I am wondering what you guys would think that a good bonus structure would be for a GM of a processing facility. The GM is also a partner with a good salary, however the bonus structure we want to create should pay very well based on performance. I’ve seen some structures where they are paid based on their thorough-put of processed weight and then I’ve also seen structures where it was based on the amount of processed goods sold. I’m wondering if any of you guys have any good ideas for a good bonus structure for processing facilities. What would be a dream bonus structure?
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It has to hinge on revenue, thru put doesn’t work.
Just my 2 cents.
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Agreed. I turned down a performance bonus to help buy more and better equipment. It was solely based on ideas that turned product into money.
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$ per gram made is always nice
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My dream bonus would be the total net income after taxes. Maybe you could offer him a percentage of that.
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Until you have a huge backlog of mids that don’t sell
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That’s the sales team’s problem, not the processors. If the person is also in charge of the sales team, then that makes sense, but if they are only responsible for processing, it doesn’t make sense to leave their bonus dependent on people outside of their control. Bonuses should be tied to the individuals’ performance within their scope of practice. Just my two cents.
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Yeah, presently on the other end of that. Selling out. Thankfully growing into our shoes.
I think there’s a mis-alignment of incentives. Shovelling trash onto a sales team to get more of a production bonus won’t result in a healthy balance. If anything, it should depend on performance of both, ie: unsellable product is deducted from processor side, inability to sell fast enough nets commission reduction
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Salaries and T&E are expenses.
Chad gets an airplane before you get a bonus.
What should really be done is the formation of a fund, so those of you who have made it can loan money for experienced people to level up with equipment leases, etc.
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Only if you follow GAAP! Lol. You’re probably right. Luckily we have someone else doing our accounting. Lol
Only if quality standards aren’t already a part of the business. I agree that people shouldn’t be incentivised to push out as much poop soup as possible. That sounds like a terrible business plan. However, if there are standards in place for what the lab produces, production incentives should be a no brainer.
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