Page 676 - Business Principles and Management

project:
MY BUSINESS , INC.

COMPENSATING AND PREPARING EMPLOYEES
Small businesses are usually at a disadvantage when developing pay and
benefit plans for employees. They usually cannot compete in terms of
wages or salaries and benefits. Small-business owners must be creative in
developing ways to attract and retain employees.

DATA COLLECTION
1. Use the Internet to find data on the average wages and benefits paid
to employees in service industries related to your business. Also deter-
mine whether your state and city have a higher or lower cost of living
than average.
2. Contact two small-business owners in your area and discuss the
types of benefits they offer to employees, why they decided to offer
or not offer benefits, and how they believe the wages and benefits
they offer affect their ability to attract and retain employees.
3. Search the Internet for recommendations on benefit plans for small
businesses. Sites such as the Small Business Administration and the
Department of Labor are excellent starting points for your research.
4. Talk with several of your classmates, friends, and family members
who work for small businesses. Discuss why they chose to work for
a small business, whether they believe their wages and benefits are
competitive with those of larger businesses, and how important ben-
efits are to them currently and in the future when deciding which
jobs to accept.
5. Use a telephone directory, business directory, local newspapers, and
the Internet to identify schools, colleges, government agencies, and
other public and private organizations that are sources of employee
training and training resources for small businesses in your area.

ANALYSIS
1. Identify the advantages and disadvantages of two pay plans you
would consider using for employees. Then select the plan you would
use and establish the wage or salary rate for full- and part-time
employees.
2. Identify the benefits you will provide for employees, including those
required by federal and state law and any additional benefits, if any,
you will provide. Attempt to calculate the cost of each benefit for
one employee.
3. Make a list of the types and number of employees you will employ
in the first six months of your business operations. Expand the list
to the types and numbers of employees you believe you will employ
by the end of the second year. Develop a budget of salary and bene-
fits costs for each time period.

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