Keeping employees

Discussion in 'Lawn Mowing' started by AMAC, Dec 27, 2003.

  1. AMAC

    AMAC LawnSite Member
    from MO
    Posts: 101

    I need some opinions on how to keep employees. I do not have a huge operation yet (75 accounts) so the pay is not extremely flexible. I have 2 guys and 1 is paid more than the other. I thought about giving 1 guy a percentage (35%) of the accounts that he maintains, so he has more incentive, but I can foresee a lot of problems with this. Also, does any one know what the average % is that an employee receives from the total earnings of a days work? I ask this because I want to be fair with the pay. I understand that pay varies from place to place, but I need some kind of idea. All posts are appreciated.
     
  2. Team Gopher

    Team Gopher LawnSite Platinum Member
    from -
    Posts: 4,041

  3. rodfather

    rodfather LawnSite Fanatic
    Posts: 9,501

    35% is about right for percentage of wage to total revenue.

    I had one person one year that I paid 40% and he handled everything. It worked out real well till he decided to go back to school and get his accounting degree.
     
  4. olderthandirt

    olderthandirt LawnSite Platinum Member
    from here
    Posts: 4,900

    Yea he got his accounting degree and started a-counting the few pennys Rod was actually paying him:laugh: :laugh:

    Sorry Rod, I could'nt resist

    Mac
     
  5. lawnman_scott

    lawnman_scott LawnSite Fanatic
    Posts: 7,547

    I must be totally lost here because i just woke up but.... you are saying give one guy 35%, this has to be the guy that makes more.
    so 1 gets 35%, say another gets 25%, expences are 10%, you get 30%?????????????
     
  6. AMAC

    AMAC LawnSite Member
    from MO
    Posts: 101

    I am not saying that I will give him 35%, I am thinking about it. Is this too much? or should I pay a total of 35% to 2 employees. I dont like this % stuff, but I can't break down the numbers till I know how much business I will have next year. So far from this thread I am Guessing that 35-40% of daily revenue is salary, (based on these threads). The more I pay- the less I have, but possibly, more work will get done and more business I will get, with more money. Who knows the answer to this?
     
  7. zz218

    zz218 LawnSite Member
    Posts: 22

    I have worked a couple of jobs that pay percentages. Quality will suffer guys will be thinking hurrry up get done go home with full days pay. Another problem is they can figure out what you are making doing none of the work and become disgruntled. If i were in this position i would pay lead person 20% other person 15% 75 accounts (average $35.)= $2625 wk lead $525 average wk 40 hours=13.125 hr helper $393 wk 40 hr wk $9.84hr Total pay wk $918 *1.4( cover wk comp & payroll taxes)=$1285 $2625-$1285=$1340 per wk to cover gas, wear and tear on equipment, blades, trimmer string, 2 cyc. oil, etc. $1340-$340 ( to cover these expenses_=$1000 wk your profits=$52000.yr for not doing much wk but billing and going to bank. Your employees are going to try to get additional accounts so they will make more money. Might even offer additional 10% on each new account for 3 months with 1 yr contract.
     
  8. Smitty58

    Smitty58 LawnSite Senior Member
    Posts: 531

    Would you do the same if you were a part timer looking to expand beyond what you can handle alone. I don't have enough to keep another guy busy for 30-40 hrs a week ,but I would like to expand. So lets say you have 30 accounts ,but on your own you can only handle 15-20. Would you hire someone as an employee or a sub?
     
  9. DFW Area Landscaper

    DFW Area Landscaper LawnSite Silver Member
    from DFW, TX
    Posts: 2,116

    From what I've read on Lawnsite, a two man crew should gross $700 in an 8 hour day. (I'm not able to gross anything close to that, but I think I was bidding too low my first year. Either I was bidding too low, or those that said they gross that much were full of it. Honestly, I don't know what to believe.)

    Anyway, if you are paying $10.00 per hour, which I think is a pretty decent wage around the country, each man would be getting 11.4%. This ignores the costs of unemployment taxes, workmans' comp insurance and social security taxes that you pay with each incremental dollar of wages.

    If you've got a two man crew grossing $700 per day in 8 hours, and you pay the lead guy 35%, he'll be making $30.63 per hour. Figure $10 per hour for the other member of the two man crew, and you're out 46.4% of a days gross before paying any incremental costs associated with wages.

    I don't think I'll ever pay someone on a commission basis for labor. With sales it makes sense, but I've never seen anyone do it with labor. As you spend CapEx to increase efficiency, your employee doesn't have to spend any money. But he'll prosper from it just the same.

    Later,
    DFW Area Landscaper
     
  10. kels

    kels LawnSite Senior Member
    Posts: 280

    I have always paid my helper 20% of gross, I have thought about what I would do if I hired an additional employee. I do not think % would work for me if I had 2 or more employees, I guess it would depend on what job responsibilities were.
     

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