Instructor compensation

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Jane_dives

Registered
Messages
14
Reaction score
4
Location
Coral Springs
# of dives
200 - 499
Hi all, thanks for any help in advance. Operating in a population dense tourist area with year round diving, and was wondering what the industry standard was for paying the instructor, particularly refresher classes and referrals. I was surprised to learn that my instructor expected the same rate of compensation for two check out dives as for four. It's twice the work or half the work, or am I missing something?? I spoke with another dive shop and they said this was indeed the case. :idk:

Also, I appreciate when the instructor takes time to discuss computers and BCs with the students, as he has a rapport with them. I would like to express my appreciation, but my partner says we cannot afford even a five per cent commission, but could perhaps pay an overall "performance bonus." Any thoughts on this as well appreciated.
 
Pay here is based on work done so two dive course would not pay the same as a 4 dive course. From what you describe a 4 dive (2 day course) would be paid the same as a 2 dive (one day course). Someone is getting screwed in this system- either you are overpaying or someone is getting underpaid.

I would look at your pricing for classes and what you are paying per day. We break our classes down to dives and class sessions so we can split pay if instructors only teach part of a class. You can also talk with your instructors and you might be surprised at some of their good ideas.
 
One more thing, I was also wondering if people get any volume and level of interest in the EFR classes, TIA,
Lauren
 
as a new shop looking to hire someone just to do some confined water work I had a newly minted instructor come in and say he wanted $35/hour:no:. Sorry but after pool lights, rent and heat that's just outrageous. I do agree though why would two dives get paid the same as four.
 
as a new shop looking to hire someone just to do some confined water work I had a newly minted instructor come in and say he wanted $35/hour:no:. Sorry but after pool lights, rent and heat that's just outrageous. I do agree though why would two dives get paid the same as four.

So this new instructor wanted something like $640. to teach a entire ow acad/confined water class...I only get that much,and I have been teaching for 39 years, if I have a private group of 4 that paid the facility $1700.(comes out to 40% of course fee)and that is on the customers ever changing schedule,not a regularly scheduled course.
Totally understand the costs involved to run a class,I had the same issues when I owned a 5 star. I would'nt even hire a unknown newly minted instructor unless I trained him from at least DM/AI.
Either pay the instructor a flat rate for a standard/scheduled acad/confined water, around NY it can be $250.-$300 for ow course OR pay hourly $16.-$18 per hour..
For a private class ,40% of course fee or $240. for 1 student/$480. for 2 private students is appropriate.
For ow training dives $80 per student is about the right number.If less than 4 students instructor should get minimum of $300. for the weekend. plus tips :D
 
I'm curious to find out how the rest of you guys feel about equity splitting / profit share arrangements. My background is a little different to most in this industry. I come from a business consultancy background, and got into this industry as a hobby to get away from what I was doing previously. Thus far, this has turned out to be somewhat permanent (for now anyway...) Anyway - what I find fascinating about this industry is that somebody is actually willing to work for say $16 per hour (or roughly $30-$40K a year full time), when they could earn much more doing pretty much anything else. The thrill of the sport aside - if you live in a larger more populated area - lets face it - an instructors salary is usually on or below the minimum thresholds of what is needed to live a comfortable life. From past experience, I have noticed that low salaries = high turnover = variability in the customer service experience = inconsistency in teaching = attracting a transient work force = all sorts of daily problems..... I also realise that paying more means charging more - and that is not always possible either....

Question is therefore this - has anybody thought of / seen work in this industry an equity splitting model, whereby instructors become temporary minority shareholders in the business, and share in the net profit of the store, on top of a basic base salary? This model is popular in other industries, and I am just wondering if this would / could attract more professional instructors, and encourage them to stick around longer and work harder to grow the business overall... It may also lead to a good succession plan longer term.....

Anybody got any opinions / thoughts on this?
 
Hey Going Down,

I like where you're going with your thoughts on this one. How would it work in terms of real world business setup? I'm talking formalities here - are there any reading resources on how to do this legally without getting shafted in the longer term? Can you provide examples of how this has worked in other industries and been successful?

