Want to increase your company’s profits? Give some of 'em away.
That’s the experience of Vancouver entrepreneur Brian Scudamore, founder of 1-800-GOT-JUNK?, North America's largest junk-removal service with more than 150 franchise locations.
As related in his column in the latest issue of PROFIT Magazine, Scudamore decided two years ago to create a company-wide profit-sharing program. He committed 25% of his company’s profits to the pool – and it’s worked beyond his wildest expectations.
“Like most business owners,” he writes , “I thought that profit-sharing would increase the company's overall profits, but not enough to cover the profit-sharing payout; thus, 1-800-GOT-JUNK? would recoup less of its net earnings. Was I ever wrong! In fiscal 2004, the program's first year, our bottom line after profit-sharing payouts increased by almost 800%. This year, our annual profit is trending 50% higher than it was in 2004. To me, that's a clear sign the program is working.”
An example of the benefits: “People started watching everything from the macro, including company-wide revenue and profit, to the micro, such as the entertainment or telephone expenses of individual departments.
“One employee took the initiative to replace our expensive bottled-water service with a filtered-water system, cutting our drinking-water costs by a third and inspiring the rest of the team to find wins of their own.”
Read the whole column HERE.
'Tis the season.