Employee Pay Information

EMPLOYEE INFORMATION
(The numbers and amounts used in this example are guides only)

New employees start at $75/day salary and split 10% of the gross profit for each job completed. After 6 months the salary jumps to $100/day plus the split.

ASSUMPTIONS:

• $1,000 Average Deck Cost
• 2 decks completed per day
• 2-man crews

If the average deck charge is $1,000, the average cost (including labor) is $450, leaving $550 gross profit per deck.

Assuming you complete 2 decks per day, $2,000 in deck charges, less $900 cost =$1,100. $1,100 less $110 (10% bonus) = $990 gross profit per day.

Weekly, the company grosses $10,000, less $4,500 costs less $550 in commission = $4,950 gross profit or 49.5% gross profit.

Each crew member earns $500 per week in salary plus $275 (1/2 of $550) = $775/week.

Exibit 1: Typical 2 man "woodie" trailer. Shown is 5'X8', also come in 5'X10' and 5'X12'.

Here is the catch: If there are any call backs for any reason, the crew has to return and correct the problem, thus, losing out twofold; 1. They are not paid any bonus for the time they spend rectifying the problem and; 2. They are not earning any bonus on the job they could be doing instead of correcting the problem.

The rest of the story: Every employee is a college graduate, or a college student. A long time ago I went directly to all the local colleges and inquired as to the policies concerning employment of the faculty members during the summer break. The faculty office allowed me to make up a flyer and they distributed it to every member of the faculty. The flyer outlined summer employment opportunities. Almost immediately, I had more prospective (well educated) employees than I could shake a stick at. I was able to hand pick the cream of the crop.

To make a long story short, as time passed the teachers/coaches recruited other teachers and college students and we had/have an endless parade of hard working employees. Remember, when a student or teacher or coach recruits someone, we place them together as a team initially. If they recommend someone and they do not perform, they do not earn the top bonus money. Needless to say, they are VERY careful to recommend only the best people.

Many of the college students who sign on for summer work remain on board as permanent employees. After all, you add in a couple or more high dollar cedar home restorations into the pot and they can earn in excess of $1000/week. We also have programs whereby we hold out an amount of money from their checks during the high paying months and return it to them in the form of matching funds during the lower paying months.

We collect as many job prospects our clients wish done (repair and restore wood furniture, painting, etc.) Basically any project that can be accomplished during the lower paying times. If you are looking for this kind of work, you would be suprised at what you can come up with.

I hope this helps. It will not happen overnight, however, It is THE KEY to forming and building a successful organization. YOU ARE YOUR PEOPLE !!!!!

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could you clarify?

I read the article - interesting, but.... who's going to work for $75/day? And 10% of the gross in those examples translates to a 5.5% of total net profit margin - that's half of my company's net profit!!!! I'd have to work in a 15% net profit margin - still it's an interesting concept. What's the legality of not paying someone to redo their F'ups? I know they get car mechanics to do this - but it must be a special exemption to their trade. Or do you pay guys for their extra hours and just keep tabs on their bonus and use their 'bonus' money to pay for their extra hours?

plainpainter , 2009-12-01 05:53:04 | url

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First point: The amount paid/day is strictly optional as is the percentage of profit.

Second point: All employees agree to the terms of employment in writing before hiring.

Third point: It is the bonus they give up for fixing their errors, not their salary.

If you require additional information, please do not hesitate to contact me.

Mark Smith

Restoration Consulting , 2009-12-01 06:26:33

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Trailer setup

Mark,

Very interesting equipment setup. Front to back, it looks like 1 P/W, 2 airless units and a piece of equipment I cannot identify. What is it?

Thanks.

Rick Petry , 2009-12-09 05:32:24 | url

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Rick:

2 each 4000 PSI/4 GPM Pressure washers and 2 Titan 440i airless sprayers. 200'each reel of pressure washer and airless hose.

Restoration Consulting , 2009-12-09 10:43:36

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2 man crew production

Mark,

Thank you for the reply. Another question!

Your example uses a 2 man crew completing 2 $1000 jobs per day. In reality, I would guess this would correspond to preparing (ie: stripping/cleaning, acid application) a total of 4 $1000 deck jobs per day. Return when dry and stain these same 4 decks, in one subsequent work day.

This is one very productive crew! I can visualize a single crew possibly doing this in a townhouse community or single neighborhood where the jobs are in very close proximity. But it would be a very long day!

I must be getting old and slow, as I do not recall ever completing the equivalent of 3 jobs similar to your example in a single work day. Then again, our customers are usually 20 to 30 minute driving time between jobs.

This level of production may be a good future Ask the Pro! article. Thanks.

Rick Petry , 2009-12-12 04:22:03 | url

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Rick:

Good points: We are endorsed by many HOA'S and advertise in their newsletters (That will be a topic for an upcoming article)It is very common to have a dozen or more jobs within a few blocks of each other.

All crews are under contract and salary, so they can freely work until completion.

Restoration Consulting , 2009-12-12 05:14:01

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Hi Mark, where is the supply hose to feed the washers? And do you ever have an issue of homeowner water supply keeping up?

Don M. , 2010-01-13 06:29:19

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The supply hoses are hung on brackets from the rear lift gate.

The washers are 4000 PSI/4GPM and yes, there have been times a home has not been able to supply adequate water for both units. However, we find that if you hook up to separate faucets on the home, the water supply is adequate for the most part.

Restoration Consulting , 2010-01-13 07:59:30

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All my jobs are 45min to an hour away from base. The terrain can be absolutely treacherous, just check some of my pic uploads. Generally the size of each job is large compared to most of what I'm seeing from other guys in the mix. Rarely under 2000 sq ft and can often be much more. We have a lot of decks with no access except through the house and 12-16' off the ground. I carry 450' of hose all the time on my trailer/tank rig and use all of it at least half the time, so I have to figure in a day of rest between jobs. I can only dream of having small places that close together.

Alan Broom , 2010-01-15 20:55:16

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