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Paying Members outside of my Country


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#1 afliii   Members   -  Reputation: 464

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Posted 03 August 2012 - 09:49 PM

As mentioned in the past two posts by me, I lead Broken Limits Media LLC (BLM). I have not promised employment, compensation, nor any payment to any of my members. They understand that as of right now BLM is a portfolio building group. We make games, we get our reputation out there, and we beef up our portfolio as a team.

My hopes are that we actually generate some revenue from our next project, which may actually be a contracted game. However, I have two members who live outside of my country, both in seperate countries. What do I do when/if it comes time to pay them their fair share? I assume I would convert the currency, but doesn't the fact that some contries are richer than others and some are not as wealthy make a difference in the amount of USD the other members are worth? It might be better rephrased: If a member of my team is in another country, how do I measure the value of their works in their currency vs if they worked for USD in America, and what/how do I pay them? Is that more complicated or less? =/

Example: "Ron" lives in "Norron," where he studies art and works for the American company, BLM. Ron's country does not have a ton of artists, so the value of skilled artists goes up. Right? Right... So when BLM pays an American employee $100 USD and Ron's work is worth $150 USD in his country, he gets angry. Is this scenario accurate, and should it be a concern for me, the business owner and the one who may have to pay more or less? Should I just pay everyone $X USD based on their performance by American standards, no matter where they live?

I feel like I can answer this a number of different ways, but I'm not 100% sure which one is the best and most ethical option.

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#2 Tom Sloper   Moderators   -  Reputation: 9450

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Posted 03 August 2012 - 10:30 PM

Should I just pay everyone $X USD based on their performance by American standards, no matter where they live?


No. Don't pay everyone exactly the same amount. Negotiate each staffer's compensation on an individual basis. You can also set up a pay scale standard for your company, and adjust them based on current standards of living on a country-by-country basis. But even with a pay scale standard, you'll still have varying compensations for equivalent jobs and equivalent experience levels.
Negotiate.
-- Tom Sloper
Sloperama Productions
Making games fun and getting them done.
www.sloperama.com

Please do not PM me. My email address is easy to find, but note that I do not give private advice.

#3 afliii   Members   -  Reputation: 464

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Posted 04 August 2012 - 05:19 AM

Excellent advice. Thank you.

#4 anttoo   Members   -  Reputation: 206

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Posted 04 August 2012 - 12:14 PM

As mentioned in the past two posts by me, I lead Broken Limits Media LLC (BLM). I have not promised employment, compensation, nor any payment to any of my members. They understand that as of right now BLM is a portfolio building group. We make games, we get our reputation out there, and we beef up our portfolio as a team.

My hopes are that we actually generate some revenue from our next project, which may actually be a contracted game. However, I have two members who live outside of my country, both in seperate countries. What do I do when/if it comes time to pay them their fair share? I assume I would convert the currency, but doesn't the fact that some contries are richer than others and some are not as wealthy make a difference in the amount of USD the other members are worth? It might be better rephrased: If a member of my team is in another country, how do I measure the value of their works in their currency vs if they worked for USD in America, and what/how do I pay them? Is that more complicated or less? =/

Example: "Ron" lives in "Norron," where he studies art and works for the American company, BLM. Ron's country does not have a ton of artists, so the value of skilled artists goes up. Right? Right... So when BLM pays an American employee $100 USD and Ron's work is worth $150 USD in his country, he gets angry. Is this scenario accurate, and should it be a concern for me, the business owner and the one who may have to pay more or less? Should I just pay everyone $X USD based on their performance by American standards, no matter where they live?

I feel like I can answer this a number of different ways, but I'm not 100% sure which one is the best and most ethical option.


You don't seem to be particularly business savy.

You should be attempting to minimise every single cost if you want to have a real revenue generating venture. So what if he is 'angry', is he going to do the work? If no, increase his salary or call his bluff? You sound like you need to talk to someone who runs a business.

If you are negotiating pay after nearly completing your project, you are screwed. A single person who is unhappy could pull the plug on the entire venture claiming they own the Intellectual property rights.

"USD the other members are worth" - wrong way of looking at it. This is the basic formulae: "How much they can produce" - "Min amount they will work for" = "profit" . You need to be thinking in these terms or else you are not running a business.

If I were you, I would fist off write a basic business plan! Decide if you are going to run a business or a hobby?

If you want a business, do this: Calculate the number of man hours you will use, make a low prediction of expected revenue. Minus expenses. Divide these, and consider if your hourly rate is better than a McDonalds job. It most likely isn't.

Basicly, you need a business plan.

