some sellers who hire people to go to garage sales, yard sales, and the like, while they stay in the office and manage the other auction activities. Other sellers hire people to take photos and write HTML code for their listings. Deciding what you want your employees to do depends on what you need doneand what you like doing.

Don't Forget the Details

Obviously, a certain degree of recordkeeping needs to be done when your business has employees. You'll have to add your employees to your accounting system, start paying employment taxes, and do all the associated paperwork.

There's not enough space here to go into all the details, but here are some specific things to keep in mind:

You'll need to have each employee provide you with his or her full name and Social Security number, which you then enter on a W-2 form.

You must verify that each new employee is legally eligible to work in the U.S., by having him or her fill out the Employment Eligibility Verification form I-9.

You'll also need each new employee to fill out an Employee's Withholding Allowance Certificate form W-4.

You'll have to withhold the proper amount of income tax from each of your employee's paychecks, which is tied to the W-4 form. Obviously, you don't get to keep the money you withhold; you have to pass it on to the government, according to a predetermined schedule.

Speaking of paying taxes, you're also responsible for paying various federal, state, and local employment taxes, including Social Security and Medicare taxes.

At the end of each calendar year, you'll need to prepare and provide W-2 forms to each employee; you also need to send copies to the Social Security Administration.

Note

Learn more about your tax responsibilities as an employer from the IRS Employer's Tax Guide, at www.irs.gov/publications/p15/index.html.

Sound complicated and potentially messy? It is, which is why now is definitely the time to schedule a meeting with your accountant. And if you don't yet have an accountant, get one.

Another thing to think about is what sorts of benefits you want to offer your employees. These benefits might include paid vacations, health care, and the like. Again, your accountant is a good person to consult about these issues.