Thanks
André
 
Andre,

Not a problem.... Here is a basic example of profit sharing that could be easily implemented:

1. Work out your fixed costs for the year. This will include rent, utilities, cost of merchandise etc. Basically, work out your profit margin. If you do not know what that is - ask your accountant or book keeper - whoever does your books each week / month.

2. Don't be afraid to share your fixed cost number with your staff. The easiest way to get staff buy-in is to make them feel responsible and have a vested interested in the numbers themselves..

3. Take that fixed cost number and divide it by 12. This becomes your new sales target for each month. Any staff member who achieves sales above that figure each month gets a bonus. Make the bonus a fixed percentage so that everything is transperant.

4. If you have non sales staff - reward them by assigning a notional figure against their name for the work that they do. Eg - You may have an excellent instructor who sells nothing but does an excellent job teaching. Assign a number to him/her based on the revenue that each client bought into the business - perhaps overlayed with a customer satisfaction score. The higher the score the higher the notional amount assigned to the instructor...

5. Make the whole system totally transperant, and build it into people's employment contracts. You will find that staff will have something to aim for each month - and will help to keep fixed costs down. After all - they have something to gain from this now......

Worked example - in its simplicity....

Fixed costs of business: $120,000 per year (or $10,000 per month)
Shop turnover: $240,000 per year (or $20,000 per month)
Turnover less fixed costs = $240,000-$120,000 = $120,000 (or $10K per month)

2 instructors / sales staff who sell courses and teach. They also sell equipment (or are suppose to). Each now has a $5,000 per month sales target (2 sales people need to cover the overall fixed cost of $10K). This should be easy, as the revenue is already at $20K per month.

3. If they achieve sales of $10K or less ($5K each) - no bonus. This is to cover expenses, and to justify their jobs.

4. If they achieve sales between $10K and $20K ($5K and $10K each), pay them a thank you amount. They are already selling this anyway - but being appreciated never hurts. Say 5%...

5. If they achieve sales over $20K month (10K each), then pay a larger bonus on any amount of $20K achieved (say 10% for the sake of this example).

Mary has a good month in June. She managed to sell several sets of equipment plus courses. Her sales for the month were $12,000. Her bonus would be zero for the first $5K, 5% on the second $5K ($250) plus 10% on the remaining $2K ($200). Total bonus for the month is $450.

Sounds like a lot? - but what are you losing? You pay more when staff try and bring more in. The harder they try, the more everybody makes all round.....

Staff who get rewarded for their actions in an open and honest way will try harder, will work harder, and will make you (and themselves) more money. You will attract better staff who will stay longer - as their salary and earning potential is now in their own hands........

Best person to help you set this up is your accountant - assuming you have a good one of course.

This is a very simplistic example. Don't over complicate it within your business - but make the numbers work for you.....

Good luck with it :)

Ps - in terms of succession planning. Really quickly - a staff member forgoes their bonus (and even a percentage of their salary) to purchase shares in your business. Over time the shares build up. They use this equity stake in your business to approach the bank for funding for the remaining majority that they do not as yet own. The bank will lend based on set ratios (differ in each region), and you have a way to exit the business. Accountant and lawyer set this up.
 
Most of the places I worked at as an instructor would pay expenses first then split what's left in half between the shop and the instructor. They never paid commission on gear which is why everyone didn't push gear sales plain and simple. Having owned my own shop I can say yes, it's very hard to give someone 5 percent in a bad economy but if you can't then you're doing something wrong. 5 percent less on a sale is better than no sale when you have bills to pay and things are slow. Sometimes instead of cash we offered the same value in gear which made them happy as well.

Not to get off track here but the biggest problem we've had is people taking up our time for advice, and then going to the internet to buy even though we could have sold the exact same stuff for less. Most didn't even give us an opportunity to price it out.
 
https://www.shearwater.com/products/swift/

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