Showing posts with label hidden expenses. Show all posts
Showing posts with label hidden expenses. Show all posts

Monday, November 4, 2013

What's Your Excuse?

Employee Absenteeism

Employee absenteeism is one of those things that owners and mangers often sweep under the rug. They just
Bergstrom - Elder Consulting Group
Frustrated Owner
don't want to deal with it or spend the time to solve the root causes. Absenteeism can cost thousands in revenue and angry customers. It is an issue that should be attacked and the root causes eliminated.
Excuses can range from the believable to the what. Here are a few of the excuses recently posted by CareerBuilder.

·        Employee's false teeth flew out the window while driving down the highway

·        Employee's favorite football team lost on Sunday so needed Monday to recover

·        Employee was quitting smoking and was grouchy

·        Employee said that someone glued her doors and windows shut so she couldn't leave the house to come to work

·        Employee bit her tongue and couldn't talk

·        Employee claimed a swarm of bees surrounded his vehicle and he couldn't make it in

·        Employee said the chemical in turkey made him fall asleep and he missed his shift

·        Employee felt like he was so angry he was going to hurt someone if he came in

·        Employee received a threatening phone call from the electric company and needed to report it to the FBI

·        Employee needed to finish Christmas shopping

·        Employee's fake eye was falling out of its socket

·        Employee got lost and ended up in another state

·        Employee couldn't decide what to wear

If you liked those you might look at egroware’s list of 101 excuses for missing work. It is hilarious to read the excuses people give for missing work. At the same time it is a real problem for contractors who are trying to run lean and not be over staffed.

Combating Absenteeism

There are many legitimate reasons an employee needs to miss work. They could include illness, an accident, a family situation. These need the understanding and compassion of a business owner. It is the unexpected absences without a reasonable excuse that I’m discussing here. Let’s look at some thoughts that might help reduce absenteeism in your business.

1.      When hiring, check with previous employers about a job candidates attendance record and if the previous employee considered them a reliable employee. Would they hire the prospective employee again?

2.      Have a firm but fair policy in your employee handbook. Follow the handbook in all cases or you may be subject to legal issues.

3.      Eliminate sick days with pay. Change them along with vacation days to “personal days” which the employee can use as needed. Be sure to use them for each absence.

4.      Have a policy of no holiday pay if an employee misses the day before or day after a holiday without previous approval.

5.      Track absences and make it part of the employee’s evaluation when it comes time for increases.

6.      Have an annual award or incentive for perfect attendance.

7.      Require written approval (7 days or more in advance) for vacation or days off when it is a none emergency. Also the approval must be done by a manager or the owner.

Don't just sweep absenteeism under the rug. Put some controls into place and plug a hole of lost revenue and customers. 

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Dan has been in the service industry for nearly 50 years. He has operated a large plumbing, heating and air conditioning service company and for the past 12 years has helped small companies in the service business to grow and prosper. Contact him at

Saturday, May 1, 2010

No-See-Ums on your P&L?

No-see-ums are tiny insects that are a bother in the South including the Caribbean. They are so small that they can go right through screen. They bite like a mosquito with the bite welting up into an itchy red spot. You can get dozens of them without even knowing it until the itch comes hours later. Often their bite is more annoying that the mosquito’s bite.
The same thing is happening on many of my clients P&L statements. They were smart and developed a budget before the year began. They break it down into monthly budgets and even weekly budgets and monitor them against actual sales and expenses. They are getting bit by almost invisible expenses from a variety of sources thus reducing their profits. “What are you talking about Dan?” Let me explain.
Since all of my clients are on Menu Pricing, they quote a complete price to their customers. A water heater replacement is quoted including all expenses needed for a complete to code installation. This would include materials, labor, warranty, taxes, and permits. What they are finding is the fees for permits and licensing are increasing as a way for cities, counties, and states to increase income. The taxes for use and sales tax are increasing, and the suppliers are increasing fees for deliveries, returns, and warranty handling charges. Disposal fees of the trash from the job continue to increase. You have these tiny costs and cost increases biting into your profits. These costs were not planned on when they developed their budgets.
Additional “No-See-Ums” include federal, state and local business taxes, business annual inspections, increases in unemployment taxes, base rates add-ons to your utility bills, waste and water bills. Unfunded mandates from the federal government and state governments trickle down to the local level where you are taxes, assessed, fined or charged to cover the costs. Of course the banks continue to increased charges for credit card processing and other services.
Other “No-See-Ums” include additional fees for your vehicles including higher license plate costs, higher tire and oil disposal fees, higher tolls, stricter traffic enforcement (traffic tickets), and stricter D.O.T. enforcement (truck inspections).
I’m sure there are many others I have missed in putting this blog together. It is vitally important as a company to earn a profit to stay in business. Watching the little things on the P&L as well as the big things can help in achieving the profits you planned for when you developed your budget. Break down your expenses into reasonable categories so you can quickly monitor changes from the “No-See-Ums”.