I am looking for a new way to pay my installers. I would like them to make a percentage of the labor. This way they work fast & efficiently and make money doing so. I have been trying to figure out a fair way to do it. I am thinking of something like half of the labor rate to the company & half is used to pay an install expense package plus the installer.
There are some problems though, what about defective equipment and other non billable jobs.

Is anyone using something like this?

Jason Walter
Electronics2You

That is always a tough matter....I think it should be a higher base pay and a quarterly evaluation of performance. If performance is up to par, then they receive the incentive. Although, you must remember ALL of the things the employee did, not just the two weeks before the incentive review!!

This takes care of your other two problems....as far as your incentive, you'll have to decide on what you think is fair. Here's where accurate time sheets and job logs are helpful.

Jason, how about a percentage of the profit? Find a way to calculate the time the job should take, or assign a flat rate to the job. If a 20-hour job is completed in 16 hours, they still get the 20-hour pay. That equals more per hour.

Larry
www.fineelectricco.com

Must also have QUALITY in the equation.. I am not an installer, just a end user but if I knew he got paid based on how fast the job was completed... :P

That's what I'm considering, along with a lesser base pay so they still make $$ if they are driving for example.

Any other ideas would be great.

We have calculated how long each part of the installation should take and then we add about 20% and we pay an hourly rate to complete the job. This includes terminating, testing, and signing off on the install. If they do it faster, great. If something they signed off on isn't correct they fix it for free. Incetive to work fast and do a good job.

As an installer I must admit that even though the incentive ideas may seem to be good motivators, I personally would rather just get paid by the hour and concentrate on doing a good job, instead of trying to be fast and make more money. But I'm sure that this doesn't work for everyone, (it wouldn't work with the kind of guy who says to himself that the longer it takes the more I get paid). I just figure that I should get paid what I'm worth, no matter what I'm doing. But then again I guess I'm just kinda sick of the way I'm getting paid right now, and wish it were different.
I'll admit that this wouldn't work with everyone, but I like the idea.
BTW what do most of you guys charge /hour to your customers on average, or do you bid the job?

This message was edited by Brent Southam on 12/21/01 01:56.34.

i agree with brent....doing a better and higher quality job is much better then putting in the equipment fast.... doing qaulity work along with having and developing good relationships with customers will do an immense amount of "word of mouth" advertising for you.... i would rather get payed for the quality, the knowledge, %10 product commision on jobs or "extra's" or "add ons" that i have talk to the customer about, and programming wages which is comparable to OT time....and the most important part making sure the customer KNOWS how to use the system and is HAPPY with it..... like ir or not most of these rich people golf and know each other....if you do good work.... and follow up with quality customer service.... you'll build an incredible reputation and customer base... robert

Regardless of how good an installer might be, when you start talking about incentives for cutting time off of jobs you run the risk of having them cut corners.

Take the total of all money for all installations and let it add up over a quarter. At the end of the quarter, take a percentage (20%?) of that total and split it up between the installers. Not an incentive but a bonus. Different language - same bottom line. Any call backs are deducted from the quarterly total, thus less bonus paid out.

Marcmc-
I think I like that one

I think you guys may have missed my point. I am not offering incentives to "cut" time. What I offer is more than adequate time to do the job right in the first place. I usually allocate about 20% more time than I think the job will actually take therefore if they finish on time they will actually be done early. The catch is that they must test and sign off on every installation, if there are call backs they don't get paid for the fix. We tried the quarterly bonus thing too and found that installers began to expect the bonus and were setting there budgets as if this money was guaranteed. I do reward exceptional work and pay comissions for sales made on the job. I would gladly pay a lot of money to an installer who can completely take care of a customer and bring in new business with a minimum amount of supervision from me.

I have been on both sides of the money issues.....

I liked the incentive to be paid for the estimated time if you finished in less, but then there always is the custom "aspect" of the install...How do you estimate custom besides T&M (time and materials)

Im now on the hourly and receive quarterly bonus amounts, but only if my billable time is over a certain percentage and not time spent milking the clock....

Here is the bad part......I can do a small trim in half the time as some of our other installers and I get back sooner......Guess what.....It rewards me with ....more service calls or more work on that day!!....How is that for being quick and efficient!...Plus any extra sales that I can interest the customer in as we talk and install does nothing for my pocket..just more work...No big deal to me but you always can plant an idea and watch the customer just crave that little extra because his installer was hot on the idea.....Its like a stock tip from a good investor...WHo wouldnt be interested......

Bottom line....efficiency bonus and percentage on upselling.....

Make your installers happy and they will gladly help you thrive.....

My 2cents

There are so many possibilities that could go on here it will be very difficult. That's why my initial recommendation of accurate time sheets and remembering the whole quarter, or year, or what have you, for bonus dollars works best for me. At the end of the said period I can look back and see who worked the most efficently and if there were any customer callbacks with praise for a specific installer etc....just my 2 cents. Building a good relationship with your installers is very important, they are the front lines and can really make or break your company. More so than the salesmen.

Amen on the upselling bonus. Make it a commission just as if one of the salespeople had done it. Paid THAT week. And I understand about being able to do better work in less time but still getting the same bonus. In that case it is up to the owner to figure out who is doing the best and most work, and reward them accordingly. When I said to split up the percentage between the installers I didn't neccesarily mean to split it evenly.

Just a small question (especially for marcmc... he seems to be on the same page as I am!) If you were to give an upsale bonus, what happens when I tell the customer that the MX-500 that the salesman sold them is not what they're looking for, and that they need a Pronto, (ie. difference of $200.) Should I be able to shaft the salesman of his commision for the original remote, and I get the whole commision on the $400, or should I just get a commission on the difference between the two? This happened to me just last week, and I still don't know how I'm going to get paid. I was just wondering what you guys would do?