Sharing profits is a powerful reward and retention tool. It allows employees to participate in the financial success of the company and work together toward that goal every day. Many restaurateurs find it is a good way to give employees more money without having to commit to salary increases.

* Most restaurateurs who share profits do so after employees have been on staff for one year or have worked 1,000 hours annually.

* Profit sharing is usually paid out annually, however some restaurateurs feel sharing profits more frequently is an excellent motivator and morale booster.

Spreading the Wealth – Peking Restaurant, Fairfax, VA

When the quarterly sales quota is exceeded at Peking Restaurant, every person on staff gets a share of profits, including part-time workers who receive a percentage based on the hours they worked. Owner Vincent Chu started the program because he wanted to give his people raises but couldn’t afford to. By allowing employees to share in whatever profits the restaurant makes-profits that they help earn-Vincent is able to reward them with added compensation. He posts weekly sales figures so the employees can keep tabs on their progress. Quarterly shares range from $400 to $800 per employee.

Impact: “This profit-sharing system encourages my staff to work as a team and, as a consequence, the operation really runs smoothly. Not only have sales increased, but our turnover has been cut in half,” says Vincent.