Daily capital journal. (Salem, Oregon) 1903-1919, 1919-09-20

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What, In way, might he called sala-
rles, viz. approximately the amount
of money necessary TO meet their gen
; eral ll.ir. expenses leaving their sur
plus profits in the business. Any part
nership ar ans profit sharing plan that
divided M the profits and withdrew
them in cash ut the end of every year
| could not last very long
Why Some Profit Sharing Plans Fall
Many prafif sharing plans have divia-
! ed profits with employees on a casl,
basis and turned the money oyer to the
employees every so often, usually once
q year The result has been that il a
man earning $1,000 year received
5000 ut the end OF The year from
proft-sharing plan, he promptly lifted
his living expenses from a ST 800 basis
| to a $1,000 basis, and began to look
| upon his income as $1,000 rather than
! s., 900, and The extra 5000 did little to
| increase his activity and efficiency. or
TO promote his intellectual efforts In
| the business concerned
1HNh II pCiiVo NNhC pd@i-
ness was dull or poor and he did not
get the extra $500, he found fault with
| the owners Of the business and became
grouchy and inclined to lose interest
In his work.
Little real substantial benefit comes
from a protit-sharing plan where the
profits are paid out in cash. except
perhaps where man uses the money
toward buying a home
Full Publicity Needed About the Busi-
In establishing prOtit-sharing it Is
Of the utmost importance that the
entire organization, the wage and sal
sry earners, know in advance exactly
what they are expected to accomplish
! mean by this that, on entering new
year, they should know exactly what
the preceding years accomplishments
have been. The annual statement OF
the concern should be full and explicit,
so that every man engaged in the enter
prise will know what business was
done in the preceding year and on what
basis profits were and are to be dis
tributed.
Some Objections to the Plan Answered.
Many people have said to me: "Oh,
but 1t takes long while for a man
who Is only saving a small sum each
year to acquire much Of Il financial in
terest in the concern by which he is
employed" | have always found that
such criticism comes from someone
who has not given sufficient thought to
the subject, for a small interest means
as much to the man having COM
paratively small salary as large in
terest does to the man of large affairs.
Let us summarize some of the adj
vantages Of this method of profit jhar-
ing:
First-It is real, 1t is genuine. The
organization as a whole, and each in
dividual in it, has definite goal for
the years work. They know at the
beginning a year how much money
must be earned to cover what we will
and fixed charges; they know that
they are being pair salaries to earn
those fixed charges; they know that
they share in all the profits over and
above those fixed charges, and they
know the basis on which they share,
and that the amount of such profits
largely depends on the individual and
collective effort Of each individual in
the organization. This in itself is of
great practical value to the business
from dollar-and-cent standpoint.
Second-Having reached the goal
set, the money over and above the sal
aries they are paid-in other words
their profts--are invested In the busi-
ness in which they are engaged and
on which their whole time and thought
and energy should be centered.
Profit sharing on the basis favor !
is sometimes objected TO by men or
concerns who do not wish to let even |
their own employees know how little |
or how much money they are making |
each year If they are not making |
enough money and the business Is run |
ming on close margin each year, |
then by all means they should set |
their situation before their men, !
adopt such profit-sharing plan as
have outlined, and get the genuine CO. !
operation Of every man towards IN /
creasing the profits and putting the
business In prosperous condition.
The man who is running on small
margin and making little profit may
object to making his business affairs
public property, on the ground that he
would be putting weapon in the hands /
of his competitors, Such mans best /
protection against his competitors Is
loyal, closely knit organization of the
highest efficiency, and this important
advantage he can only secure through
n hona fide protit-sharing plan.
AS for the man who is making SO
much money that he is afraid TO let even
his own employees know how much
he Is making, to that man | say that
he is man who, more than any other,
is responsible for the serious differ
enccs today existing between capital
and labor, for with the growing intel
ligence of the masses, how can he ex-
peet such situation to continue?
AS for the man who Is making large
profits but who objec& to profit sharing
ON the ground that he wants to put
those profits away against the day !
when business may be poor, TO such a