Which percentage split with a cap should i take?

[I_should_really_know_this]

Hi all,

I hope this is in the correct section. I could really use the help as my once solid math skills have abandoned me over the years...

Basically, this real life situation I currently have a 75%/25% split with the owner of a company I do work for. I get the 75%. The company bills $100/hr, and I would like to introduce a daily max that I give him, $100/day. With the cap of $100/day, is it better for me to remain at a 75/25 split or negotiate for a 80/20? The 80/20 might seem like the obvious choice but given I work 4 to 7 hrs a day, a 75/25 split gets me to the daily max cap of $100 quicker (4hrs vs 5hrs if 80/20) after which I take all the revenue.

Which is a better split for me? How do I graph this? I appreciate any feedback.
Thank you.

 

[stapel]

Basically, this real life situation I currently have a 75%/25% split with the owner of a company I do work for. I get the 75%. The company bills $100/hr, and I would like to introduce a daily max that I give him, $100/day. With the cap of $100/day, is it better for me to remain at a 75/25 split or negotiate for a 80/20? The 80/20 might seem like the obvious choice but given I work 4 to 7 hrs a day, a 75/25 split gets me to the daily max cap of $100 quicker (4hrs vs 5hrs if 80/20) after which I take all the revenue.

Which is a better split for me? How do I graph this? I appreciate any feedback.

You're working with percentages, but you don't have a total from which the percentages are taken. Also, you seem to be wanting unilaterally to be changing the terms of your legal contractual agreement. Without loads more information, we can't even begin to approach the math; you'd still be on your own for the legal and ethical issues (along with questions of whether your "partner" would want to contribute anything, if he's capped at $12.50 an hour for whatever it is he does in an eight-hour work day). :shock:

 

[I_should_really_know_this]

You're working with percentages, but you don't have a total from which the percentages are taken. Also, you seem to be wanting unilaterally to be changing the terms of your legal contractual agreement. Without loads more information, we can't even begin to approach the math; you'd still be on your own for the legal and ethical issues (along with questions of whether your "partner" would want to contribute anything, if he's capped at $12.50 an hour for whatever it is he does in an eight-hour work day). :shock:

Thank you for the reply. Sorry for being unclear..I'll try to clarify.

Essentially I am a contract strength coach. The facility owner charges $100/hr to the customers that train here. I or the junior coaches do the work. Until now we've had a 75/25 split, me getting the 75%. I work anywhere from 3-9 hours a day, ie bring in $300-900/day, which we split according to the percentages. Typically though I work 4-7 hours a day. My contract is up for renewal and the owner is keen on keeping me on board and has agreed to use this split up to a max compensation method, and in fact suggested the 80/20 split up to $100 max for the day. As in, if I work 5 hrs with a 80/20 split @ $100/hr, the $100 cap will be achieved (5hrs x 20% of $100/hr) and thus anything I work beyond 5hrs I get all 100% of. The 75/25 split would mean I would achieve the cap of $100 after 4 hrs of work (4hrs x 25% of $100/hr) and anything beyond 4hrs of work I get 100% of. However, I pay a 5% more for the first few hours everyday obviously. To me it doesn't seem like it's going to be a huge difference either way but was just curious which scenario is to my favour.

Hope that clarifies things. Thanks.

 

[I_should_really_know_this]

You're working with percentages, but you don't have a total from which the percentages are taken. Also, you seem to be wanting unilaterally to be changing the terms of your legal contractual agreement. Without loads more information, we can't even begin to approach the math; you'd still be on your own for the legal and ethical issues (along with questions of whether your "partner" would want to contribute anything, if he's capped at $12.50 an hour for whatever it is he does in an eight-hour work day). :shock:

Hmm thats odd..I replied to this but it didnt post so I'll retype it and hopefully not duplicate the post.

stapel, ty for your reply. I'll try to clarify.

I am a contract strength coach at a facility. The owner charges users $100/hr for facility use and coaching instruction. Of this I get 75% and the owner gets 25%. He also has a number of junior coaches who take a smaller split. My range of hours over the last 2 yrs has been 3-9 hours a day, so bringing in $300-900/day. But typically I work 4-7 hours a day. My contract is up for renewal. To keep me on board the owner is offering me a 80/20 with a daily max of $100. With a 80/20, the cap would be reached with 5 hrs of work, any hours after that I would keep 100%. With the 75/25 split and $100 cap, I would achieve the max in 4 hours of work any any hours beyond that I would keep 100%. So I was curious to know which split is in my favour...giving up more but maxing earlier or giving up less and maxing out later. Basically a graph of where the turning point it. I dont see it being a big difference but it may work out to a $500 diff a month.

hope that clears things up. Thank you.

 

[Ishuda]

Hi all,

I hope this is in the correct section. I could really use the help as my once solid math skills have abandoned me over the years...

Basically, this real life situation I currently have a 75%/25% split with the owner of a company I do work for. I get the 75%. The company bills $100/hr, and I would like to introduce a daily max that I give him, $100/day. With the cap of $100/day, is it better for me to remain at a 75/25 split or negotiate for a 80/20? The 80/20 might seem like the obvious choice but given I work 4 to 7 hrs a day, a 75/25 split gets me to the daily max cap of $100 quicker (4hrs vs 5hrs if 80/20) after which I take all the revenue.

Which is a better split for me? How do I graph this? I appreciate any feedback.
Thank you.

Not really any reason to go to any great lengths about this. Suppose you work 5 hours or more a day. Under either scheme, you would 'give the owner' $100 and pocket the rest. So it doesn't really matter which scheme you use. How about those days you work 4 hours. Under the 75/25 split you get $300. Under the 80/20 split you get $320. For the sake of a good continued working relationship, I think I would forgo that additional $20. After all, if you limit the owner to the $100, you are getting an extra $25 if you work 5 hrs in a days and $75 more if you work 7 hours in a day compared to your 'old' arrangement.

 

[I_should_really_know_this]

Not really any reason to go to any great lengths about this. Suppose you work 5 hours or more a day. Under either scheme, you would 'give the owner' $100 and pocket the rest. So it doesn't really matter which scheme you use. How about those days you work 4 hours. Under the 75/25 split you get $300. Under the 80/20 split you get $320. For the sake of a good continued working relationship, I think I would forgo that additional $20. After all, if you limit the owner to the $100, you are getting an extra $25 if you work 5 hrs in a days and $75 more if you work 7 hours in a day compared to your 'old' arrangement.

Thanks Ishuda, thanks how I looked at it. It was more of a curiosity. I definitely put my work in, but his offer is very fair. I appreciate your reply.