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Advantages and Disadvantages of Hiring Independent Contractors or Employees

You are starting a business that sells pet treadmills. Initial market research shows a potential for high demand in affluent areas and cities with severe weather. You also foresee a lucrative international market and franchise opportunities. You have two options for capital: use your inheritance, which includes a multimillion-dollar home, or allow your two rich friends to join the business. You plan to use traditional marketing and sales methods as well as e-commerce. Before you can go forward, you must resolve and explain the following:

What are the advantages and disadvantages of hiring employees or using independent contractors for your sales force?

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Advantages of hiring contract employees:

Contracted workers have no withholding for taxes; enjoy the benefits of reduced taxes, worker's compensation payments, social security, Medicare and unemployment compensation and companies do not have to pay fringe benefits such as health, vacation and sick pay, etc. It is also beneficial in the area of additional personnel; an employer may hire additional personnel during peak seasons without having to pay for extra full-time employees. Contractors are often cost effective for most small companies. An experienced Independent Contractor can be productive immediately, eliminating the time and expense involved in training employees. Employers typically get a more experienced worker without training and get the job done more efficiently.

Disadvantages of hiring contract ...

Solution Summary

The solution discusses the advantages and disadvantages of hiring employees versus independent contractors in a sales force in approximately 500 words with one APA reference.

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