Overview

Many locations and brands today pay their instructors and service providers based on percent of moneys collected for the private or class session. This is a means to create a margin or profit for both the service professional and the business itself. In response to this use case, we have updated our Payroll Tier configurations to allow business owners and location managers to assign a percentage of session purchases to be calculated in the payroll report.

 

As a business owner, I want to assign 30% of the session earnings as a payroll tier, so that it will calculate for instructor payroll.

As a business owner, I want to assign a flat rate of earning for sessions paid via unlimited credits, so that it will calculate for instructor payroll.

 

Instructions for use

As an Admin user, navigate to the Edit Profile option in the drop-down menu location in the upper right of your Dashboard. Along the left side, select Payroll.

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To create a new tier for Percentage payout, click the Plus sign and then Add Payroll Tier

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Your new tier should be visible in the drop down, select the new tier and then we can add configurations and assign Staff members.

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Click the plus icon next to the Tier Configuration option.

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Select the appropriate Session type to which we will be configuring a percentage sale to payroll. In this example here I have selected Group Classes.

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Next you will need to select from the Payroll Types available. The two new options are at the bottom of the list.

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The two new Percent per Credit options function to calculate a percentage of the amounts paid by your clients for the session and reward your instructors via payroll that value.  As an example, lets select Percent per Credit/ Amount Paid and insert 50 as the percentage. And we will illustrate the math involved with this option.

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With the above configuration saved, we can expect then that all known credits values and drop-in fees will be multiplied by .5 to calculate your instructor’s payroll amount.

Imagine then that a session booked for 10AM on Tuesday has 10 clients booked and paid.  This session has the Session Type = Group Classes as configured for this tier.

When you run Reports > Staff > Payroll and filter for this tier, then the line item for class and its 10 participants will total the amount earned for your staff member / instructor.

As a matter of example let’s say the 10 clients paid with the following options:

4 clients paid with a single credit from a standard package you sell of $100 for 10 credits.  The individual value of each of these package credits are then $10 each (100/10). Since 4 clients used the same page, we can expect then $10 from each added to the total earnings of this session.

4 more clients paid with a credit from a different package you offer where 20 credits cost $180. This makes their individual credits (180/20) equal to $9. These 4 clients contribute an additional $36 to the session’s earnings.

And then lastly 2 client pays the drop-in rate configured in the session that is $15. These two clients contribute $30 to the Session’s earning.  The total session is now worth $106.

(4 x 10) + (4 x 9) + 30 = $106.

Now in the Payroll report these sessions will be multiplied by the percentage of earning based on the tier of the instructor. Let’s say Sally has this tier assigned to her and she was the instructor of said session at 10 AM on Tuesday.  The session value of $106 is multiplied by the configured 50% for this tier and session type and then as such Sally earns $53.

Our system will find the true invoiced value per credit used and of course the true invoiced value of the drop-in rates per Paid client in a session and calculate the earnings for your instructor.

When a session credit cannot be determined as a true invoiced value it is likely this credit is from an Unlimited Credit package or membership. If your facility offers unlimited session access via membership or package sales, in addition to limited credit package and membership or instead of, then the following configuration should be used.

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With this optional configuration we are asking that you pre-calculate a rate for all credits used from an “unlimited” package/ membership for this session type.  This will mean then that as the system sees credits from unlimited it will assign the base rate, in the example above as $7.

Let us repeat the 10AM Tuesday session example above that Sally instructs.  In this case we had 15 total clients booked and paid for this session.

Again, 4 clients paid with a single credit from a standard package you sell of $100 for 10 credits.  The individual value of each of these package credits are then $10 each (100/10). Since 4 clients used the same package, we can expect then $10 from each added to the total earnings of this session.

4 more clients paid with a credit from a different package you offer where 20 credits cost $180. This makes their individual credits (180/20) equal to $9. These 4 clients contribute an additional $36 to the session’s earnings.

2 client pays the drop-in rate configured in the session that is $15. These two clients contribute $30 to the Session’s earning.

Now 3 additional clients paid with credits from their Unlimited Class recurring membership to which that pay $250 a month. Being that we never will know exactly how many credits will use each month for that $250, the system can never calculate an exact value per credit. This is why you assigned a value in the tier configuration. In our example that value was $7 for the session per client.  Thus 3 clients at $7 equals $21.

All together we then have $40 + $36 + $30 + $21 = $127 total dollars paid for this session.

The payroll report will calculate the following: $106 multiplied by 50% and then the $21 is added for this session, as such Sally earns $74 ((40 + 36 + 30) x .5) + 21 = $74.

 

Here are images of the Payroll report where Percent per Credits are used.

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Continue to set up the appropriate Percent per Credit options for each Session type you require calculations on. This may include your one-on-one session types as well as classes or even workshops.

 

 

 

 

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