PEMBROKE, Mass. — The question comes up every so often: Does it pay to offer commissions to staffers who do wash-dry-fold (WDF) work for your laundry?
Eligible workers are apt to forgo their last break, knowing it will mean the difference between a bonus and no bonus. Workers understand that if they get careless, the customer will complain and that will waste a lot of time. As a result, they make sure every garment is acceptable.
Workers are more apt to experiment with new techniques and procedures to boost their efficiency. In the laundry, workers are pleasant and helpful because they wouldn’t want to annoy accounts. Bonuses certainly keep workers focused on the tasks. Finally, workers appreciate that they can earn more than their base pay.
Everyone has a work pace. A person might normally process 100 garments per hour, but if he/she is highly motivated, the pace could increase to 110 garments per hour. Then there’ll be less work than time put in, and that will motivate the boss to bring in more work. The result is greater productivity.
How might this productivity increase come about?
The staffer might develop a faster way of folding T-shirts by flipping them over with one hand and then laying them down. He or she could better scan matched socks by spreading them out, toe first, on a wide table and then gathering pairs. The staffer might work in the early morning when he has access to larger machines and can process larger loads. He/she could employ a long table to bundle more efficiently. The staffers as a group might devise more efficient ways of switching shifts, improving continuity. There are many other variations of these improvements.
More efficient equipment would also help boost productivity. A new washer might have a shorter running time. A brand-new machine may also spin faster, cutting drying time by a matter of minutes. A new dryer might generate higher heat so that clothes can come out 10 minutes earlier. An extractor can get most of the moisture out of sheets, thereby reducing drying time.
All these efficiencies reduce processing time while increasing productivity and decreasing cost per unit of processing. If your WDF operation can double its profit, from 5% to 10% of volume, then it’s doubling its contribution, which will make a significant impact on profits.
Bonuses add to cost, which encourage operators to keep prices high. Evansville, Ind., store owner Steve Schmitt prices his WDF work at $1.31 a pound, and claims it’s the highest price around. At that price, he is able to provide a 20% bonus to staffers, but there is also sufficient revenue to cover costs ($1.01 per pound) to contribute to profit.
Might staffers get careless with bonuses?
The argument goes that because they get paid for output, they will simply focus on volume. But that strategy will not work over the long run because of customer complaints. One or two complaints and the staffer will realize that she can’t get away with shoddy work, and will continue to turn out acceptable work.
Would the staffer get the work done without the bonus? In other words, are the bonuses unnecessary?
Let’s assume, for argument’s sake, that you throw more work at the staffer. She may push harder on day one. But on day three or four, she will get tired of the exhausting grind, knowing she is not being compensated for the extra production. Most likely, the work will pile up.
Finally, you will feel good about writing larger paychecks, knowing your staffers earned their extra pay. The bonus system ensures that the more the staffer makes, the more the company makes. Plus, it’s a great selling point for new hires.
Bonuses motivate. WDF processing is the best vehicle to give the strategy a try.
Have a question or comment? E-mail our editor Bruce Beggs at [email protected].