Profit sharing

[FireFighterZero]

What about a promotion?

 

[Chris E]

Exactly what Justin said, the profit figures could be good, average or bad but should be irrelevant to anyone that's not a partner or part owner, imo.

 

[matdand]

Exactly what Justin said, the profit figures could be good, average or bad but should be irrelevant to anyone that's not a partner or part owner, imo.

Well anyone who is doing sales would have to know the daily numbers at least, from there he can extrapolate. Also, it would be hard to hide my profits if they know thery are getting a percentage of said profit...the math would be pretty simple.

I have heard mixed ideas about revealing numbers. The downsides are obvious. The upside, apparently, is that employees get to realise what the costs of running a business are and how much time and work is involved. And posibly the incentive that the company making more money means they are making more money.

I have never heard someone who works at GE or Pfeizer complain about their wages because they know what the company profits are, why would it be different for a small company?

 

[cory]

I recc'd your plan above but then was thinking about the revealing the profits issue. In a small tree company I think it could be an issue, at GE no one cares cuz the numbers are enormous and the company is a large and impersonal corporation on the whole and each employee is an extremely small cog in the machine, whereas yours is a small company headed by you. Some guys may get their nose bent outta shape if they look at the gross and then see their relatively small cut even if their share after all is said and done is good and fair. You know the war that is running a small business but most of them won't understand unless they are actually in your shoes.

Profit sharing is a good topic but it's tricky imo. I wonder how a large tree co like Davey does it, maybe Jed will chime in.

Fwiw, I go out for pizza and beers a fair amount with my guys, just beers too a fair amount, and I buy em a lot of gas and otj food, occasional bonus after a big job, lots of early/short days, and paid vacay and year end bonus. Almost went on 2 big trips with them but they never came to fruition.

 

[MasterBlaster]

That's cool!

 

[squisher]

Beer was my most often used bonus system too. Kind of risky for a bigger outfit though. I was always a small fish. One to two employees. Christmas bonus too, but it was never that big. Tight time of year around here often then, but I always had one and it was always cash.

 

[ruel]

Bump thread,

I've been thinking about this subject and lot recently, trying to figure out if I want to continue being a climber employee.

It can be demoralizing from this position to think about what the company charges for me vs. what I get paid. I know there are overhead costs of having an employee, but what does that really add up to?

Why is it hard to find climbers for most companies? From the saddle it looks like I'm taking all the risk. If things go badly, I might die, or boss may lose some money. My body on the line vs bosses coin seems pretty unequal.

I think being 100% aware of the books would help alleviate that feeling. I'm happy to make money for a someone who is finding me work. I'm not looking to make someone more money per hour than I'm getting myself.

My area has 4 tree companies with multiple employees and about 20 solo guys/informal subcontractor partnerships. Seems to be the market is speaking, at least around here.

Rant!

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[SkwerI]

Speaking as somebody who has finally taken on an employee after 30 years of refusing to have employees, I have an opinion on that matter. My employee is great. He works hard, thinks ahead, is careful with my equipment, anticipates my needs and most importantly he makes me money every day. But what he doesn't have is any skin in the game. He brings himself to the table, nothing more. I bring myself, my equipment, my trucks, my insurance, my sales, my licenses and business permits and my reputation. I have well over a quarter million dollars invested in my business and my employee has nothing invested. Why should I pay him a bigger return on an investment that I made and he hasn't?

Your worth is based on not only your skill, but what you bring to the table. Bring along a $50K bucket truck and watch your value double (or triple). If all you bring is a thousand dollars worth of gear and a couple saws, then you will get paid 1.5 or 2x as much as the ground guy who brings nothing.

 

[SeanKroll]

Ruel, you can't/ won't want to climb forever. Developing your own client base and building your biz, including establishing biz credit for buying equipment, while collecting a check from someone else seems to be many people's recipe for success.




Anyone who wants to show profits/ give percentages, should also show a log of hours off the jobsite for billing, bidding, repairs, licensing, etc, etc. Show the cost of worker's comp, costs for repairing equipment, GL insurance.

If the boss is clearing 20K profit, and has 20K invested its one thing. If they're cleaning 20K a month, and have to manage 10 employees, and have $3M invested, its different worlds.




I was wondering recently, what people's Gross Revenue: Net Income ratios are like.

I kept over half my revenue. I imagine larger corps don't, in part because I am not accounting for all the hours I spend working. Actually, i have no idea how many hours I work in a year.

 

[MasterBlaster]

Why should I pay him a bigger return on an investment that I made and he hasn't?

Yep - spoken like a true owner.

 

[Mick!]

A few years back a client came out and added a cherry tree as an extra, I said €200, client said yes, the groundy started on how he was doing extra work and I was getting an extra 200, what does he get out of it?

I said you get to keep your job.

TBF he shrugged his shoulders and got on with it.

 

[MasterBlaster]

I'd say more time on the clock.

You're welcome.

 

[Mick!]

Day rate Butch, job and knock.

 

[Bodean]

Like Brian said...What do you bring to the table?

I wince when I think of someone else doing one of my jobs without me....unless I had known them for years...

Or like the big companys. Fill a uniform with a human and tell them to cut trees safely from this bucket truck.

Not everyone wants to be an owner.

I've heard of employees getting their wage and a % on the days job.... I've never done it.

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[SkwerI]

Yep - spoken like a true owner.

I'm not sure if that was condescending or complimentary. However, if anything I'm guilty of paying my help too much. I pay him a generous day rate even though most days we work 6 hours or less. I split tips with him 50/50. I supply a packed cooler of waters and gatorades every day. I buy lunch almost every day. I always make sure we have an easy Friday since he has to pick up or return his son every Friday afternoon (shared custody with ex). In fact I try to pay him as much as I can without ruining our working relationship. He's making a hell of a lot more than I made at his age/position even taking inflation into account. He makes 15-20% of gross or more. And he still doesn't have two nickles to rub together at the end of the week.

 

[stig]

Brian, for what it is worth, as another owner, I completely agree with what you wrote.

 

[Bodean]

I get paid the same hourly as my help....and my wife....

The company that pays us gets the rest to keep us all paid.

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