I whipped this up:

Sales
Unit price 10.99
Sold copies 2000
Dist costs 7325.934
Total 14654.066
VAT 2930.8132
Total-Vat 11723.2528

Production costs
Man hours 2184
Wage 10
Cost 21840

Profit -10116.7472

So if you are paying $10 an hour, to six guys, who do 1 hour a day for a year and sell 2000 copies. you make a 10k loss.

You would have to sell 4000 to break even. At 6000 you make $12k profit. Can you really sell 6000? And is $12k a year a good salary?

Perhaps pay $5 an hour? Would you work for that though? Are you going to attract talent?

Do you have a business plan? I don't mind taking a look over it if you want some business advice.

#5 afliii   Members   -  Reputation: 464

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Posted 17 December 2012 - 01:01 PM


As mentioned in the past two posts by me, I lead Broken Limits Media LLC (BLM). I have not promised employment, compensation, nor any payment to any of my members. They understand that as of right now BLM is a portfolio building group. We make games, we get our reputation out there, and we beef up our portfolio as a team.

My hopes are that we actually generate some revenue from our next project, which may actually be a contracted game. However, I have two members who live outside of my country, both in seperate countries. What do I do when/if it comes time to pay them their fair share? I assume I would convert the currency, but doesn't the fact that some contries are richer than others and some are not as wealthy make a difference in the amount of USD the other members are worth? It might be better rephrased: If a member of my team is in another country, how do I measure the value of their works in their currency vs if they worked for USD in America, and what/how do I pay them? Is that more complicated or less? =/

Example: "Ron" lives in "Norron," where he studies art and works for the American company, BLM. Ron's country does not have a ton of artists, so the value of skilled artists goes up. Right? Right... So when BLM pays an American employee $100 USD and Ron's work is worth $150 USD in his country, he gets angry. Is this scenario accurate, and should it be a concern for me, the business owner and the one who may have to pay more or less? Should I just pay everyone $X USD based on their performance by American standards, no matter where they live?

I feel like I can answer this a number of different ways, but I'm not 100% sure which one is the best and most ethical option.


You don't seem to be particularly business savy.

You should be attempting to minimise every single cost if you want to have a real revenue generating venture. So what if he is 'angry', is he going to do the work? If no, increase his salary or call his bluff? You sound like you need to talk to someone who runs a business.

If you are negotiating pay after nearly completing your project, you are screwed. A single person who is unhappy could pull the plug on the entire venture claiming they own the Intellectual property rights.

"USD the other members are worth" - wrong way of looking at it. This is the basic formulae: "How much they can produce" - "Min amount they will work for" = "profit" . You need to be thinking in these terms or else you are not running a business.

If I were you, I would fist off write a basic business plan! Decide if you are going to run a business or a hobby?

If you want a business, do this: Calculate the number of man hours you will use, make a low prediction of expected revenue. Minus expenses. Divide these, and consider if your hourly rate is better than a McDonalds job. It most likely isn't.

Basicly, you need a business plan.

I whipped this up:

Sales
Unit price 10.99
Sold copies 2000
Dist costs 7325.934
Total 14654.066
VAT 2930.8132
Total-Vat 11723.2528

Production costs
Man hours 2184
Wage 10
Cost 21840

Profit -10116.7472

So if you are paying $10 an hour, to six guys, who do 1 hour a day for a year and sell 2000 copies. you make a 10k loss.

You would have to sell 4000 to break even. At 6000 you make $12k profit. Can you really sell 6000? And is $12k a year a good salary?

Perhaps pay $5 an hour? Would you work for that though? Are you going to attract talent?

Do you have a business plan? I don't mind taking a look over it if you want some business advice.


Yea man. Thanks for the input. I only just realized it was posted. Sorry.

But yea. I've made a lot of changes now. We're going to sign for royalties. Not hourly wages. They're ok with that and so am I. Safe bet for everyone I think. They're all students so building portfolios and working for a higher royalty amount is fine for them. They love the way we operate too. I've had a few of them tell me that they prefer my leadership over some other, well established groups they've been on so hey, hope we can build a great game together. I think we can!

#6 Tom Sloper   Moderators   -  Reputation: 9450

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Posted 17 December 2012 - 04:31 PM

We're going to sign for royalties. Not hourly wages. They're ok with that and so am I. Safe bet for everyone I think.


I disagree that it's safe for the other people. Even if you have a solid business plan for making money from the game. They should be paid for work provided, if the game is a money-making venture.
-- Tom Sloper
Sloperama Productions
Making games fun and getting them done.
www.sloperama.com

Please do not PM me. My email address is easy to find, but note that I do not give private advice.




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