Teach Your Employees To Respect The Chain Of Command. Proper Communication In A Business.

Many businesses seek to flatten their organization, spreading decision making amongst your managers. Teaching your employees to respect the chain of command is an important concept to support this task. Frankly even with a pyramidal organization, chain of command is highly important for effective management. It may sound rigid and Army-like but it plays a vital role in business and must be thoroughly understood in order for a business to function properly. Rank and chain of command are essential for ...

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What percent of your revenue should be allocated to payroll?

Deciding how much of your revenue to allocate to employee salaries is a critical consideration to make. Payroll is frequently one of the most significant expenditures for a business owner. Not only is payroll a regularly occurring expenditure, but it also comes with strings attached: taxes, insurance, and additional add-ons like vacation time, sick days and other benefits. For managers trying to hold on to already-slim margins, payroll is frequently the expense item that can make or break a business ...

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How to Design an Effective Commission Rate

Establishing commission rates for a specific employee or job title can be tricky territory to enter. Setting a commission rate should accomplish several things:

  • Create a profitable structure for the overall business
  • Enable the employee to earn fair wages
  • Incentivize exceptional performance by allowing the employee to potentially earn well above standard compensation by greater performance.

Instead of following the path of too many business owners, who insist that they can’t figure out a set commission rate and instead make up a “standard” number, ...

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Buying Out A 50-50 Partner, Fairly and Easily.

Most frequently, partners in a small business are very close friends, family, or long term trusted sweat equity business relationships. Perhaps one of the most difficult challenges confronting this relationship is how to break it up when the time is right. There are always many emotional issues which cannot easily be worked out, but the equalizer is found in how a buyout is accomplished and most important what the price and terms are. If done fairly, the relationship and the ...

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Horizontal or vertical expansion, which is best for you?

Profitable growth and development can be supported by various, distinct strategies. Two examples of these strategies are Vertical and Horizontal expansion. Although both are viable, each method depends entirely upon your goals and resources.

Vertical development consists of abiding by a natural chain of value added commerce. It works down a line of development where you begin with the natural flow of a product from its original source and terminate with the end user, using all appropriate channels in between. In ...

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Do not enter into a 50/50% partnership

On too many occasions, I have seen partnerships fail because of poor planning in the beginning. Two friends decide to make their dreams come true by starting a business together where everything including ownership and decision-making is split 50-50. One friend typically brings the money in and the other typically brings sweat equity, the work. It seems like the right thing to do, the partners think, mutually respectful, fair, but it eventually ends up in a disaster because of differences ...

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