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Entrepreneurial Capitalism Uncompromised

(BIZTALKRADIO) SHOW 13: PROBLEM 1 - RAISING WAGES - WILLIAM EASTMAN

1/10/2021

1 Comment

 
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The next few shows will highlight problems business owners are having with talent.  Whether the issue is attracting, selecting, training, keeping, or compensating, this part of the series starts from the problem and works backwards. The first 12 shows focused on starting at the beginning - what and how to build an Employer of Choice operation. 

SUMMARY
Although this has been universally true for years, in the post-pandemic world it has become truer - is that even a word?

Not matter how small, the level of professionalism required for managing HR - people - has reached extreme levels. Small business owners in the past could manage all of the hiring, training, paying etc., or delegate to someone in an non-operational role like the accountant. I wish we were still in the world, but we're not. 

That is one reason for this show series - be your HR expert without paying for it. Now that is a deal.

TOPICS
  1. Increase pay and benefits without raising prices - HOW?
​
INSIGHTS
Labor costs, dependent on industry, should range between 20% and 35% of sales. That means for every dollar collected from a customer, 20 to 35 cents is a contribution to their compensation. If we start our thinking here, then it is possible to raise compensation without raising prices.

I will leave reducing costs which is another method of attacking costs for another show. Today we are going to stay simple - baseline your sales at 3 levels - best, worse, and mean - not average.

ACTION
  1. Baseline you sales to provide a representative number.
    1. Best, Worst, Mean
    2. Day of the Week
    3. Hour of the Day (Shift)
  2. Determine how much more you can afford to pay on the additional dollar. As sales increase your margin per sale will also increase, how much of that can you contribute to wages / salary.
  3. Present the new compensation system to employees. Physically demonstrate how it works by creating a test week (last week) and show them how much more they would have made under the new system.
  4. Create a visual tracking system where the information is appropriately posted. The scorecard needs to be updated frequently by them. Also ensure that computing the 'commission' for performance is easy to compute.
  5. Test for a month and adjust as necessary. The decision criteria:
    1. You margins and net revenue (after commissions) has increased
    2. Your employees are the best paid for your industry in the local region.

"The World Of Business At Your Finger Tips"
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If you have any questions or comments related to this Show, please use the Comments Section below. Also what specific people problems are you having today with opening your business at full capacity or running it at that level - please leave those issues here. We will contact you on the show date your issue will be addressed.​
1 Comment
thebudgetguy link
21/5/2022 07:54:28

The situation in my small business is that after a certain amount in the neighborhood of $27.88 per hour, a wage increase does not result in a noticeable increase in employee productivity. I think a lot depends on the specific situation, but in my case the salary issue is very complicated.

Reply



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  • WELCOME
    • EXEC TEAM
    • CONTACT US
    • PRIVACY
  • RADIO
    • ON AIR NOW
    • LISTENER GUIDE
    • SHOWS ON DEMAND >
      • BUSINESS PODCASTING MADE EASY
      • ECONOMIC NEWS >
        • IBGR.News
      • EXIT STRATEGIES >
        • An Epic Business Exit
        • Catalytic Conversation$
        • Exitology
        • The CFO Perspective
        • The Entrepreneur's Edge
        • The Smart & Savvy Business Exit
      • FINANCE >
        • Business Econ for a Post Pandemic World
        • Economics For Owners
        • Employee Capitalism
        • Money Matters
        • Practical Solutions to Difficult Problems
        • TurboCharge Your Business
        • Your Money Machine
      • HR / PEOPLE SKILLS >
        • Business and Beyond
        • Business Processes & People Talk
        • Equipping Others
        • Staff It!
        • Success Can Be Fun - With Focus!
        • The People Side of Business
        • Women of Business Thriving
      • INTERVIEWS >
        • Get You Noticed!
        • The Referral Guy Interviews Your
        • The Magnetic Voice
      • LEADERSHIP >
        • Compassionate Leaders of Influence
        • Destiny Road
        • Engaging Your People For Success
        • Leadershift with Col Ajai Lal
        • Leadership Powered by Common Sense
        • Influencing for Global Impact
        • Talk Leadership with Cedrick on the Radio
        • Your Corporate Confidante
      • MARKETING >
        • Building A Multilevel Marketing Empire
        • Level-Up Your Marketing
        • No Nonsense Market Domination
        • Buying Customers
        • #Seriously Social
        • Results Oriented Marketing
      • MINDSET >
        • Building Success Habits
        • Building You to Build Your Business
        • Entrepreneurial Mindset
        • Peak Impact Mentorship
        • Guidance To Wealth
        • The Hero Within
      • OPERATIONS >
        • Build It!
        • Building In Front of You
        • Building In Front of Your 2
        • Lead Lean
        • Pencils & Pistons
        • Planning Out Loud
        • Processes Under Control
        • The Ralph Peterson Radio Show
      • SALES >
        • Beyond The Method Selling
        • Inside The Customer
        • Sell It!
        • Serving Up Sales
      • STARTUPS >
        • A Business Primer for Startups
        • A New Business Model For Startups
        • Adulting In My Purpose Business Edition
        • Building Startup Operations
        • Creating A Consulting (Improvement) Business
        • How To Start A Consulting Firm
        • Survival Mode
        • The Geriatric Entrepreneur
        • Your Business 2.0
        • Z Gen Entrepreneurship
      • STRATEGY >
        • #OwnrLife
        • Better Your 4 U
        • Build Your Core for Dynamic Partnerships
        • Grow It!
        • How to Avoid Becoming the 80%
        • How To Become the Top 5%
        • How to Move Beyond the 15%
        • Living the Life .. On YOUR Terms
        • Own It!
        • ReImagine Your Business
        • The Business Owner's Bookshelf
        • The Self Managing Organization
        • Tenacious Top of Mind Business Insights
    • MEET THE HOSTS >
      • Ben Gioia ("joya")
      • Bert Robinson
      • Chris Mayfield
      • Crystal Y. Davis
      • Donna Kunde
      • Doug Thorpe
      • Ellen McIlhenny
      • Glenda Thompson
      • Jason "Wally" Waldron
      • Jeremy Gray
      • Jörn "Joe" Menninger
      • Kevin Beers
      • Lisa Askwith
      • Londina Cruz
      • Mike King
      • Monique McDonald
      • Patty Lawrence
      • RJ Lewis
      • Sarita Johan
      • Steve Sweeney
      • William Eastman
    • JOIN THE TEAM >
      • BECOME A HOST
      • BE A SPONSOR
  • CONSULTING
    • HOST PACKAGES
    • ADVERTISING PACKAGES
    • BUSINESS MAKER PACKAGES
    • FRACTIONAL CONSULTANTS
  • NEWS
    • E-NEWSPAPER
    • NEWS BLOG
    • NEWS PODCASTS
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    • START HERE
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