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?
One laundry operator replies, “No, I don’t think it’s necessary. My staff is already adequately paid.”
Another operator says, “The workload generates the effort. As long as they have work in front of them, they’ll push through. You don’t have to pay them extra.”
Steve Schmitt disagrees. He owns five Laundromats in the Evansville, Ind., area, variously named Don’s and Claytons. He offers 20% commission to his staff.
“Last year, we did 180,000 pounds of WDF volume,” Schmitt says. “I charge $1.31 a pound and the staff gets 20%, so that nets me $1.04 a pound. I gave out $36,000 in bonuses. The staff really takes care of the customer and that benefits my company.”
Do Schmitt’s comments change your mind? Giving a bonus is certainly a motivating factor. 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.
There’s no question that bonuses motivate staffers. There is a direct correlation between performance and pay: the more work done, the higher the take-home. This is a time-honored tradition of rewarding workers for putting out more effort, for showing up every day and for doing the work satisfactorily.
Consider a worker who comes in Monday through Friday to do six hours of WDF. It’s tedious, repetitive, and a drudgery.
Every order must be kept separate. One must concentrate all the time, and is constantly handling garments. Matching pieces is often difficult. If one’s concentration wanders, one may begin to fold sloppily. If one takes shortcuts, he/she will annoy the customer. If one is not careful, he may miss stains, while the customer may expect the WDF staff to notify him of defects.
On the other hand, if time doesn’t matter, one might be overly finicky, and deliver perfectly folded garments, when maybe the garments don’t need that level of treatment.
Another benefit of providing bonuses is the staffer develops better, faster rhythms of work.
Everyone has a work pace. The person might process 100 garments per hour, for instance. But if he\she is highly motivated, the worker’s pace could increase to 110 garments per hour. Then there’ll be less work than time put in. That will motivate the boss to bring in more work. The result is greater productivity.
In fact, productivity is the key to profit. If you do 80 garments an hour at a cost of $30 per/hour (labor plus utilities), that’s a cost of 38 cents per unit. Increase productivity to 100 units per hour, and your costs are reduced to 30 cents. A reduction in cost of eight cents per garment adds a lot of profit to the bottom line. It translates to a 26% increase in profit. That’s major.
Check back Thursday for the conclusion!
Have a question or comment? E-mail our editor Bruce Beggs at [email protected].