Friday, October 10, 2008

Employees with Profit on Their Brains

A company owner is constantly thinking about profit.

A manager is thinking about how to make sure those profits become a reality and how to increase them using a system.

A typical employee thinks about their paycheck at the end of the week (in other words, anti-profit).

How do you get them all to think of profit?

Profit sharing. This means that the better the company does, the better the employee gets paid. True capitalism.

But I know what you are saying, "Why give up the gold?"

Because the more people focus on the gold, the more gold is made -- thus increasing your share of that gold.

For example:

Say your share of the equity of a business is 100% and your profits are 100K at the end of the year with no profit sharing. That's 100K no matter how you look at it. Now let's give up 25% equity to the employees (managers and workers). Those same employees will work harder and have a much keener eye on profit and likely double your profits. So now your share is $150K/year for doing nothing but share the pie.

I'm sorry to tell you this but people work for their own agenda. They do not think to themselves, "Gee, I wish I can make my company more money today even though I only make minimum wage (or average wage)." They have different goals in mind and it is the way it should be.

Think of it this way. Say a company was a doorway. The goal of the company is to keep that door open. If you have one thousand people walking through this doorway (employees) each with their own goal (to get where they are going), both parties get their goal met (the companies door stays open and the employees get where they are going.

Profit sharing makes this easier for them to reach their goals and you to reach yours: MORE GOLD!

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