Advisory transcript (Mike Andes advising Marcus) on structuring pay and revenue to enable the owner to exit. Key recommendations: move employees from sales-driven pay to salary (~$80k) plus profit-sharing (~15%) once they become GMs; use hourly pay plus owner distributions during an operations phase; concentrate on converting revenue to recurring streams and limiting new-project intake to simplify sales handoff. Location figures discussed: one site ~ $600–700k, the other ~ $800–900k annual revenue. Current base hourly rates: Mount Vernon $22/hr, Redmond $23/hr; advisor recommends raising effective pay toward about $32/hr based on P2P/P4P top-performer averages.
Questions this video answers
At least $80,000 per year.
Approximately 15% profit sharing.
Hourly pay plus owner distributions.
Mount Vernon: $22/hr base; Redmond: $23/hr base.
About $32 per hour.
Chapters
Do estimates and you're able to take sales off my plate 100% for an entire quarter. Then you'll switch to salary, which is going to be 80 grand at least, and you're going to make, say, let's call it 15% profit sharing. So I would just. I would just. Assuming your goal is that you move out, I would just make their incentives align with you getting out of the business. So then what will happen, Marcus, is they'll want to learn sales. They'll want to make sure they know all of that and get you out as soon as possible. And you won't be like, forcing them or pushing them to do something they're not. They're not comfortable with, but. But better.
Yeah, that makes a lot of sense.
Because in growth mode, you're going to be the best, like, you're going to be the best salesperson by far. So the objective is get as much of the revenue recurring by the time you do hand it off to them so that very few of their estimates have to be done in person and very few projects are being done, making the sales part way easier for them to get handled. And so I think for both of your locations, given that one I think is like 6 or 700,000, the other one's at like 8 or 900,000 in annual revenue, I would be really looking at like this coming year, like, being in profit mode heavily trying to get as much recurring revenue as possible, even if your revenue stalls out. But you just like, basically don't take on projects that are not from existing customers. Like, just keep hitting your capacity and just get more and more, less and less tolerant with what kind of projects you're taking on because that's going to be allowing them to take on sales sooner.
Okay, yeah, that makes a lot of sense.
So I think, I think my comp plan would probably look like hourly plus owner distributions, as long as they are kind of doing an operational role only and say, hey, you're basically an operations manager. When you move to a GM and take over all of this off my plate, then you'll move to salary and you'll also get a higher profit sharing percentage. And then you just be like, hey, I know that as me doing the sales, it kind of handicaps you somewhat from actually governing the profitability of the business. And so I understand that the goal is to. That eventually that's not the case and we're able to actually, you know, you can take more control and autonomy for the whole location.
Okay. In Mount Vernon, we pay $22 per hour base. And then in Redmond, we pay $23 per hour base. What should their hourly pay look like, do you think? Because some of our top performers on P2P for both locations make about $30 per hour and y. And if it's anything less than that, then they might seem like, I don't know, it's tough to look out in the future for, like, the next traffic quarter for. For distributions, especially in spring and early summer where we don't really get a lot of profit sharing.
Yeah, I would. I would. Since you're going on hourly with them, I would just make it very much worth their time. So if they're like, average on P4P is 28, 29, 30 bucks. Do 32.
