andyinchville Posted October 25, 2011 Share Posted October 25, 2011 HI All, I've posted a similar question before and have been trying to crunch all the numbers and still cannot easily figure out the "proper" amount to pay help, so I thought I'd rephrase how I ask how much to actually pay out to route help. OK, so what is a fair amount (percentage wise of gross) to allocate towards paying help for running a typical snack route. The reason I am asking this again (although this time as a percentage of GROSS) is because my route driver wants more $$ (doesn't everybody?)....yet when I ran the numbers (including paying taxes to the man)...My route seems to be running in the red.... His solution?...Well let's just say he did say it was an all cash business! (on the flip side, I tried to explain to him that my income IS traceable if The man was really gunning for me (I get stuff from Sams Club on a Tax free basis (So I am sure there are records floating around somewhere in Sams Records )plus you have to use a membership card to buy stuff at Sams) and ultimately I'm sure that info is sent somewhere probably....most likely to the man himself!) , I pay via Charge card (so all the man has to do is research all my charges etc...)....Anyways I said my income is traceable to a degree....I have to report income despite it being supposedly "all cash" (admittedly, If I bought everything w/ cash from stores that don't require memberships to be used when paying for goods then maybe that would work BUT that is not what I've been doing). So, in closing, what is a fair percentage of gross to pay out to help on a snack route? Thanks in advance for any and all help. Andrew Link to comment Share on other sites More sharing options...
mission vending Posted October 25, 2011 Share Posted October 25, 2011 HI All, I've posted a similar question before and have been trying to crunch all the numbers and still cannot easily figure out the "proper" amount to pay help, so I thought I'd rephrase how I ask how much to actually pay out to route help. OK, so what is a fair amount (percentage wise of gross) to allocate towards paying help for running a typical snack route. The reason I am asking this again (although this time as a percentage of GROSS) is because my route driver wants more $$ (doesn't everybody?)....yet when I ran the numbers (including paying taxes to the man)...My route seems to be running in the red.... His solution?...Well let's just say he did say it was an all cash business! (on the flip side, I tried to explain to him that my income IS traceable if The man was really gunning for me (I get stuff from Sams Club on a Tax free basis (So I am sure there are records floating around somewhere in Sams Records )plus you have to use a membership card to buy stuff at Sams) and ultimately I'm sure that info is sent somewhere probably....most likely to the man himself!) , I pay via Charge card (so all the man has to do is research all my charges etc...)....Anyways I said my income is traceable to a degree....I have to report income despite it being supposedly "all cash" (admittedly, If I bought everything w/ cash from stores that don't require memberships to be used when paying for goods then maybe that would work BUT that is not what I've been doing). So, in closing, what is a fair percentage of gross to pay out to help on a snack route? Thanks in advance for any and all help. Andrew First, kudos to you for doing it right. FYI, you can get a printout from Sam's that will give you a summary of everything you have purchased, don't know how far back you can get the info (a couple of years at least) but it is available. The fair percentage question is hard to answer. I'm not sure there is a right or wrong answer but maybe this will help you. Let's say you have an employee that works 40 hours a week and your cost with employers taxes, unemployment etc is $15 per hour. That's $600 per week and $31,200 a year. Add another weeks salary expense to cover the replacement when he takes his vacation. So your annual cost $31,800. Info from NAMA several years ago was that the AVERAGE full time route driver would gross 250-300K. So doing the math at 250K its 12.7% of sales and at 300K its 10.6% of sales. From here on out its up to you. How good is the driver, how reliable, how honest? The answers will tell you how high or low to go. Is it worth going over the going rate for this kind of job to keep him around or do you take the chance that he will quit? Again, a very personal decision based on what your situation is that really can't be covered in a brief posting. Personally my attitude with my employees is here is the job, this is what it pays, if you are good you will get raises, if your ok you will get raises, just not as much. If you want to make a lot more then go get some more education to make yourself more valuable to me. One of my guys is doing just that and I am helping him by buying his books. I know when he graduates he will leave for something far better but in the meantime he is dependable, reliable and works his butt off when he is on the clock. Link to comment Share on other sites More sharing options...
andyinchville Posted October 25, 2011 Author Share Posted October 25, 2011 HI, Thanks for the reply and figures....My route is nowhere near 250K....Wow....Currently the driver makes $400 for 3 days work....His weekly gross is about $1850 give or take a little....I guess that figures out to about 21.6 percent which is why the route is a little in the red I believe. I realize my food prices are probably a little low (50 cent chips / 75 cent cakes candy) so I'll have to find ways to increase the bottom line and /or reduce expenses. I'll have to crunch last weeks numbers. Thanks! Andrew Link to comment Share on other sites More sharing options...
