What do you think? E-mail us your feedback, contact information and the subject line, 'Pro to Pro' with your message.
Have a question and looking for feedback from industry peers? This month KBDN listens in on dialogue between industry professionals as excerpted from the KitchenBathPros.com online Designer Discussion Forum.
I know this has been discussed before at this forum, but I was recently offered a design position that pays 100% commission. The rate is 1/3 of the gross profit, which sounds great, but I’m still on the fence about whether or not to accept it. I need to support my family, and what happens if there is a sudden drought?
I also need to ask, for those out there who work on 100% commission, do you have any kind of health insurance or 401(K)? What type of benefits does your company offer to its employees?
Right now I get 401(K), travel expenses, health insurance, life insurance, an hourly pay, bonuses (sometimes), free education and heavy discounts. But I know I can make more income with commission, and with a family of four, income is the most important thing for me right now.
Any advice that anyone can offer in this regard would be very much appreciated.
Here’s my personal opinion, based on some experience I've had with both methods of compensation. I would never again accept a commission strictly based on gross profits. You have no idea how that number is going to be calculated, and I don't think that you really want to get into an argument with the owners about that issue.
Most designers are not managing the entire transaction unless they own the shop, and most jobs include installation as part of the product. If you don’t have complete control over the gross profit on a job, why would you accept a commission based on gross profit?
Make sure you are paid on what you can control. I remember from many years ago that I had a professor who made a comment in one of my classes. I’ve never forgotten what he said: “Never play anyone else’s game.” The times in my life that I’ve regretted doing something have almost always been attributed to forgetting that sage advice.
Where do you work now? Some of us may be interested in your job!
But seriously, does your company offer various benefits, including educational reimbursement, insurance, bonuses, etc.? If that is the case, you definitely want to consider that as part of the equation.
I have been on both sides of the issue. At one firm I was at 25% of the gross profit, and that was selling cabinets only. That was fine with me because I was in control of setting the job costs and sell price.
Another firm I worked for that sold construction wanted me to take a hit in the commission if the contractor screwed things up. I never could get a straight answer on this stuff, nor was I ever able to see the job costs. I didn’t care for the smoke and mirrors approach that seemed to be going on.
With this job opportunity, I would insist on being in control of all profits. But health insurance is extremely important, especially with a family to support. If they offer that, then it’s a “no brainer” decision. I guess that I have a lot to think about with this issue.
This gross profit thing can be a hidden problem.
One company I worked for in the past paid commission on gross profits. If there were any mistakes, then that pay, of course, came out of the gross profits. There were actually many times that the designers ended up owing money back on the jobs! Of course with this company, installations were part of the deal. If anything went wrong with the installation – and you can’t believe some of the insane things that happened – this went against the profit of the job, and directly affected the designer’s commission.
This is indeed a very tough decision to make. It could be a good opportunity, or it could easily work out to be not as good of an opportunity as it sounds. I’m sure you probably wish that you had a crystal ball!
There are numerous risk factors here for you to consider. First, you have to look at the flow of business. Yes, it can absolutely stall, fall flat and outright stop for a time, all that. That’s certainly happened to me before. What I’ve done is go out there and drum up more business, which helped in only a very limited way at first, though I was able to make contacts that may help much later on.
Yet, I do believe in the power of positive thinking, too, and there is not just one way to market yourself, there are many – especially if you do it correctly. If the business doesn’t come, you may have to incur expenses (like realtors do) to get new business, so don’t forget that aspect of it, either.
Out of curiosity, how are the leads with this other company? How busy are they? Those are key questions to ask. In fact, if I were you, I’d ask as many questions as I possibly could.
In my case, my husband has the benefits, so that’s not really an issue for me at all.
Think of how many kitchens you’d have to do in a month to get the money you want, and then see if the company supports that level of leads for you. That’s a good place to start the decision-making process, in my opinion.
I think that these are all very good points. If I could do anything differently (or rewind time) before I made the move and found out how their promises fell short, I would have checked them out more thoroughly [before accepting a position offering 100% commission].
Check with vendors and find out what their volume is, and chat with current employees. Get a feel for it before you make the leap. Finally, check their rating with the Better Business Bureau to get an idea about how they do business.
I think that you are confusing gross profit with net profit. Gross profit is what it is, there is no magic to calculating gross profit. Net profit is a different animal, and typically only the owner or accountant knows what the new profit is.
Gross Profit = Sale - Cost of Goods Sold
Net Profit = Sale - (Cost of Goods Sold + Selling, General & Administrative Expenses)
By no means am I an accountant, but commissions based on gross profits are the most fair arrangements to all parties, in my opinion. When I make a mistake (mismeasure, etc.) it affects the gross profit and we typically share the cost 50/50 at my company.
