How do you take a $35,000 investment and turn it into nearly $800,000,000 in sales? You pay your employees. You pay them twice the national average and you keep paying them to be the best.
Container Store founder and CEO Kip Tindell explains that the secret to the company’s high wages is what he calls “the 1=3 rule,” meaning that one great employee will be as productive as three employees who are merely good.
As a result, Tindell feels he gets ahead by receiving three times the productivity of an average worker at only two times the cost.
“They win, you save money, the customers win, and all the employees win because they get to work with someone great.”
He also has a plan to keep those great people by continuing to pay them well through raises.
Tindell then keeps these “great people” by giving them annual raises up to 8% of their salaries, based on their performance.
Not one-time bonuses, but real raises. This investment in the employee by the company tells the employee their company really cares about them and wants them to stay and be happy there.
Many people don’t love their jobs, but they’ll work hard if they feel the company is investing in them as much as they invest in the company.
“Everybody loves to say that it’s not all about pay,” he explains. “But pay is more important than most people realize, particularly if you’re trying to attract and keep really great people.”
It’s all about the money. Every time I’ve changed jobs, even jobs I loved, it was for considerably more money.
Money opens doors. Money is the great enabler. It allows me to save for retirement, afford insurance, and contribute to my savings account.