mission vending Posted October 27, 2011 Share Posted October 27, 2011 HI, Thanks for the reply and figures....My route is nowhere near 250K....Wow....Currently the driver makes $400 for 3 days work....His weekly gross is about $1850 give or take a little....I guess that figures out to about 21.6 percent which is why the route is a little in the red I believe. I realize my food prices are probably a little low (50 cent chips / 75 cent cakes candy) so I'll have to find ways to increase the bottom line and /or reduce expenses. I'll have to crunch last weeks numbers. Thanks! Andrew Asking for and implementing price increases is hard to do but is vital to the long term success of your business. Do you know what your overall cost of goods is? You should be in the 50-55% range. Sounds like you are also overpaying your guy based on revenue. There might be a good reason to pay him that based on what he brings to the table, but you need to ask yourself if his value warrants that kind of pay. If it does, then you need to find a way to be profitable with him or consider how you would run things without him. Link to comment Share on other sites More sharing options...
andyinchville Posted October 28, 2011 Author Share Posted October 28, 2011 HI, My helpers last week gross was a little higher.....$2060.54 I'm going to have to add up all food costs BUT I haven't run my part of the route yet (Thurs / Fri / Sat ) so I'll crunch cost figures for you after I figure in my sales and restock the truck to end of the week par levels. Figuring Profits / losses would be easier with 2 totally independent trucks / separate orders but we are not large enough for that yet....for now we'll have to share the everything and I try to apportion out food costs based on revenue VS costs to restock truck at the end of the week. As far as actual cost of food products go I pay 22 cents for chips , 14 cents for nabs, 49 cents for candies, and 45 cents for cakes. Andrew Link to comment Share on other sites More sharing options...
Poplady1 Posted October 28, 2011 Share Posted October 28, 2011 HI, My helpers last week gross was a little higher.....$2060.54 I'm going to have to add up all food costs BUT I haven't run my part of the route yet (Thurs / Fri / Sat ) so I'll crunch cost figures for you after I figure in my sales and restock the truck to end of the week par levels. Figuring Profits / losses would be easier with 2 totally independent trucks / separate orders but we are not large enough for that yet....for now we'll have to share the everything and I try to apportion out food costs based on revenue VS costs to restock truck at the end of the week. As far as actual cost of food products go I pay 22 cents for chips , 14 cents for nabs, 49 cents for candies, and 45 cents for cakes. Andrew I just want to jump in here for a few comments. You are getting good information already. If your route helper is also able to repair the equipment preventing service calls then you might want to pay more but if not then you need to get that percentage down. Hoping you have a good way of auditing your sales. If not, give some thought to it. If you decide to raise pricing be sure to tell your contacts first. In today's market they expect prices to go up so it won't be a shock to them. Just be sure you talk to each one personally. I would do it as a percentage increase across the board on all items. My two cents. Poplady Link to comment Share on other sites More sharing options...
WillisNYC Posted October 30, 2011 Share Posted October 30, 2011 HI All, I've posted a similar question before and have been trying to crunch all the numbers and still cannot easily figure out the "proper" amount to pay help, so I thought I'd rephrase how I ask how much to actually pay out to route help. OK, so what is a fair amount (percentage wise of gross) to allocate towards paying help for running a typical snack route. The reason I am asking this again (although this time as a percentage of GROSS) is because my route driver wants more $$ (doesn't everybody?)....yet when I ran the numbers (including paying taxes to the man)...My route seems to be running in the red.... His solution?...Well let's just say he did say it was an all cash business! (on the flip side, I tried to explain to him that my income IS traceable if The man was really gunning for me (I get stuff from Sams Club on a Tax free basis (So I am sure there are records floating around somewhere in Sams Records )plus you have to use a membership card to buy stuff at Sams) and ultimately I'm sure that info is sent somewhere probably....most likely to the man himself!) , I pay via Charge card (so all the man has to do is research all my charges etc...)....Anyways I said my income is traceable to a degree....I have to report income despite it being supposedly "all cash" (admittedly, If I bought everything w/ cash from stores that don't require memberships to be used when paying for goods then maybe that would work BUT that is not what I've been doing). So, in closing, what is a fair percentage of gross to pay out to help on a snack route? Thanks in advance for any and all help. Andrew In my area, the average seems to be 10% of gross collected. That number makes sense when you take into consideration all the other expenses that you have to cover. The 20% seems way too high unless there is some special reason you are paying 'full time' price for part time help! Tell your driver he can only get a raise when his salary is less than 10% of the gross he collects! My drivers 'salary' is tied to his gross, but I make sure that he starts with at least $300k of annual gross so that he has plenty of work and gets a reasonable starting salary! Link to comment Share on other sites More sharing options...
mission vending Posted October 30, 2011 Share Posted October 30, 2011 Hey Willis, Glad to see you stop in again. Sounds like things are going great for you. Link to comment Share on other sites More sharing options...
