Thinking about performance pay but don't know where to start?
I run into a lot of owners who want to set up performance pay and don't know where to start. My answer is always the same: figure out your labor cost first, then build everything down from that number. Labor cost is your tech wages divided by revenue. For HVAC and plumbing, around 20% is healthy, for landscaping and window washing, anywhere from 30-35% is healthy. Find the weekly revenue each tech needs to hit that number. Example tech at $35/hour: $35 x 40 hours = $1,400 weekly wage $1,400 / 0.20 = $7,000 weekly revenue target Under $7,000, he gets his hourly. Over $7,000, he earns a bonus on every extra dollar. Keep that bonus rate at 20% or less and the bonus never pushes your labor cost past 20%. His production goes up, he takes home more, and as long as your bonus rate is under 20%, his labor cost percentage goes down. Once you know your number, you can layer in tiers and spiffs without guessing. Do you know your labor cost percentage off the top of your head? And if you're already paying performance pay, what does your structure look like?Strategies / Suggestions for hiring manual labourer for a niche Biz.
Fitness Equipment Service Technician - Rock & A Hard Place 26 yrs at this and I cannot find my A-Player. Sorry, this is quite the essay from the heart of frustration, so if you make it to the end and have some valuable suggestions I can implement, beers are on me at this conference. 🍻🍻🍻 It’s been beyond frustrating with people lying on resumes until you see they can’t do what they say. OR They can’t follow the simplest of instructions and policies like... If ever unsure about what you're doing or need help of any sort, contact me, I’m ALWAYS available. Then they decide to go Cowboy and try to figure it out themselves, which I certainly encourage as that's how I learn best. Trial and error where just getting your hands in there, coupled with some well-lubricated gray matter, and things start coming together and making sense. But not to the point of adding additional unnecessary "HRS" not MIN, to an invoice I can’t charge for, but they expect to be paid. In my instructions, I let them know, even when right beside them during training, if they get stumped on an issue and they ask for advice, I tell them to run through some process of elimination and try to figure it out themselves without me constantly telling them. I'll let them go for 10 to 15 minutes, and if the lightbulb isn't flickering, then I'll methodically walk them through what I would do. This way I'm not just jumping in and doing it for them, but they're actually learning hands-on. It's when they decide to go cowboy rogue and spend way too much time trying to figure it out instead of calling me, then they expect to be paid for these hours I can't bill back to the customer. How do I tell my customer that we're overcharging them because my guy doesn't know what he's doing and wants to learn on their equipment Then he'll make a note of whatever the issue is and what their diagnosis is, which can include needing to order parts. I'm thinking that they didn't have an issue with the diagnosis and it was a cut-and-dry scenario and, hands-down, this is what the customer needs. Then we'll order wrong parts... not only costing money—which will be either out of my pocket or the customer's pocket upfront if the quote is over $1,000—we have to wait usually about a week for parts to come in, set up another appointment, and head back out to the location to rectify the situation. - Part gets installed, doesn't fix the issue, and we're back to square one. Tech expects to be paid for travel & time for his mistake. So I put in the contract that I backpay my techs by two weeks with the clause that this will cover any potential damage to customer property due to their negligence. Residential customers get invoiced and are expected to pay more or less immediately, and commercial customers are net 30 for the most part in a perfect world. So it kind of evens out to cover their pay if something were to happen. So what do I tell my customers now? "Sorry, my guy effed up. Now I have to go out there and diagnose it properly, and if you're lucky—which happens more times than not—it's just a matter of some adjustments that need to be made, and no part was needed after all." But the other side of that coin is a part is actually needed, so we have to run through the process again and face another week's delay. Then I feel in good conscience that I need to discount my customer and hope this hiccup isn't enough to lose them and they're gracious enough to understand. OR Lack of communication in general. I can't stress enough and tell them it’ll make us or break us if honesty and just pure, actual communication isn’t kept up. I make it very clear that if they're not happy with how things are going, my door is open and I am more than happy to discuss what's going on so that we can make an adjustment that works for both of us. 'Cause if I don't know, I don't know. And that goes two ways. I let them know I'll do the same for them. So it boils down to the fact that if they can't do it right, I might as well do it myself? PSA - common sense is not so common. LOL I refuse to drop my standards as we do charge a premium, and I would consider us to be a "boutique" service company as we have—or I should say I have—an incredible track record and can probably still count on one hand how many callbacks I've ever had. Even though we are the highest-charging company locally, if not regionally, I make sure that I add enough value to the customer so that they know they got their money's worth and then some. So how do I justify that when I have subpar techs going out and serving these customers with guarantees that I've made that don't get fulfilled? I tried doing the employee thing once and that was an absolute nightmare, so I only look for contractors now. I'm willing to pay good money for somebody who can prove themselves to me. If they have the drive and are willing to learn and be moldable, then they can increase their pay in a short amount of time. !!!!! So you can only imagine, after 26 years of working on the tools and without seeing any hope of getting off the truck in the near future, my drive, my mental, and my physical well-being are being stressed to the max! I even had a scare of a panic attack, so I was told. That kind of shit just is not in my vocabulary or in my DNA, but I was getting signs that were pointing towards a heart attack that did put me in a hospital for a day, but I checked out just fine. SO... FWD to today, things have gone from bad to worse. Financially, I can't even hire anybody in order to pay them as I can't even bring in enough to cover our own payroll, yet the hours that I work, no sane human should have to be exposed to. No word of a lie, I'm on the tools all day, usually starting at about 9–10 AM. I get home around 7–10 PM, just in time to kiss my favorite wife, give my teenage son a hug as he goes to bed, and then I'm on the computer catching up on the office work from the day and days past until usually around 5 AM seems to be the new norm. Up at about 8 AM—rinse and repeat my Groundhog Days. My loans & CCs are all maxed out constantly, and I just have no idea what happened to this dream drive I had to be the best in the industry and to truly make a change and grow this company to the vision I once had. UGH. I probably shouldn't even be coming to this event, but IDK, maybe there's something here that's going to allow for some transformation and growth to finally happen. AND GO000!!! I am all ears and moldable to learning and implementing any kind of positive criticism. MUCH appreciated! 👊Should You Let Your Employees Take Their Work Vehicles Home?
