Two Commission Rates System for Pet Groomers

Building Better Wage Systems for Both Groomers and Employers

Authors face potential prejudice when writing about compensation systems for groomers. Often they are presupposed to favor the plight of management versus groomers struggling to earn more. In fact, many authors simply avoid writing about groomer compensation. Why stir things up? At Grooming Business in a Box® we relish writing about groomer compensation systems as well as other management issues.

It’s our purpose to destroy the problematic fence between staff and management relations. Our original book From Problems to Profits: The Madson Management System was a first step, and the “Box” is another. We politely challenge most of today’s grooming management, mostly independents, to treat personnel better, even legally. Have you heard anyone else writing and speaking so boldly about the dilemma of misclassifying groomers as independent contractors, or underpaying pet bathers? We are going to introduce some simple solutions. Up to 90% of groomers and business owners with staff do not know the information to be presented here. Keep an open mind, the numbers tell quite a story, not opinion.

There are two benefits from using our Two Commission Rates System. One is for employers, and one is for employees.

  1. Eliminate mistaken claims relating to employers seemingly making their employed groomers “pay” pet bathers as if they are secondary or substitute employers.
  2. Boost pet groomer wages while and yet reduce gross payroll, and without asking groomers to groom more pets or work longer hours (yes it is possible).

Do you know how many groomers don’t believe either benefit is possible? Plenty. We don’t blame them. Most business authors or employers don’t “show their work” to back their claims with clear financial proof. We do. Get ready.

Employers often make a serious mistake of semantics when they advise their employed groomers they must “pay” for bather support. Employers cannot require employees to assume the duties and responsibilities of being employers in their businesses.

How does this happen? Many employers use commission wage formulas paying groomers percentages of grooming service fees in return for grooming pets start-to-finish with no bather support. When employers have pet bathers on staff situations may arise where commission groomers opt out of bathing one or more pets a day. Groomers being paid to bathe and style pets should not get full commission when they don’t groom start-to-finish. Employers have to a wage calculation formula to prevent overpaying start-to-finish groomers opting out of doing services they are being paid for in their commissions.

Unfortunately employers addressing this situation often say to their start-to-finish commission groomers, “You must pay bathers when you don’t do the bathing.” Danger! A can of worms has been opened, even Pandora’s Box. Only employers “pay” employees. Employed groomers may use the “pay” term when sharing with others how their wages are calculated. Eventually someone responds and reminds employees that employers cannot make them “pay” other employees. Suspicion barks. Sparks fly. For the most part, the problem is with semantics and it can be avoided entirely.

This problem can become severe when confused employees contact legal assistance or government agencies related to employment law. Neither attorneys nor the government understands pet groomer commission systems. The problem is employers could better use terms such as “reimbursement” or “adjustment.” Even then, there are strict guidelines as to what is to be reimbursed by grooming employees opting to use bathing support.

Employers using the term “bather reimbursement” instead of saying someone else must “pay” their bathing employees are more correct. However, they are still wading in potentially troubled waters. How are employers figuring the reimbursement amount? They had better be able to explain how they calculate bathing reimbursements when asked by employed groomers, or representatives of employment law and tax agencies.
What is the problem we see? Employers should not require the full-charge groomers to reimburse them for any costs related to benefits, payroll taxes, workers compensation, unemployment insurance and similar employer-related costs. Otherwise they are once again coloring the affected groomers as if they are employers. Employed groomers are never employers of pet bathers assisting them!

It is more correct for employers to review the gross wages of bathers and to figure (approximately) the average gross wage of their bathers per pet. It’s simple to do.

Employers first state and publish their expected performance standards for experienced bathers. The standards should be stated in related job descriptions and agreements. There are examples in the book From Problems to Profits.

Assume a pet bather is paid $12.00 an hour and they average 12 bathing assignments in 8 hours, no overtime. What is the average time spent by the bather per pet? Divide 8 hours by 12 pets and the answer is an average of 40 minutes per bathing assignment.

Remember this figure is an average. Don’t complicate calculations figuring for occasional dematting sessions which extend work time. We are looking for a reasonable, general average bathing time per pet by experienced bathers.

