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Suggestions How much should I pay an employee?

Discussion in 'General Chit-Chat' started by Shamil, Nov 30, 2017.

  1. Shamil

    Shamil New Member

    May 8, 2017
    Dallas, Texas
    Hey guys. I've got a small operation that I am seeing less and less time for these days. My main employee Jack has been doing everything (besides the books) himself. We do car wraps so he's designing the wraps, printing them, and installing them. He's also been handling our web advertising and social media accounts, which is part of his job. I wouldnt call him a secretary but he answers the phone in my absence (which is pretty much all the time now).

    I'm thinking his salary and trying to figure out what a good number would be, considering that he does the wraps himself now and is also customer support. Should it be based off the industry standard, or how much money we bring in at the end of the year?

    Any input would be great. I feel like I have to figure something out since I dont plan on being as available as I used to with a couple other ventures I have going.
  2. AKwrapguy

    AKwrapguy Active Member

    Sep 6, 2014
    Anchorage, AK
    I think you need to think more about what it would cost to replace him if needed and how much it's worth to keep him. A Jack of All Trades is a difficult type person to find and keep happy. What are you paying him now? Has he asked for a raise? Have you thought maybe about a base salary and commission? Do you offer any type of benefits? Has there been any type of growth that would require the hiring of another employee? I think you have to look at what your profits are and what you can afford. What are paying him now?
  3. Texas_Signmaker

    Texas_Signmaker Very Active Signmaker

    Oct 21, 2016
    Frisco, TX
    If he's running the show and acting like an owner...and your going to be moving in the direction of an absentee owner, you may consider giving him some equity stake in the company. Giving him some equity would validate his "ownership attitude". Sharing the profits and moving away from salary would encourage him to really feel invested in the company and less likely to leave (so long as business is good!) If you ever watch "The Profit", Marcus does this when he buys a company and sees a star employee that he knows he can't afford to loose.
    • Like Like x 7
    • Agree Agree x 3
  4. Rick

    Rick Certified Enneadecagon Designer

    Apr 17, 2003
    Valle Vista
    My burning question is...

    What do you want to do with the business?
    Seems like not a huge return on a one man business...

    First: I would not rely on one person running the shop, I would have 2 people at the very least, if your one employee leaves, you have a back-up.
    As mentioned, give the guy a stake in the business or pay him based on sales and work completed, that way he has a reason to succeed...
    • Like Like x 3
  5. ams

    ams Very Active Member

    Oct 28, 2010
    I would say start at about $15/hr
    • Disagree Disagree x 6
  6. myront

    myront CorelDRAW is best

    Dec 3, 2015
    Niceville, FL
    In Dallas? $20/hr min or consider hiring another. How will the guy take a vacation?
    • Agree Agree x 2
  7. Starter

    Starter Member

    Mar 20, 2013
    Halifax NS
    45-50K a year. If you want to keep him. Whatever you decide....I would make it worth it to him to want to stay and not be tempted to start his own shop with your clients. Seen it a thousand times......it has happened to me.
    • Like Like x 3
    • Agree Agree x 3
  8. JgS

    JgS Member

    Dec 8, 2012
    Make him a manager or part owner at around 45k and hire him another employee for support.
  9. Billct2

    Billct2 Major Contributor

    Mar 12, 2005
    New England
    I don't know, but with his skill set and depending on his personal circumstances he could easily leave tomorrow and start his own shop. So the idea of getting him vested in the business is a good idea.
    • Like Like x 1
  10. PB33064

    PB33064 Member

    Nov 30, 2017
    Definitely hire another to train and learn what he knows. I doubt you will get as lucky to find a one man show like you have in this person, but you need a backup. Sounds as if he leaves you will be shutting your doors.

    If he's that good, give him a stake in the company vs the commission. Commission is great but not a reason to stay if he knows the real money to be made, and it sounds like he does.
  11. Eric Butler

    Eric Butler New Member

    Jan 25, 2017
    Pay depends on the market but make sure you give him some equity. Skin in the game is a great motivator. You could also bonus equity based on profitability or sales targets.
  12. Johnny Best

    Johnny Best Very Active Member

    Dec 9, 2015
    buffalo ny
    I think you should give Bob Cratchit a raise for all his hard work and go and buy the biggest turkey for his Christmas dinner and last of all, give him good health benefits so his son Tiny Tim can get the proper help he needs.
    • Like Like x 1
    • Agree Agree x 1
  13. Gino

    Gino Premium Subscriber

    Jun 7, 2006
    Sell him the business and let him figure out how much he wants out of it.
    • Like Like x 1
  14. papabud

    papabud Lone Wolf

    Mar 7, 2016
    Toledo, OH
    i am leaning towards gino's suggestion.
    talk with him. be honest with the state of the company and how much money you have to work with. let him decide if he needs more money or use some of that money to hire another employee.
    this is a great time to make a 5 or 10 year business plan. involve him on what that plan will look like.
    give him a part of the company if you can. and remember someday you will retire and either sell or close the shop.
    might consider a long term plan on him buying it over time. or just outright giving him full ownership.
    if you just pay him a fair wage. he will leave. he will either see more money somewhere else or get burned out.
    but since he is pretty much running the shop for you. let him. give him something to work towards. reward him.
    • Like Like x 1
  15. spectrum maine

    spectrum maine Member

    Nov 1, 2012
    biddeford, maine
    35-40k minimum plus a few % of the true profits. or a small commission on all the jobs he gets that over 1,000$ ( that way he chases the "bigger" jobs). another question... would he make a good boss/supervisor? if it is just him i would think it would be hard to turn much of a profit (after overhead).
  16. bob

    bob Major Contributor

    Nov 4, 2005
    How much an employee should be paid depends on how much additional revenue you will net from that employee's presence. However much that is you must pay less than that number. Very simple, there are no other considerations.
  17. DerbyCitySignGuy

    DerbyCitySignGuy Very Active Member

    Dec 12, 2013
    Not a lot of information to go off of, but if you're paying him less than $20 an hour you're going to risk losing him. He's got a valuable skill set. If you don't keep him happy, all it takes is one headhunter to poach him.
  18. equippaint

    equippaint Very Active Member

    Oct 10, 2014
    Im with Gino here too. 1 man show that you are leaving to an employee so you can go do other things. If he leaves, there is no value left in the business so get it while you can.
  19. StarSign

    StarSign Active Member

    Sep 20, 2011
    Southern Utah
    Can I get his phone # and is he willing to relocate?
    • Like Like x 5

    BIG EASY DOES IT Very Active Member

    Mar 14, 2011
    More based of industry standard for all the tasks performed. But be sure to keep him happy. It sounds like he is your business. If he leaves you would have no time to run it yourself or other trained employees that could pick up where he left off.
    Leave yourself the option to give a nice bonus the end of each year based on the income for that year.
    • Like Like x 1

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