I'd love everyone's input on this and their why behind it! My coworkers usually use their own vehicles but I have a couple that use company vehicles. It started because my first real employee had his truck repo-ed and I needed him to stay working so I let him use my burner car. Then my mom blessed me with her old vehicle so I could let him use an actual work truck. Then I got another Van that I was using until another employee had an issue with his wife's car now he uses the Van so his family can use his truck for their personal stuff. He never uses it for personal stuff but it lives at home. Now the set up is we have a big Van that's used but always gets left at the shop. But the small van is being taken home by an employee. Seemed fine until it got broken in to and then of course I'm footing the bill to get it fixed. Especially when your vehicles are wrapped, you become a target. BUT the drawbacks are - when someone parks at the shop, that means as soon as they get to the shop every day, they have to clock in (california law). So every day, you are paying for up to an hour of lost time from them going to te shop to get their vehicle, then going to the job instead of going straight to the job site. Now my employees use their own tools so if the car gets broken in to, it's their stuff being stolen so the cost is damage to your property/ potential lost income if you have to decommission the vehicle for a few days. What is your opinion on this?What's a job you'd hand off if you knew it'd be done right every time?
Whether it's estimates, scheduling, field work, or customer calls, there's usually one task that's really hard to let go of. What’s yours? And if you've successfully handed something off, what finally gave you enough confidence to do it? In this Masters of Home Service episode, Austin Rogers (arogersavai​) and Sadi Ingallina (Grow Your Tree Co.) break down one of the toughest transitions for home service owners: stepping out of the field. They share lessons on hiring, training, creating SOPs, and building a business that doesn't depend on the owner being there every day. Never miss an episode of Masters of Home Service. Subscribe on Apple, Spotify, or wherever you get your podcasts.
Do employees fail because they’re bad, or because the owner never defined the standard?
This question gets uncomfortable fast. When an employee keeps making mistakes, it’s easy to label them as careless, lazy, or a bad fit. And sometimes they are. I’ve had employees or applicants where the issue was clearly attitude, lack of urgency, poor attention to detail, or an unwillingness to take feedback. You can train skill. It’s a lot harder to train someone to care. But I also think owners need to check themselves before they jump straight to blaming the employee. I’ve had moments in my own business where I was frustrated because someone didn’t do the job the way I expected. Then I had to ask myself a harder question: Did I actually teach that expectation clearly, or did I just assume they would pick it up? A lot of standards live in the owner’s head. The owner knows what a finished job should look like or which gate latch is weird. They know which customer is picky and where waste usually hides in a yard. That knowledge comes from repetition. A new employee doesn’t have that yet. If we throw someone into the field with loose instructions and expect owner-level judgment, we’re probably creating our own callback problem. Callbacks are expensive. They cost route time and frustrate customers. They make the owner lose confidence in the employee and the employee will feel like they’re constantly being corrected after the fact. That’s a bad way to train. For us, the better answer has been getting more specific before the mistake happens. What does the job flow look like? When should customer notes be checked? How should the yard be walked? What photos are required? What happens if the gate is locked? What happens if a dog is outside? What counts as complete? What should the technician do when something looks wrong? Those things can’t stay vague once you start hiring. They need to show up in training, ride-alongs, checklists, job forms, videos, quality checks, and repeated feedback. The bigger the business gets, the more dangerous it is for the standard to live only in the owner’s head. There does come a point where it becomes a people problem. If someone has been trained, shown the standard, corrected, given feedback, and still keeps making the same careless mistakes, then you may have the wrong person. But I think the order matters. Define the standard. Train to the standard. Inspect the standard. Correct against the standard. After that, if the person still refuses to meet it, you can make a cleaner decision. When an employee keeps missing the mark, how do you decide whether it’s a training issue, a standards issue, or the wrong person?
Is hiring freelancers for admin work worth it? What's your Take?
Has Anyone Used UpWork to Hire Affordable Freelancers for Admin Work/other jobs? I’m curious if anyone here has used UpWork to hire low‑cost freelancers for administrative tasks in their business. A few friends have recommended it for things like scheduling, data entry, inbox management, and other behind‑the‑scenes work — but I’ve never tried it myself. Before I dive in, I wanted to see what this group thinks. Have you used UpWork for admin help? Was it worth it? Any tips, red flags, or success stories? Appreciate any insight from those who’ve been down this road.
