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As the average age of an operator continues to increase, we will have a harder time trying to attract and retain quality operators.
After all this is a tough job and you want them to go all out for you. If you offer your drivers an employee benefits package, you will have an easier time holding on to your valuable staff longer. After all what is the most valuable asset in your business?
What do you spend roughly half of your budget on? Your staff! Think about the cost of doing nothing...if you do not offer benefits but XYZ Towing down the road does, where will all the good operators work?
Most employers pay for 50% of their employee benefits program and ask their employees to pay the other half.
But aren't employee benefits expensive? Margins in the industry are tight enough. Where do you find the money? Employee benefits are a part of the overall compensation package. A well-designed plan should cost the employer no more than 2% of payroll, if you share the cost with your staff. That's less than the average raise!
If this still sounds expensive consider the Two-Bits SolutionTM. Most companies pay their drivers commission of about one-third of revenue. Most companies have an overall revenue of $50 per call, and one-third of that is $16.50. If you reduce their commission by 1.5% that's a difference of about 25 cents per call.
If you take that 25 cents per call, it will pay your portion of the benefits. Benefit costs are tax deductible and carry no payroll taxes, such as; EI, WCB, Medicare, CPP etc., the way payroll costs do, making the solution more tax effective too. Ask yourself this...will your drivers leave you for two-bits? Or to have even more impact, reduce the commission you pay by 3%, or 50 cents a call. This would pay for the entire benefit package.
Are you willing to pay two bits to keep your drivers?
About the Author: Ralph has been in the Towing Industry for 14 years, including 8 years in Heavy Recovery and 5 years with an Auto Club. He has been involved in helping towing companies in many aspects of business operations. Ralph's insurance practice is now dedicated almost entirely to the Towing Industry.
Here's the deal...
Turnover has always been high in our industry.
Ten years ago, a driver left and there were 10 waiting to take his spot. Today, a driver leaves and there are 1 or 2 waiting to take his spot. In 10 years, we will have a hard time finding anyone to take his spot.
Why is this? There are two reasons...
1. There will be less young workers in 10 years than there have been for the last 20.
2. The workers there are will be older and married and demand we "take care" of them. They'll be going after white collar high-tech jobs like we told them to 10 years ago.
So what can we do about it? A few things...
1. Let's recognize that as we start to run out of drivers we'll have to reduce turnover and focus on retention.
2. As the governments download more and more services, employers will be expected to take more responsibility for healthcare.
3. Offering benefits as part of the compensation package will help you attract and retain better drivers.
The industry will see big changes in the next 5 years.
The question is: do you want to lead or do you want to follow?