Vending How Chris Posted November 6, 2011 Share Posted November 6, 2011 Hey all, Just to give another viewpoint, I pull approximately 6,000/week in gross sales and I still get $10/h from my employer. After looking at the numbers, that is what makes sense. Could you perhaps sweeten the deal with your employee by consolidating their work days? I currently work full time but only 3 days a week, which is a great trade off for low pay. Also, because it's only 3 days I get lots of overtime which averages it out to more like $15/h. The whole raise concept is difficult with a fixed profit percentage. And it sounds to me like your product could be more expensive. We sell our chips and sodas at 85 cents but we are in California with good ol 9.25 sales tax. Y'all are right though - I give customers about 2 weeks notice before raising prices and when I do I remind them of our ever expanding selection - a.k.a the increased value they will receive by paying more. Link to comment Share on other sites More sharing options...
bill123 Posted May 4, 2012 Share Posted May 4, 2012 Hey all, Just to give another viewpoint, I pull approximately 6,000/week in gross sales and I still get $10/h from my employer. After looking at the numbers, that is what makes sense. Could you perhaps sweeten the deal with your employee by consolidating their work days? I currently work full time but only 3 days a week, which is a great trade off for low pay. Also, because it's only 3 days I get lots of overtime which averages it out to more like $15/h. The whole raise concept is difficult with a fixed profit percentage. And it sounds to me like your product could be more expensive. We sell our chips and sodas at 85 cents but we are in California with good ol 9.25 sales tax. Y'all are right though - I give customers about 2 weeks notice before raising prices and when I do I remind them of our ever expanding selection - a.k.a the increased value they will receive by paying more. Sorry to be responding to an older post. Chris, I am just beginning to toss around the idea on getting into vending in CA. Do I understand it correctly that vended product snacks & soda are taxes 9.25%. I assumed there was no tax like groceries and that the only thing I'd have to worry about is the CRV. Are there any other taxes? Link to comment Share on other sites More sharing options...
Walta Posted May 5, 2012 Share Posted May 5, 2012 The real problem is he feels under paid; the numbers are irrelevant the only thing that matters is his feelings. If he feels under paid one of 3 things will happen 1 He leaves your employment. 2 He pays himself from your cash boxes. 3 He develops a bad audited and piss off your locations. Walta Link to comment Share on other sites More sharing options...
Greatdane Posted May 9, 2012 Share Posted May 9, 2012 It could be bad news when an employee feels like he's not getting paid enough. Like Walta said, "he pays himself from your cash boxes" It is advisable to do random audits. For example, my vendors have a password protected menu where it shows all money put in machine, what products sold and how much of each from last reset.. I can reset it at any time. like doing a monthly check and audit. The route person has no idea that these numbers can be tracked. There is also a manual, no reset counter in the machine. he just rights down the daily mechanical counter number for auditing.They are coffee machines so cups sold x $1.00 - 5% mantenance/error/loss = what should have been collected. Nine machines minus/shrinkage of $2.00 each = $18.00 a day loss. That could be a nice retirement package. If the numbers don't add up, there is a case of shrinkage and you may have to investigate a little further. This may be a sneaky solution for about $30.00. Wolfcom's Black Button Body Worn Video Camera Recorder The "spy camera" can be made to look like part of the inside of the machine. As the employee does the audit and exchanges the machine individualized locked cash box, usually they will pocket the loose change that didn't "make it" into the cash box and if dishonest, will shrink a couple bucks into the pocket from the dba while the machine is open. Strange but my DBA is less secure than the locked secure coin box. If suspecting shrinkage, kindly inform employee to treat every location as if "the customer" has cameras everywhere and to treat every location as if they are under surveillance. You could even show them a Sony Alarm Clock B&W Wired Hidden Camera to show that they can't just "see" a camera but they could be anywhere. You would be amazed how fast the shrinkage shrinks. Link to comment Share on other sites More sharing options...
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