Remodeler Greg Friebel created a bonus program that takes into account the number of times a lead carpenter leaves the job to purchase needed materials. “We wanted to accomplish a few things: First, to give guys some cash bonuses in a viable way that worked for them and for the company; second, to maintain a 50% margin on all our jobs,” Friebel says.
Friebel & Friebel Fine Building and Remodeling, in Shelby, Ohio, is a DreamMaker franchise. Although the bonus program is not part of DreamMaker's policy, Friebel asked the company to approve it for use at his franchise.
The program is based on the size of the job. For jobs of $10,000 or more, the lead carpenter must maintain a 50% margin and is permitted to leave the job up to six times to pick up supplies or materials. Leads who accomplish that receive a $100 bonus. If the margin drops to 45%, they receive a $50 bonus, and at a 40% margin, the bonus is $25. However, if they leave the job once more than the allotted six times, they receive no bonus at all. “I explain to them that they used that money for the extra trips instead of getting the cash in hand,” Friebel says.
The same bonus plan is in place for smaller $5,000 to $10,000 jobs, but just three trips are permitted. Friebel says some errands are necessary for design/build work where there are more unknowns. He notes that each trip takes a minimum of one hour. Before implementing the program, he kept track of such trips during a two-month period and showed the results to the staff.
Since the bonus program began more than a year ago, Friebel says that the number of trips has greatly decreased, there is more communication among the staff, and the production manager spends more time clarifying details with the sales department. “It has brought production and sales closer together so we have a more rounded view,” Friebel says, adding, “We pass out the bonuses in front of the entire staff, to encourage them.” To date, he has paid 12 of the $100 bonuses, six $50 bonuses, and three $25 bonuses.
At different points during a project, the lead carpenter might be working with another carpenter. Whether they choose to share the bonus with that person, and how they do it, is up to the individual. Some opt for splitting the money, while others may go out together for a meal.
