If you've ever seen or read anything about Google's (Nasdaq: GOOG ) headquarters, you've likely been in awe over the beanbag chairs, laundry service, and all-you-can-eat gourmet buffets.Employees at Genentech (NYSE: DNA ) will likely boast of the company's doggie day care and on-site farmers' market. Starbucks (Nasdaq: SBUX ) made headlines providing employees working at least 20 hours per week with health-care coverage. At Goldman Sachs (NYSE: GS ) , the perks are a bit more direct: The average employee bonus came in at more than $600,000 last year.
But one up-and-coming company takes a completely different view. How does it find the best employees around? It doesn't shower them with gifts. It simply pays them to quit.
Sign me up
Online retailer Zappos.com's innovative way to filter out subpar employees might seem completely backwards at first. When new employees start working, it makes them an offer: Quit today, and we'll pay you for the time you've worked, plus $1,000 to boot.
That's right:
- Get hired.
- Come to work.
- Tell your boss you've had enough.
- Collect $1,000.
- Walk away snickering.
What's the catch? Nothing. Zappos is simply calling your bluff.
I don't get it
Zappos has a pretty unique business model: Customers shop its collection of shoes and apparel online, get shipped the merchandise for free, and if they aren't satisfied, they ship it back -- for free as well. Most of the time, the products are shipped overnight, for free. I can speak from experience -- the service is pretty phenomenal.
Shiny happy people holding hands
Management is whoopty-woo about generating a positive employee culture, since so much of Zappos' success relies on top-notch customer service. In order to succeed, it has to be home to employees who really want to be there, not just those zeroed in on a paycheck. If $1,000 is more important to you than devoting yourself to the company, good riddance. You probably would have been a drag in the first place. What looks like an offer too good to be true might actually seem like an insult if accepted -- it's essentially an admission that you're not devoted or ambitious enough to keep up with your colleagues.
Since it's a private company, we don't have access to its books. But I'm willing to bet with all that free shipping back and forth, margins are pretty slim. With little room for error, it has to do business in volume, much in the way Costco (Nasdaq: COST ) found success. Since selling shoes and sweatpants online is about as commoditized as it gets, Zappos has to cling to the one thing that sets it apart: incredible customer service. The way it ensures that? Lure anyone who might be even slightly disgruntled out the door.
The obvious question remains: How many people are taking advantage of the offer by applying with no intention of sticking around? Undoubtedly some, but from the company's actions, you wouldn't know it. The quit incentive originally started at $100, and management has hinted it could go even higher than the current "free g" offered if the company gets bigger.
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