When the hourly wage is $12.00 an hour, 40 minutes is $8.00 gross wages. The overall average cost of gross pet bather wages is $8.00 per pet for this business. Expect variations between businesses when compared.
In the example above, the employer now has a general pet bather reimbursement fee of $8.00. It only addresses gross wages and no other employer-related costs.

Whenever employed groomers paid by commission for start-to-finish work opt out of bathing and use their employer’s bathers, they adjust their gross commission wages deducting $8.00 per pet not bathed. In this way, employed groomers are not literally “paying” for bathers. They are not creating paychecks. They are reducing their paychecks avoiding overpayment for work they did not do.

The “per pet” reimbursement system is not perfect. Every employer should review this system with their company attorney for compliance with state and local law before implementing it. The per pet system has been widely used for decades, whether its proper use was verified or not. Where it is used, employer communications with affected groomer employees often creates confusion. Employer semantics make it sound as if the employed groomers are acting as employers ‘paying’ bathers instead of simply reducing their gross commission wages to compensate for opting out of their commission paid bathing duties. We suggest simplicity.

How about something altogether different with no legal confusion between employer and employee status? We call it the “Dual Rate Commission System” or to some, “Two Commission Rates System.”

It favors both employees and employers. We’re straddling the fence between them and saying sometimes new ideas actually work well for both. Here’s the magic and absolute proof.

The concept of the Two Commission Rates System is simple. Unfortunately most employers don’t know how to do the relatively easy calculations, and how to prove its benefits to their employees. We can fix that problem.

The system is easily applied to any pet grooming business paying by commission and employing bathing staff. Instead of one commission rate universally applied to every grooming assignment for start-to-finish grooming, there is a second commission rate. It applies only to those grooming assignments where full-charge groomers paid for start-to-finish grooming opt out of bathing and use their employer’s pet bather services.

COMMIISSION RATE #1
Commission Rate 1 is the highest rate because groomers spend more time grooming pets start-to-finish without pet bather support.

COMMISSION RATE #2

Commission Rate 2 is lower because groomers spend less time grooming and have the assistance of pet bathers. More important, Commission Rate 2 also allows full-charge groomers to groom more pets per day and earn more.

Don’t be mistaken! Rate 2 does not mean lower gross wages. Groomers using the lower Rate 2 in our system actually earn significantly higher wages than Rate 1 groomers working the same hours, and grooming the same pets at the same prices. No tricks here! This is rarely known by groomers today. Setting the Commission Rate 2 correctly is important, and it must be fair to employed groomers. Again, it’s easy.

Fortunately we have a good start to set a correct Commission Rate 2. Earlier in this article we discovered the average time to bathe and dry a pet (including nails and ears) was 40 minutes. We also stated the bather was paid $12.00 an hour, and therefore 40 minutes of gross bather wages (before taxes) was $8.00 per pet. You will need to figure the per pet fee based on your operation.

Commission Rate 2 actually reimburses the employer about $8.00 per pet when employed groomers opt out of bathing and request bather support.

Using Commission Rate 2 for affected grooms means no more counting bathing reimbursements and deductions from gross wages as did Groomer 2 in the illustration on page 39. Instead, groomers and employers track how many grooming assignments are paid at Commission Rate 1 and how many at Commission Rate 2. Simple!

Setting Commission Rate 2 need not be a challenge. It’s commonly between 35% to 38% for most businesses when its other groomers doing state-to-finish grooming including bathing are paid 50%. Follow this procedure below.

Working with our previous example, we want to reduce Commission Rate 1 to recoup about $8.00 per pet. In our experience we discovered Commission Rate 2 is usually 12% to 15% less than 50%. Start there and test the results.

Total Grooming Fee $60.00
Commission Rate 1 50%
Groomer’s gross wage is $30.00.
Commission Rate 2 35%
Groomer’s gross wage is $21.00.

The difference between $30.00 and $21.00 is $9.00. That’s too high. Our goal is $8.00, not $9.00.
Let’s redo our calculations assuming Commission Rate 2 is 37%.

Commission Rate 1 50%
Groomer’s gross wage is $30.00.
Commission Rate 2 37%
Groomer’s gross wage is $22.20.