I’m currently employed under this system and it has allowed me to earn quite a handsome living. To weather the ups and downs, I receive a monthly draw check based on a percentage of my prior year’s commissions.
By the way, we get 401(k), health benefits, generous vacation, personal and sick time, a nice office, displays, current samples, etc. In short, we receive all of the tools we need to effectively sell.
My cell phone, laptop and digital camera are supplied by myself with no reimbursement, however.
As I said, it couldn’t be more fair for all involved. Good luck!
If you don’t mind me asking and are willing to share, what is your commission rate and what are your typical annual sales numbers based on your current position?
Our program revolves around a gross profit of 40% and a commission rate of 10%. We are in total control of sales and what final numbers are. I have to say that it works really well for me.
ENAMEL FINISH & APRON SINK
We recently finished a job for a client using a white enamel finish with a Shaw’s farm sink. We have replaced the doors once due to bubbling paint. Now the client is complaining about more bubbling paint on the new doors and face frame. This sounds like a water issue to me.
On top of this, the installer did not install the sink correctly (not my installer), and it became necessary to add trim around the sink to cover the improper scribing that occurred. This trim is also not wearing well and needs replacement. Has anyone had issues with this particular combination? Or issues in general with enamel finish and wear and tear around the sink area? Does anyone have any suggestions for me?
I did have an issue with water damage and paint on a kitchen that was only some months old. I think it was an undermount sink, if I remember correctly, but still, there was damage to the paint. The company sent their touch-up person to the job and he did the repair, but he explained to the clients that it was carelessness on their part due to water, and they would only repair it that once.
I think the clients believed it was a defect in the finish, but it hasn’t happened anywhere else in the kitchen. This customer denied carelessness, but they do have teens in the house, too, and they themselves may have been careless. Someone certainly was, in my opinion. This has been my first and only issue ever like this, so someone was definitely not being careful. I think it’s probably a good disclaimer to put in a contract.
I have not personally had this issue happen, however, I have seen it happen to a designer friend of mine. We felt at the time that it was an abuse issue on the part of the client. This was not with an apron sink, but an undermount, and it was very apparent that water had been continually running down the face of the sink base and never wiped off.
Is it possible that the water is going between the sink and the countertop and wicking down the side of the sink, out to the front and down the front of the sink base? One would assume it would be caulked there, but you can never completely assume this to be the case in these circumstances.
Can you look at the cabinet deck the sink sits on? I would be curious to see if there were any other water or moisture issues there as well. If there are, it might be that the sink is leaking around the drain and flowing out to the front edge. You also want to do the same with looking under the sink in the cabinet to see if it’s dry.
If you check all these spots out and they are bone dry, then you almost – through the process of elimination – have to come back to the conclusion that the customer is the source of the problem. You don’t mention how old the kitchen is, but I would think that it would take a fair amount of water to cause the bubbling to have happened twice in a short period of time like this situation.
Let us know how it turns out and good luck to you with this!
If you can replace some of the trim that was applied under the sink, try the following: If there is no trim, simply order the stock and field attach it. Order a length of 3/4" solid stock and have it undercut. If you profile the front edge of the solid stock, it will look as though it belongs there. This will break any water that should drip or cascade down the front of the sink. In fact, it will fall to the floor instead, preserving the sink.
If you look closely at exterior window sills, they have the same cut on the exterior underside.
I’m in the process of designing a kitchen with a limestone hood. The client likes the hood, we’ve been to the hood showroom and we were ready to move forward until her neighbor brought up the issue of staining.
Has anyone used one of these limestone hoods and had any negative feedback or otherwise on upkeep, cleaning or staining? I would really like to use the hood as, aesthetically, it will look great with the overall design. But if there are issues with upkeep, the client should be aware of this, I believe. Thanks for your help!
I grew up in an area that quarried limestone. They used it everywhere: porches, window sills, exterior fascia, sidewalks, driveways, etc.
It’s porous. It’s going to stain.
What does the showroom/manufacturer say? They probably have a “care and maintenance” booklet that should give you information. Otherwise, you might want to check with stone countertop fabricators who work with limestone.
I just recently did a kitchen and the countertops have not arrived yet. It was the first time in a very long time that I was responsible for the entire labor. We’re talking about a small kitchen with small amounts of labor, some plumbing and an electrical plan.
However, I neglected to specify a separate circuit for the microwave. Along the way, the woman’s ex-husband asked me a few questions about circuits, etc. Since my husband is an electrician, I put him into action.
It appears that there are 18 receptacles on one circuit and two on another circuit. The two are at the end of the peninsula, unlikely to be frequently used. The 18 include two two-receptacle boxes in the room beyond the kitchen, plus plug mold receptacles, and a receptacle to accommodate countertop appliances and the microwave.
I looked to see that a toaster alone can take up to 12-15 amps. Meanwhile, her microwave takes 11-1/2 amps.
