Employee Investment

     Capitalism would have succeeded if employees could 
have invested in their workplace.  Not just stocks, but 
the working fund as well.  If employees had been 
offered the opportunity to gain from their investment 
from the net profits they would have been more 
motivated to make the company work profitably.
   The faster a company turns over inventory the 
greater their profits, potentially.  They're not going 
to make money if it costs more to operate than their 
sales so employees are motivated to maximize efficiency 
and profits if they're invested.
   As an example lets say a gas station has an account 
for buying gas that they sell to the public.  They buy 
the gas wholesale, mark it up, and hopefully sell it 
for a profit after rent, utilities, supplies, labor, 
etc. have been paid.  Suppose the account from which 
they bought the gas, and paid expenses, consisted of a 
fund where employees could contribute, like a savings 
account.  Periodically, once a month or so, the 
profits, if they made any, would be put back into the 
fund with each employee gaining a percentage of the 
newly contributed profits based on the amount they had 
contributed to the fund previously.  Imagine the 
motivation of an employee to make this fund grow if 
they'd invested as opposed to just collecting a 
paycheck. Loss to their fund value would motivate the 
employees even more to make the business work 
profitably.
   Unfortunately today's business model leaves 
employees without an invested interest in their 
workplace.  It's to the employees best interest if the 
customer goes away, buys less inventory, and the 
employee will have less work to do.  When an employee 
just collects a paycheck, profits, in reality, are just 
extra work.  No matter how well intentioned a person 
is, sooner or later they have to give in to the laws of 
physics and prefer an easier life if they can get it.  
The retribution to business is far more devastating 
than we suppose.  Employees slough off work, 'drag 
their feet', and even drive customers away in order to 
reduce their work load.  The effects are devastating to 
the business and to the overall economy in a 
capitalistic system.
   Another advantage employees may experience, is if 
the fund is successful it may attract outside 
investors.  A larger investment fund may mean lower 
costs on inventory thereby creating a greater 
opportunity for employees to create profits.
   The equation is more complicated, of course, but not 
much.  The business owners, maybe with input from 
employees, will have to figure out a formula for 
disbursements of funds that work for their service 
inventory ratio.  A gas station owner, for example, 
will tell you they don't make a profit on gas but 
rather the services they offer.
   Part of the reason direct employee investment hasn't 
transpired in our economy is that a small business 
start-up owner feels obligated to pay employees for 
their time while the business is starting to grow to a 
point where it can make a profit.  He or she can't 
guarantee profits at start up, so it would be difficult 
to find people who wanted to work and loose money when 
the business first opens.  Once the business is 
profitable, and most (95%) never make it to this point, 
the business owner would be making a personal 
compromise, a sacrifice, to include employees into the 
profit margin they worked so hard for and took the risk 
on.
   On the flip side, for employee investment again, if 
the investment plan could supplement outside 
investment, it may offer alternatives to bank loans or 
note selling.  If the conditions set forth for the 
employee investment fund were similar to those of a 
bank loan, for example, then in reality, the employees 
may be taking an efficient short cut to collecting 
interest on their savings account via direct investment 
in the business and the business owner could save the 
expense of having a loan processed.
     Anyway you look at it, the economic fabric of 
capitalism would be much stronger if employees invested 
directly into their workplace.


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