Dear Adam Smith: Entrepreneur Inquiring

division of labor adam smith division of labor dear adam smith

Hire a partner or a part-time employee? Adam Smith is here to help a craft soap maker clean up her thinking on a murky choice. 
Dear Adam Smith, 
I’m writing to you to ask for your help. I’m the owner of a small, craft soap making business. I’ve been moderately successful launching but am struggling to take my business to the next level. The big challenges I’m facing are getting better distribution for my goods, and spending too much time making and packaging products. I’m thinking of bringing in a partner, similar to me, who can share the work with me but of course that would require me to pay a lot or give him or her a part of the business. What do you suggest?
-Hoping to Clean Up

Dear Hoping, 

Thank you for writing to me about your work. I am honored to be trusted with such an important inquiry. I suspect that you may be overlooking a superior option to the one you suggest. No one you can hire will care as much about your business as you do and as you said, it would be costly to bring in someone at your level. However, you could consider hiring someone with less experience, who would cost less, and have them take over one or two small parts of the work so that you can focus on other parts that require more of your skills. . 

Perhaps you could hire a student or someone who wishes to work part time to help with one specific task that is both time consuming for you but does not require any particular skill. Perhaps making the soaps? As a benefit when one person focuses on one task they become better and faster at it and occasionally find ways to improve the process. 

There is a story I have told in Wealth of Nations that you might not have heard: 
In the first fire-engines, a boy was constantly employed to open and shut alternately the communication between the boiler and the cylinder, according as the piston either ascended or descended. One of those boys, who loved to play with his companions, observed that, by tying a string from the handle of the valve which opened this communication to another part of the machine, the valve would open and shut without his assistance, and leave him at liberty to divert himself with his play-fellows. One of the greatest improvements that has been made upon this machine, since it was first invented, was in this manner the discovery of a boy who wanted to save his own labour.
Perhaps the laborer you hire will make similar discoveries that will benefit both of you but even if not, you will have freed up some of your own time without having lost more money or a part of your business. 

Please let me know how your business does. The prosperity caused by business and the challenges with this process are a particular interest of mine. 

Yours in Fellow-Feeling,
Mr. Smith

Editor's Note: Letters to the "Dear Adam Smith" column are not, of course, answered by Adam Smith. He died in 1790. Letters are answered by Christy Lynn, Sarah Skwire, Caroline Breashears, Janet Bufton, and Renee Wilmeth. Advice is for the purposes of amusement and education about Smith's thought. We do our best, but caveat emptor and follow our advice at your own risk.