Is Dan Price a really nice guy, a sincere employer, a keen businessman or 😉😉😉😉

Providing a minimum wage of $70,000 which is well above market is a pretty good deal; a nice gesture indeed.  From everything I have been able to read this is a smart guy who took a chance at age 19 and won and deserves a lot of credit and his rewards. Listening to him speak he seems sincere in his motives, and a bit naive as well. I heard him say he knew there was a risk in what he was doing, but that his business was never about making money, but rather helping people, especially small business. That must be a Seattle thing.

And you have to wonder with that business philosophy why, before he had his $70,000 epiphany, he was paying himself $1 million a year in a company earning $2.2 million.

According to the New York Times, Mr. Price, said he would pay for the wage increases by cutting his own salary from nearly $1 million to $70,000 and using 75 to 80 percent of the company’s anticipated $2.2 million in profit this year.

All will be well as long as his business continues to grow and there are no economic bumps or creative competitors. With such a modest profit and now up to 80% going to wages, his ability to grow the business may be hampered and how will he accumulate reserves needed for an emergency?

Let’s hope his employees are happy and remain so because if they want to leave or have to, market pay levels will be quite a slap in the face. Let’s hope he doesn’t have to ask any employees to leave because he just made it harder to do. Nevertheless, as soon as the publicity and euphoria wear off and the $70,000 is part of regular pay checks, that pay will no longer be appreciated or motivational, but expected as will additional raises after employees change their lifestyles to their new income level. 

I wonder what the majority of employees who are not getting a whopping raise think about this windfall for their coworkers?

A more prudent move would have been to pay market competitive wages, and good tax-favored benefits while introducing a robust, but manageable profit-sharing arrangement thereby raising incomes but also managing the risk with an ongoing motivational element. Of course that wouldn’t get you on the Today show.  

Oh well, best of luck to Mr. Price, his business and his employees. Let’s hope his fifteen minutes of fame is worth it. It’s a nice thing to do, at least in the short run.