The difference between $30.00 and $22.20 is $7.80. We’re close enough to $8.00 and without going over.
Now we have our two commission rates and no need to further calculate reimbursements for bather support in the future.

Perception is important. Employees will balk at the Two Commission Rates System unless it is properly explained, and even lose sight they can increase their wages without bathing.

When introduced to the Dual Rate Commission System some groomers are sure to think they are earning less accepting 37%. Yes they are, but no less than if they were paid 50% and deducted $8.00 bather reimbursement fees where applicable. In fact, with Commission Rate 2 shown above they get paid 20 cents more. They must also realize they can groom more pets when freed from bathing and boost their paychecks.

Sit down with full-charge groomers and patiently explain to them clearly what you learned here. Provide examples, including the illustration on page 59. In about 30 minutes they should catch on.

Remind them, pet groomers that never bathe earn more income than start-to-finish only groomers when both work 8 hours? Make sure they understand the difference between Groomers 2 and 3 and how they earned about $11,000 a year more in gross wages working the same hours, grooming the same pets at the same prices. Numbers don’t lie.

Wait! When previous start-to-finish groomers no longer bathe they will earn less unless you give them more styling assignments to fill 8 work hours daily. Expect some or all of your employed groomers to balk at change. They may have a vice grip on reasons why they must bathe.

Some full-charge groomers believe they must bathe and dry their pets because bathers won’t bathe and dry pets as well as they can. If that is true who is to blame? Management. We trained and employed expert bathers that did every bath perfect, or they had to redo their work. No exceptions. When stretch-drying was needed, every curl had to be hand stretch-dried with a brush. The force of any HV dryer is not enough to adequately stretch dry in our opinion. Assure your full-charge groomers that every bathing assignment will be to their standards, and make it happen.

Our Bathing Department Supervisor (see From Problems to Profits book) ensured every bathing assignment was quality control checked before going to finish groomers. Simple solution. Implement the position straight away to enjoy fewer problems.

Some full-charge groomers have reason to exert control over their grooms for other reasons, sometimes kept secret. You may have to peel layers like those of an onion to discover why they feel the need for ardent control. Most reactions come from past issues working in less than well-managed businesses.

You should have fewer problems when employees realize the full impact of this information when explained well. Show them how Groomer 1 is losing $11,000 a year in gross wages simply by doing all bathing related duties.
Common sense efficiency experts reviewing the steps of a full groom immediately note that any work done by the highest paid employees (full charge groomers) that could be done by other employees paid less (bathers) means both profit drain for employers, and potential loses for employees in a fair compensation system. It never makes financial sense for full-charge groomers to do duties associated with pet bathers. It costs them dearly in wages, and for the owner it depresses gross sales when groomers could be grooming more pets daily.

SHOW ME THE NUMBERS!

Now how about more proof? The numbers don’t lie, and the expectations for the groomers are absolutely reasonable for experienced groomers. In fact, here are three scenarios for the same groomer doing the exact same pets and same prices working same hours. Here is proof that the pet groomer will earn about $42.00 a day less doing pets start-to-finish instead of using bather assistance and thereby being able to groom more pets, 12 a day on average instead of 7. Over a year the groomer working start-to-finish loses almost $11,000 in gross wages. Take a look.

Groomer 1 - Start-to-Finish Grooming
NO BATHER ASSISTANCE
7 Start-to-Finish in 8 Hours
Same Prices, Same Pets Groomed by Groomers 2 and 3
PetGrooming FeeGroomer's Wage
Pet 1$60.0050% Wage = $30.00
Pet 2$55.0050% Wage = $27.50
Pet 3$48.0050% Wage = $24.00
Pet 4$56.0050% Wage = $28.00
Pet 5$55.0050% Wage = $27.50
Pet 6$64.0050% Wage = $32.00
Pet 7$70.0050% Wage = $35.00
Pet 8$72.00N/A already worked 8 hours
Pet 9$39.00N/A already worked 8 hours
Pet 10$74.00N/A already worked 8 hours
Pet 11$50.00N/A already worked 8 hours
Pet 12$42.00N/A already worked 8 hours
TOTAL DAILY GROSS WAGE
$204.00
ANNUALIZED
$53,040.00

And now Groomer 2, who is still Groomer 1 but using bather assistance.

