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Home » Business And Finance Articles » The Massive Benefits Of Profit Sharing

The Massive Benefits of Profit Sharing

Do you run your own business and want it to grow by leaps and bounds? Do you have employees that are hard workers, but could work even harder? If you can provide the right incentives then you can prompt your employees work to their highest potential. Highly productive employees can be the ticket to a lucrative and successful business.

How can you encourage employees to take on a more active role in your organization? One method is to engage in Profit Sharing. Profit sharing means that you can offer employees a piece of the profit pie. Employees are typically paid on a salary basis. You may feel that simply offering a highly competitive salary is enough to encourage your employees to work harder. However, this is often not the case because employees will be paid the same amount despite differences in their productivity.

Profit sharing, on the other hand, enables employees to feel a part of the team. They will have a vested in the success of the business because it personally affects their bottom line. The power of a profit sharing incentive is immense. Employees will feel as though they are part of a team instead of simply an employee.

How can you start a profit sharing incentive at your business? There are many ways you can implement a profit sharing incentive program from stock options to sales commissions. One way to begin is to be honest and open about your company's financials with your employees. Depending on your comfort level, you can allow them to view the financial numbers that keep your business afloat. Enable employees to see exactly how much revenues and profits your business is earning. Be sure to also show them how much overhead is currently costing your company.

Showing the profit side of the books will encourage employees to strive harder to make more money. They need to understand that the more money the company makes, the more money each employee will have in their pocket.

Showing the overhead cost side of the books will prompt employees to seek ways to minimize overhead costs. For example, they may try to conserve paper and electricity once they see the costs associated with these overhead items.

Profit sharing is a powerful incentive option that will change employees into team members. Your company profits will soar since employees now have a vested interest in the success of your company. So if you're searching for an incentive program for your business then profit sharing may be just the right plan for you.

And here is another random article you might be interested in...

Creativity Is King In Business

In my last article, "The Reality of Buying Wholesale," we looked at some of the controls that the largest companies in the consumer goods market place on their distribution channels. As we learned, some of these companies make it impossible for the small, start-up online retailer to obtain their merchandise.

However, this is no reason to give up on your dream of being a retailer. Less capital to invest just requires a little more creativity. Many established retailers have built their businesses by starting out small and then adding more products as they grew. In this article, we'll look at some creative options available for those who don't meet the requirements to be an authorized retailer with some of the most popular brand names.

Where do businesses find merchandise?

I'm sure some of you are thinking right now about the many eBay sellers or independent online retailers who sell popular brand names. If they are products that are only sold direct to authorized retailers, or through wholesalers bound by strict manufacturer's requirements, then these sellers are obtaining their products in one of three ways:

1. They are an authorized retailer who met the manufacturer's requirements

2. They are selling used merchandise

3. They purchased their merchandise through liquidation or closeout

Sell Used Goods

If you're looking to make money selling on eBay, selling used merchandise is a very viable idea. Many sellers, including several of my personal friends, have built successful eBay businesses selling used clothing, electronics, musical instruments, and toys, just to name a few. They locate their merchandise through estate sales, garage sales, classified ads, thrift stores, consignment shops, and sometimes even through eBay itself. Then they clean up the merchandise if need be, and list it for sale in an attractive and exciting way. I know several people who substantially subsidize their existing incomes by doing this, and I even know a couple who do nothing but sell on eBay.

Closeouts and Liquidations

Closeouts and liquidations are also a very viable source of merchandise for both eBay and an online retail store. With a good closeout or liquidation source, you purchase reasonable lots of overstocked or discontinued merchandise. You'll be purchasing last year's models, but there is a large market out there for this merchandise. Most people don't have to have the latest style or model, especially when there is a large savings involved by purchasing last year's products. Many sources of liquidations and closeouts are available by searching online and calling around to do your research.

Consider Lesser Known Brands

Another option is to look at other brands that may not be among the most popular. Not every consumer has to have the most popular, most expensive brand. In fact, most people don't buy the top brands all of the time, making this market very large. This is an excellent option for someone who wants to establish a retail store selling brand new, recent model merchandise. Once you establish yourself as a respected retailer in this market, your reputation will make applying to resell other products that much easier.

Keep an Open Mind

When you're deciding on a business venture, it's very important that you don't go in with blinders on. Be willing to consider multiple types of products before deciding on the items that you want to sell. For instance, clothing, consumer electronics, and DVDs are very popular items, and not just among consumers but also among sellers. If you choose a very popular market, the requirements for resale may not only be more difficult, but it may also be more difficult to compete with the mass of sellers in the market.

Creativity is King

Creativity is king in the business world. To be successful, you must locate a niche where you can provide a benefit that makes your business stand out. When I talk of creativity, I don't necessarily mean originality, either. There is a difference. It's difficult to be original in the business world, as so much has been done already. Originality doesn't always win either. If you're too above and beyond the norm, people may not relate to your approach, and thus turn away.

Creativity could be as simple as borrowing an idea from another market and applying it to a market where it hasn't been used. People had long delivered flowers, and people had long delivered groceries, but no one had ever delivered pizzas until Domino's started doing it. Now everyone down to the smallest corner pizza joint delivers pizza because it works.

That's an example on a grand scale of where a simple idea grew into a giant success. Not all of us will be as fortunate as Domino's, but millions of business owners have succeeded using the same principles. They located a niche where they could provide a benefit that made them stand out, if even ever so slightly from their competitors. This advantage gave them market share, and now they live comfortably from the proceeds of their creativity.

Put Forth the Time and You Will Reap the Benefits

Creating a business requires a great deal of time and research. You'll need to research products and find some that are attainable at a price that will make you a profit. Then, you'll need to research the market and determine an approach that will set you apart. At the same time, remember to keep an open mind and consider several markets, ideas, and approaches before you decide on the best fit. You have a lot of work ahead of you, but no one ever said that good things come easy. And I can tell you that when you do your research and do it right, the benefits are more than worth the effort.

In my next article, I'll be discussing the reasons the Internet has made business ownership much more attainable within the last five years. Until then, put on your thinking hats and find yourself an idea worth that's worth the effort. And, as always, good luck in all of your business ventures!