|
Phil Holland Founder, My Own Business How can I best create incentives for my store managers? |
|
| Two requirements we think are important in expanding by adding stores, one is that you will need to create an incentive plan where your managers are paid incentive compensation based on the earnings of the stores not the sales, the earnings. The plan should provide the profit and loss statements are pulled off very frequently. In some cases retail food operations prepare weekly financial statements which means that the managers which means that the managers bonus is actually paid weekly basis. More often it is done on a monthly basis but the frequently is important because you need to know at close intervals if there are any problems so they can be solved before they get to be bigger less manageable. Your manager's incentive is much much more stronger if the carrot is at a much closer distance than in the future. Also your managers are not interested in sharing in the profits of the overall company. Much more important to them would be to share in what they individually accomplish. So this means compartmentalizing your financial statements so that each store becomes a profit center with its own financial statement, its own income statements and its own reward for the manager. | |