My father is 100% owner of our family business and we have plans in motion for me to start acquiring the business starting in January 2026 through a typical owner-funded buyout. Our business typically does yearly sales between $9M and $12MAs of 2019, I make a salary of $175K. That includes commissions and a mid-year and EOY bonus.What’s changed since 2019? Well, most importantly, I’ve taken on responsibilities that would typically line up with that of a Vice President position (though, formally, I don’t have a title and our company doesn’t have a Vice President). I’ve helped my father, the owner, build the business almost back to where it was pre-COVID.Now that we’re recovering a bit from COVID, there’s an opportunity for me to ask for a raise that compensates me better for the new responsibilities I’ve taken on. I’m proposing a base pay of $201,250 (a 15% raise from $175K) and instead of a commission on my own sales, a 5% commission on overall company profits. This way I’m compensated fairly from the leadership-level decisions I make that affect the health of the whole company.What does everyone think?
You make a good point about my raise potentially impacting the profitability of the company. But on the flip side, if my new responsibilities are helping the company’s profitability, I want to be compensated proportionately. I think it’s fair.
There’s only so much focus I can put into the acquisition in two years. The succession plan has been in place for a while now. But if my father wants to start it earlier, I’d be up for that too.