My question is, isn’t it reasonable, not so much to have the electrician automatically do a separate circuit for the microwave (it doesn’t have to be on a separate circuit by code), but to at least put some thought into the distribution of the receptacles? There was a contractor on the job as well, but I’m responsible for the payment to the contractor and he’s going to be looking for his money today. The cabinets are in, the countertops are not yet installed. What would you do at this point?
It would be difficult, but hopefully not impossible to add a separate circuit now.
If you review the specifications from microwave manufacturers, all of them say that the warranty will be voided if the microwave isn’t on a separate electrical circuit. I strongly suggest that you put the microwave on a separate circuit.
I need to disagree, that’s not so. Nothing anywhere says you must give the microwave a separate circuit. Our local code says you need a minimum of two appliance circuits in the kitchen, and that’s all it specifies.
I should have specified it to have a separate circuit, but it’s not a code or a warranty issue at all. Now I’ll have to add a circuit or two, if that’s even possible to fit into the existing box. I’ll check.
Okay, here’s an update: I finally spoke to an electrical inspector who said that the microwave does not have to have a separate circuit and that in a residential building, you can have 100 receptacles on one circuit, and one on another, and it’s perfectly fine. So, now, I have to supervise the electrician as to how many receptacles are on how many circuits, too! I have never had this problem before. So, there are 18 on one circuit, and two on another circuit.
Here in Ontario, Canada, all appliances have to be on a dedicated circuit, and that certainly makes sense to me. If your customer decides to run her toaster and microwave at the same time, there she blows. That 15 amp circuit isn’t going to handle that load.
I would just like to add that in a previous home I lived in, my microwave was on the same circuit with the outdoor receptacles. We found this out by using the microwave while the Christmas lights were on. What happened is that it would cause the circuit breaker to go into action. It was very annoying, to say the least!
I am reviewing all of this as I’m taking the CKD test in two weeks. To stay abreast of these issues, I will keep practicing the mechanical plan, noting the circuits for each appliance.
In our area (Connecticut), the microwave must be on a separate circuit if it is built-in (i.e. with a trim kit). If it is not, then it can be as any other outlet.
I just came back from a week’s prep class for the test. For the mechanical plan, the NKBA wants a dedicated circuit for each major appliance, including the microwave. That includes countertop installation. My understanding was that it is in the national code.
The following statement is from a Sharp countertop microwave booklet: “The electrical requirements are a 120 volt 60 Hz, AC only, 15 amp or more, protected electrical supply. It is recommended that a separate circuit serving only this appliance be provided.”
In New York, that would be enough for many inspectors to require one.
The NKBA also wants two separate circuits for backsplash outlets, though I don’t think they’d like 18.
Please let us know more about the test! I would also be interested in knowing when are you planning
on taking it?
That’s also a good recommendation from NKBA. I’m sure it’s not in the national code, as I spoke with the inspector, hoping to have a good argument for that. And, it was acceptable to have all those individual receptacles (including some doubles and the plugmold) on one. The inspector said that was perhaps not wise, but was still allowable. According to our local code, it recommends that there be two circuits in the kitchen – at a minimum.
I’ll be taking the test in September and figure that taking it now will leave enough time to address the gaps in this issue.
Basically, I have a very hard time getting straight answers when it comes to electric code questions.
The National Kitchen & Bath Association said that the NRC now says to follow manufacturer recommendations for electric, and with the “cover your butt” approach that the manufacturer takes, every appliance seems to recommend a separate circuit.
But I honestly don’t see that working in real life practice. I just asked an electrician about it in one area that has pretty strict inspectors and he didn’t seem worried. They also indicated two circuits are appropriate for backsplash outlets, you just have to have every major appliance on a separate, dedicated line.
I took the prep class last August and even though the guidelines were changing, I wanted plenty of time to practice the drafting. The prep class was definitely worth it as the instructors gave us a timed test and then sat down with you to give you constructive pointers and ways to improve. I would never have been able to finish the test on time without the class. I also ordered the most recent test prep notebook. It has a practice test and solutions.
I took a look at their mechanical plan legend as you do have to dedicate a circuit for each appliance and give the volts and amps plus the height of the receptacle.
I did three practice tests and felt much more relaxed going into the exam. I don’t know if I passed, but at least I know that by finishing all the parts, I have a shot at passing. I think the experience was well worth my time.
Editor’s Note: Material for Pro to Pro has been excerpted from the online Designer Discussion Forum at the KitchenBathPros.com Website under an exclusive agreement with Kitchen & Bath Design News.
KitchenBathPros.com is an online networking community for kitchen and bath professionals whose goal is to create a central forum for industry professionals, open 24/7, through which they can collectively share knowledge and information. This sharing of resources enhances the industry’s value to the public, builds more successful businesses and raises the bar of excellence in the industry overall.