If you run a small business or start-up, it can be hard to know where to start when hiring your first employees. You'll want to investigate the following questions to see if you are prepared to hire employees.

Signs You Are Ready

According to Small Business BC, if you are considering hiring employees, you should also include HR management in your business plan. You are ready for employees when it will help your company grow and operate smoothly, not prevent it, according to Entrepreneur. Here are some ways to gauge if you and your company are ready:

• Your current workload, and anyone else helping you, has reached a point where you are behind, deadlines are not being met and quality is suffering. A busy work schedule may not be a reason to hire. But if you are not getting products or services into the hands of your customers timely, then it’s time to think about hiring.
• If priorities have shifted and you are suddenly working on other projects while putting others on the back burner, then it might be time to hire.
• You forecast an upswing in business and will need to hire to keep up with demand.
• Your industry shows signs of expanding and you want to position your company to take on more customers.
• You may need to hire to invest in increased capacity or diversity.
• Your company’s expansion relies on people with new and different skills.

Do Hiring Due Diligence

You will invest time and money into hiring the right people. If you’re not prepared for this, you could hire the wrong people, which could cost you even more. It could cost you one-fifth of an employee’s annual salary to replace them. Minimize this risk by making sure you hire the right people from the start.

You’ll need to do the administrative work:

• Get an Employer Identification Number (EIN).
• Set up your records for tax withholding
• Set up payroll and invoicing software.
• Perform verification of employee eligibility.
• Get worker’s comp insurance.
• Post-employment notices to comply with the employment discrimination laws.

To prepare to look for candidates you’ll need to:

• Create a job description that details what you expect from the position.
• Decide how you will train new employees.
• Create a procedure for giving employee reviews.
• Determine what, if any, career path is available for the employee.
• Decide on the process you will use to review resumes and perform interviews.
• Decide on starting salaries and any sign-on bonuses you may need to attract the right people.

Next, you’re ready for the recruitment process:

• Create a job listing to post online.
• Identify the job boards appropriate for your particular needs.
• If you have industry-specific needs, identify the industry publications, websites and professional groups where this job posting would attract the right talent.

It Pays to Post

You may need to pay to post your opening on some job boards. If you're watching your cash flow, you can consider a business credit card as a short-term loan. Research the top credit cards to find the one with the right mix of rates, convenience and perks for your business. Use this card only for your hiring process to easily keep track of expenses. Job listing fees and interview lunches can add up.

This post was written by Robert Carr. Robert writes full-time for small business, finance and car repair how-to sites.