The US Postal Service should have profit sharing; it continues to lose billions of dollars a year. The Postmaster General should say to everyone, “Look, we’re not making a profit. We’re losing serious amounts of money. Help us make a profit, and a good percentage of that will go to you as bonuses.” The post office would be profitable within a year, I’ll bet.
It doesn’t matter whether your company is a small mom-and-pop business with a little bit of part-time help or a larger organization with several employees or a mega-operation like the Postal Service: The best way to create a profitable company is to give everyone a piece of that profit. Everyone involved — even the part-time help.
That immediately turns employees into owners. They start thinking like owners and acting like owners, and seeing where they can contribute to the bottom line. (And every employee can affect that bottom line in some way, either by cutting expenses or increasing income — or both.) If you have a tiny operation, say to everyone, “Look, we’re not making any profits at all. Help me get this company sailing along and profitable, and I’ll split half the profits with employees.” Split it 50-50, and watch the results. If you’re in a mega-corporation and feel that 50 percent is way too much, start by giving 10 or 20 percent to employees, and watch your profits grow dramatically!
It’s so obvious — I really don’t know why more companies haven’t realized this yet. The bottom-line people, the numbers people, should recognize this: profit sharing is not a matter of being generous to employees; it’s a matter of maximizing profits, which businesses love to do.
Support your people with part of your profits, and you’ll have a far greater profit. The formula is a simple one: give half of your profits to the employees, and you’ll see far more than twice the overall profits, so in the long run you’ll make far more than you would have if you’d gotten 100 percent of the profits.
This seems so obvious to me — and has so obviously worked not only in my experience but for so many other companies as well. Why aren’t more companies sharing their profits with their employees? It turns a struggling company into a profitable one, and turns a profitable company into a far more profitable one. It’s win-win business. It’s enlightened capitalism.
I encourage every one of you to do what you can to start profit sharing now. And prepare yourself for some great results!
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