Compensation:

Although SOLANO’S INC is a small firm, our management has taken considerable time and effort to develop a forward thinking compensation plan, quite advanced for our industry.  The major elements of plan will be discussed below.

What is reasonable for our industry:

SOLANO’S reviews financial data provided by the North American Retail Hardware Association for hundreds of hardware stores, home centers and lumberyards.  This data includes detailed payroll expense information related to sales for the various types of businesses.  This information provides guidance as to what are reasonable staffing costs and other expenses for our industry.

Annual business planning:

In November of each year detailed budgets are prepared for each store and the corporate staff for the new year starting in January.  The store budgets include only expenses that can be affected by the store manager and staff.  Supporting expenses controlled by the CEO are located in the corporate staff budget and are not allocated to each store as they were in the past.  Prepared by the CEO and the Research Analyst, the budgets may be reviewed and adjusted in meetings with the store managers and CEO.  Prior year data is used to forecast seasonal monthly variations in sales, margins and expenses. The completed budget/financial plan then becomes the baseline used to measure company performance.

Sharing the gain and pain:

Performance Plus is the name of the program developed by SOLANO’S to share company performance results with our employees.  In simple terms we wish to share performance that exceeds our business plan with all of our employees. 

The Performance Plus program rewards all employees equally when total company monthly margin exceeds budget by more than $2500.   Each employee on the payroll for any part of the subject month receives an additional $50 in wages. This program is meant to be recognition of a team effort in which all members of the team contributed and are rewarded equally.

Rewards are included in the payroll checks issued on the 20th of the following month.

In addition to the Performance Plus compensation, Solano’s utilizes a manager’s bonus plan based on store performance including sales, gross margin, expenses, site reviews, safety performance and other factors.  These compensations are determined at the discretion of the CEO and apply only to store managers, assistant managers or other specific cases.