Why do startups pay more in salary than an established competitor?

[maventiger]

Newly established businesses always want to get the best employees in the labour market. To beat established competitors, they need to offer better Pay package. Hiring a skilled labour with all necessary skill set goes a long way in helping a newly established business achieve their goals at start of the business.

Are there other ways to beat competition in hiring a skilled labour?

 

[Folaham]

Newly established businesses always want to get the best employees in the labour market. To beat established competitors, they need to offer better Pay package. Hiring a skilled labour with all necessary skill set goes a long way in helping a newly established business achieve their goals at start of the business.
Newly established businesses always want to get the best employees in the labour market. To beat established competitors, they need to offer better Pay package. Hiring a skilled labour with all necessary skill set goes a long way in helping a newly established business achieve their goals at start of the business.

Are there other ways to beat competition in hiring a skilled labour?

Most start up businesses poached their staff from established companies in same line of business and the said experienced staffs knew what they want and they go for it. If you want the best, you have to be ready to pay for it.
I left Dangote Cement (bigger establishment) for Bua cement (up coming in cement production) back in 2015 and we've closed the gap on the giant (Dangote) as at today

 

[maventiger]

Most start up businesses poached their staff from established companies in same line of business and the said experienced staffs knew what they want and they go for it. If you want the best, you have to be ready to pay for it.
I left Dangote Cement (bigger establishment) for Bua cement (up coming in cement production) back in 2015 and we've closed the gap on the giant (Dangote) as at today

@Folaham that is happens in the labour market. I keep asking myself if it is a must for startups to pay that much to hire the service of a skilled labour. Most startups do struggle in paying salaries at an early stage. Having high payroll expenses isn't something easy to maintain if the business doesn't hit the ground running.

 

[Ridorz]

For the new business established I don't think maybe it will easily to pay a experience workers but if new business want a experience workers they must be realdy to pay for it if they have a ability to pay for it. Though, it very good to hire a experience workers to business.

 

[Folaham]

@Folaham that is happens in the labour market. I keep asking myself if it is a must for startups to pay that much to hire the service of a skilled labour. Most startups do struggle in paying salaries at an early stage. Having high payroll expenses isn't something easy to maintain if the business doesn't hit the ground running.

@maventiger it is a must to hire those experience few to bring stability to their business.
Most of these companies spend multi-million dollars in setting up and acquiring equipments. These equipment needs experts to handle them as they can't just fill the whole work force with graduate trainees.
The said experienced staffs in most cases were currently underpaid on their present job and all they needed is a breakup to better their lives.

A quick example was what happened in Dangote Transport back in 2014/15 where their existing general managers (GM) and fleet managers (FM) were on monthly salaries below 500,000 Naira only for the management to bring in some sets of managers under a new name (Senior transport manager-STM, Transport manager TM) with salary packages ranging from 800,000 to 1.2million naira to do exactly what the existing FMs and GMs were doing. Most of the existing GMs and FMs were laid off while some resigned to pick up new jobs. The GMs and FMs felt cheated, used and not appreciated. The experience was an eye opener for many of them and they realised too late that they've been under paid for far too long.
Most of them are on another job earning now like the STMs and TMs.
Lastly, if a working class staff who has job security is to set out to look for another job, he will be doing so only if the pay is well above his current earnings and the new company knew that they are paying for his wealth of experience which he is to pass on to their own new and upcoming staffs

 

[Edward2]

Startups, in one way, are like any other business. You pay as much as you can for your talent. In most cases, though, startups have no way of delivering a cash bundle that is comparable with bigger businesses. This difference is compensated for by equity.

 

[Jumoke12]

Newly established businesses always want to get the best employees in the labour market. To beat established competitors, they need to offer better Pay package. Hiring a skilled labour with all necessary skill set goes a long way in helping a newly established business achieve their goals at start of the business.

Are there other ways to beat competition in hiring a skilled labour?

it's a common practice among businesses and it's one of the methods companies use to get the best employee. Also for a business to flourish, when you initially starts it is normal to sell at low price, pay higher salaries. All these are necessary to gain goodwill from people

 

[Sariana23]

The startups that are undertaking must go through a long way to succeed. If they want to emerge immediately, they must make the sacrifice of a high salary but even so, I do not think they can be a competition in this process for large companies. Therefore, they must start with adequate personnel and over time improve workers as needed

 

[IamDozzy]

This is a method used by new organizations to get the best hands in the industry. They use the high salary to try to lure them away from their current work place. An established competitor would have more than two experiences staffs working for them and they would have to pay these staff either the same or slightly higher than the other but new firms have the luxury of paying higher.

 

[Mahnoor]

Small businesses often struggle with designing a compensation strategy that is comprehensive and competitive enough to attract top talent,” says Alice Chin, founder and CEO of Your Other Half, a human resources and operations firm that helps small businesses.

Deciding where to spend finite resources can be difficult, especially for business owners who have never designed startup compensation packages before, Chin says. Here are several tips to help you figure out how to pay employees in a startup — and keep your new employees happy.

 

[Chumzy]

Startups need goo workers and will do anything to make that happen for them. They cannot afford to take any risk in form of cheap incompetent wage. But established companies are already attracting worker and investment to itself.

 

[Muhammadawais]

Startups are in every enterprise out there in one way. For the talent they need, they pay what they can. In very many cases, though, beginning do not have the resources to deliver a cash bundle that would be competitive with larger enterprises. So with equity, they offset this difference.

 

[Philip Omotayo]

The reason most of the start up salary are expensive is because they need people to do the job with total commitment. That alone would make them to be committed to the work without prejudice. The competitive outlet don't just look people with high rank, they only want OK for those they could control. And use. They alresdy have the market standard so there's no need for high salary workers.

 

[Robrown83]

It is depends on individual opinion because not all startup business that that are more salary than competitor. Most of that do these want to use it to hire most of their competitors staff so that they can gain most of their customer.

 

[Godleads1]

Start up businesses needs the best hands in order to uplift the business or make of grow. Knowing that the best hands will not come easily, the business owner therefore attracts them through good salary. The business owner designs what it takes to make a business match others within a market

 

[Dowenship]

I think they are trying to encourage there workers at early stage not to go. Probably because they both started the company together and they'v gain more experience than a newbie coming in. So they do is pay a hefty amount of money before realizing it does nt really worth it.

 

[sam386150]

Newly established businesses always want to get the best employees in the labour market. To beat established competitors, they need to offer better Pay package. Hiring a skilled labour with all necessary skill set goes a long way in helping a newly established business achieve their goals at start of the business.

Are there other ways to beat competition in hiring a skilled labour?

I think it is understandable for start-up company to pay her money to their workers than their competitors because they will try as much as possible to make their work as happy there by putting their self on a good foot in order for them to challenge their competitors in the market

 

[tyrim88]

Higher salaries are one of the strategies newer firms used to attract high skilled manpower.But what we view most times as a good bench mark for salary payment might not be the case,because for that skill you are giving out ,you are much more valued than that.

 

[Bankole]

Startup business pay much more hight than established companies because many of their staff workers especially the skilled worker are mostly the workers of the bigger companies. Some were layoff,some resign to seek more opportunities.. And for the startup business they need workers with years of experience and knowledge of the business to stand and compete

 

[Ralphjoe]

Well I think startups pay more than established companies simply because startups are trying attract good workers that have experience and so it will be difficult for this workers to leave their current jobs to work for startups so for startups to remedy this condition and situation they would have to pay or offer to pay them a higher salary than established organisations so as to attract them.