Groomer 2 - Finish Grooming Only
BATHER ASSISTANCE
12 Grooms in 8 Hours
$8 Per Pet Deduction for Bather
Same Prices, Same Pets Groomed by Groomers 1 and 3
PetGrooming FeeGroomer's Wage
Pet 1$60.0050% Wage = $30.00 (-) $8.00
Pet 2$55.0050% Wage = $27.50 (-) $8.00
Pet 3$48.0050% Wage = $24.00 (-) $8.00
Pet 4$56.0050% Wage = $28.00 (-) $8.00
Pet 5$55.0050% Wage = $27.50 (-) $8.00
Pet 6$64.0050% Wage = $32.00 (-) $8.00
Pet 7$70.0050% Wage = $35.00 (-) $8.00
Pet 8$72.0050% Wage = $36.00 (-) $8.00
Pet 9$39.0050% Wage = $19.50 (-) $8.00
Pet 10$74.0050% Wage = $37.00 (-) $8.00
Pet 11$50.0050% Wage = $25.00 (-) $8.00
Pet 12$42.0050% Wage = $35.00 (-) $8.00
TOTAL DAILY GROSS WAGE
$246.50
ANNUALIZED
$64,090.00

And now Groomer 3, who is still Groomer 2 but instead of being paid 50% commission per groom less $8.00 as a bather assistance reimbursement to the business owner, Groomer 2 gets 36% commision, bather included. Is it not essentially the same wages for the day?

Groomer 3 - Finish Grooming Only
BATHER ASSISTANCE
12 Grooms in 8 Hours
36% Commission, Bather Included
Same Prices, Same Pets Groomed by Groomers 1 and 3
PetGrooming FeeGroomer's Wage
Pet 1$60.0036% Wage = $21.60
Pet 2$55.0036% Wage = $19.80
Pet 3$48.0036% Wage = $17.28
Pet 4$56.0036% Wage = $20.16
Pet 5$55.0036% Wage = $19.80
Pet 6$64.0036% Wage = $23.04
Pet 7$70.0036% Wage = $25.20
Pet 8$72.0036% Wage = $25.92
Pet 9$39.0036% Wage = $14.04
Pet 10$74.0036% Wage = $26.64
Pet 11$50.0036% Wage = $18.00
Pet 12$42.0036% Wage = $15.12
TOTAL DAILY GROSS WAGE
$246.60
ANNUALIZED
$64,116.00

How easy! There is the proof that 36% commission in this business pays the same as 50% commission less $8.00 per pet for bather assistance. Now the groomers don’t have to say alarming statements like, “I am paying the bathers!” You can adjust the actual commission rate from 36% to match your average bather reimbursement fee if more or less than $8.00 per pet.

SUMMARY OF THE TABLES

  • Every time Groomer 1 bathes and dries pets wages suffer. Groomer 1’s wages are about $11,000 a year lower than Groomers 2 & 3 grooming the same pets without bathing.
  • Providing bather support does not have to boost overall payroll costs. It can even lower them!
  • Freed from daily hours of bathing-related duties groomers finish more pets to boost their wages even after deductions for bather support. Groomers 1, 2 & 3 work 8 hours a day.
  • Groomers 2 & 3 each do 5 more pets a day boosting their gross wages about $11,000 a year more than Groomer 1, and their employer enjoys $247 more a day in gross sales too. It’s a true win-win situation.
  • Lower commissions do NOT always mean lower wages. Adjusting rates for bather support can mean equal or higher wages. Groomer 3 works the same hours doing the same pets as Groomer 1 and grooming fees are equal for both. Groomer 3 at 36% earns $11,000 a year more gross wages than Groomer 1 paid 50% commission rate. As a result, Groomer 1 pays the price simply for bathing pets!

If you want to learn even more about grooming wage systems, we suggest you buy Pet Groomer Wage Systems by Grooming Business in a Box. It includes a CD and User Guide.

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