Obama 2012?

**deathgodusmc** · 01-30-12, 10:55 AM

Originally Posted by Bubbasam

Pretty basic stuff huh? So.....I have 60 employees X $15278 profit THAT each one generates for me, right? Hmmm....that means that I made a $916680 profit last year. FANTASTIC MAN. WOW !! That's an unbelievable 56.67% profit margin on the brow of my employees. It also isn't even close to the truth. And don't try and tell me that I'm part of the right wing movement. You don't know my political beliefs, and you certainly don't know me. You obviouisly don't know much about owing a business and you certainly don't know anything about my business....I ain't reading about it from some ridiculous chart Wicked, I'm living it. A lot of people here respect your opinion and stance on things, but when you throw a chart up that fits your argument but has no basis in reality (especially in my case, and EVERY other businessperson I know) it kinda hurts your credibility.

Some people think everything revolves around a political aspect. You get use to it. Good post as was the other and both are completely accurate. I wish i made the profit margin some think businesses make off of their employees.

**CivilWars** · 01-30-12, 11:02 AM

Originally Posted by WickedTribe

Sageworks | Profits Per Employee Increase

This is pretty basic stuff. Of course a company expects to make a profit on each employee - otherwise, there would be no incentives to grow. Contrary to what the right-wing propaganda machine may tell you, companies don't hire employees as a form of charity.

If it were that simple then the solution for every small business would be to just hire as many people as they can. What that chart tells me is that because employment numbers are down it is a buyers (business owners) market, so they only hire/keep the best, so they are doing more with less.

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**Thorsen** · 01-30-12, 11:16 AM

So. You own a business. Let's say you sell coffee. Let's say it costs you $0.30 of material to brew one cup of coffee (Inlcuding shipping/beans/cup/syrup etc). Let's then say you sell the coffee for $1.50 a cup. That's a way simplified version of basic profit making right? You mark it up above what it costs you to produce it in order to make a profit.

Now let's say you add an employee who can make coffee with you. Now you can make 100% more coffee in an hour than you could before, but you have to pay him. Again, REALLY simplifying this, but doesn't it go without saying that you would not pay this employee MORE than what he makes you from the increased profits? Or that if hiring him would see you losing money, that you would NOT hire him? Isn't that exactly why companies downsize in times of low profits; to increase efficiency?

Basically, if you only sell ~10 coffee cups an hour, and you yourself can make 20 an hour you will lose money on another employee. If you are selling ~35 coffee cups an hour, but you can only make 20, you're losing the profits from the other 15 you could have sold. So you hire somebody who can double your output and keep up with the increased demand. He gets a share of the extra profits (His wages) but so do you (Your salary/profits).

So as well as I understand it (And I'm by no means well versed in small business ownership) it's not that hiring a new employee will always automatically make you a profit. It's that no company would hire another employee UNLESS he or she is going to be instrumental in increasing profits.

Why would a business hire another employee at a loss? That's my honest question, because I am NOT a business owner. I would love to learn more about it though.

**deathgodusmc** · 01-30-12, 01:52 PM

Originally Posted by Thorsen

So. You own a business. Let's say you sell coffee. Let's say it costs you $0.30 of material to brew one cup of coffee (Inlcuding shipping/beans/cup/syrup etc). Let's then say you sell the coffee for $1.50 a cup. That's a way simplified version of basic profit making right? You mark it up above what it costs you to produce it in order to make a profit.

Now let's say you add an employee who can make coffee with you. Now you can make 100% more coffee in an hour than you could before, but you have to pay him. Again, REALLY simplifying this, but doesn't it go without saying that you would not pay this employee MORE than what he makes you from the increased profits? Or that if hiring him would see you losing money, that you would NOT hire him? Isn't that exactly why companies downsize in times of low profits; to increase efficiency?

Basically, if you only sell ~10 coffee cups an hour, and you yourself can make 20 an hour you will lose money on another employee. If you are selling ~35 coffee cups an hour, but you can only make 20, you're losing the profits from the other 15 you could have sold. So you hire somebody who can double your output and keep up with the increased demand. He gets a share of the extra profits (His wages) but so do you (Your salary/profits).

So as well as I understand it (And I'm by no means well versed in small business ownership) it's not that hiring a new employee will always automatically make you a profit. It's that no company would hire another employee UNLESS he or she is going to be instrumental in increasing profits.

Why would a business hire another employee at a loss? That's my honest question, because I am NOT a business owner. I would love to learn more about it though.

There are a couple reason to hire someone at a loss. Maybe your tired of working so the expense is so you dont have to or your anticipating and increase in business or you want someone to take over roles you no longer wish to perform. Every employee you hire is expected to be at a loss at first until you train them on what you want them to do. The hope is they fill the gap better then you expect.

I left out a good one. Your going to replace someone you currently have on staff.

**CivilWars** · 01-30-12, 01:56 PM

Or you can make more money doing something else. Using your example Thor if it cost you 10 cups per hour to break even on your employee's salary, but you are only selling 8, you might still hire them if it allowed you to bake coffee cakes that you could sell at a higher profit margin.

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**Morningfrost** · 01-30-12, 01:58 PM

Originally Posted by CivilWars

I worked in banking as well. So we want choice, but when we aren't responsible enough to make said choice, ie reading a contract, it is somebody else's fault? I get it now.

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Originally Posted by Warprosper

If you don't read the paperwork dealing with 100K+ purchase than you sir have issues and deserve the blame. It is your job as the buyer to understand the terms in which you sign. The banks, sure they were partly at fault, but I blame the greedy buyer for trying to live beyond their means.

It's more along the lines of their not being able to understand the mortgage paperwork. There were things about that paperwork that I didn't understand, and that's with my working in that field and being raised by two parents from the appraisal and mortgage field. The solution for most people would be to hire a lawyer to read through that paperwork and break it down for them, but that costs money and we're talking about people who are already living paycheck to paycheck. Instead, they chose to trust their bankers who told them "Everything will be ok, you only have to pay $x/month." Their trust was obviously misplaced.

**CivilWars** · 01-30-12, 02:01 PM

I can understand not understanding every word of every page of an inch thick book. However, if you don't read enough to understand that your payment of $X today could/will be $4X in 3 years, then you have nobody to blame but yourself. Yes, in an ideal world everyone would be ethical, but do YOU trust people that are trying to sell you something?

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**SmokenScion** · 01-30-12, 02:18 PM

only EA.

**Affinity** · 01-30-12, 03:02 PM

Oh boy, new member here so I only managed to read some of what you guys are getting into. A lot of it is economics, and though that is definitely an integral part of politics I think it's best to keep it simple...

Obama 2012? Probably. But, why?

Republican party in the past election really failed to rally behind a single candidate. We see the same thing happening this year. They're all over the place -- from a corporate-sponsored candidate like Romney, to your more reasonable Gingrich, and of course... the popular yet unsurprisingly isolated Ron Paul. The party is shooting itself in the foot. The Republican party had a chance to rejuvenate, and realign itself with real conservative values. I think this chance comes with the face of Ron Paul.

I identify with a lot of his issues, as do a lot of people, but I also differ on a lot of his ideology. I think this gives him more of a chance than any other Republican candidate against Obama. Obama did not deliver on nearly all of his promises, but for some reason the "left" in this country, just like the "right", is content with supporting a candidate that falls short -- just so they don't have the worse politician in office.

Picking the lesser of two evils. That's what American politics has become.

I bet Obama wins by a much smaller margin than 2008. I think the lack of unity in the Republican party is going to hurt it the most.