The Fit Stop Ltd$.$ is a new firm that will open its doors exactly four months from today. Itsbusiness objective is to sell all types of training, fitness, conditioning, and exerciseequipment to the general public. The Fit Stop plans to specialize in this equipment and toprovide customers with personalized advice geared to a customer$$s specific training orconditioning needs $($e$.$g$.,$ training for a particular sport, injury rehabilitation, strengtheningof muscles to deal with back pain, general conditioning, and fitness$),$ whether thecustomer is $9$ or $90$ years of age.In order to provide high$-$quality advice, each store will employ a physiotherapist $($toprovide advice on problems such as injuries or chronic back pain$)$ and a person with abachelor$$s degree in kinesiology $($to provide advice on training for various sports or otherphysical activities$)$ and a nutritionist to create a diet and eating plan that matches theathletes exercise plan. A staff member will even sit down with customers and develop apersonalized training or conditioning program that meets their own specific objectivesand needs, at no cost to the customer.The remainder of the staff in the store will consist of a manager, with a BusinessDiploma, and sales staff, who will have at least high school diplomas. Due to the longopening hours, it is expected that between $812$ salespeople will be needed for eachstore. Because the stores are located in shopping malls, they will operate on a seven$-$day$-$a$-$week basis, open $9$:$009$:$00$ weekdays, $9$:$006$:$00$ Saturdays, and noon to $6$:$00$ onSundays.Aside from personally helping customers, the roles of the physiotherapist andkinesiologist will be to train other employees in how each type of equipment can be usedfor various conditioning and rehabilitation purposes. Initially, sales staff will be givengeneral training, but as time goes by$,$ each salesperson will be expected to learn in depthabout all the different pieces of equipment, to help customers diagnose their needsaccurately, and to be able to explain proper use of the equipment. Because of the highlevel of training required, all employees will be full$-$time.

The founder of the business is Susan Superfit, who has undergraduate degrees inkinesiology and commerce from the University of Alberta. While at university, sheparticipated in many sports $($and suffered many injuries due to her all$-$out style of play$).$She came up with the idea for this business while laid up with one of her injuries. Whilethere were businesses that sold fitness and conditioning equipment, she often found thatthe people selling it had very limited knowledge and often gave poor advice on what tobuy and how to use it$.$She has secured funding from private investors and from Growthworks, a largeCanadian labour$-$sponsored investment fund. To receive volume discounts on theequipment she will be purchasing and to beat competitors into the market, she wants tostart off quite large, with stores in major cities in Ontario and the four western provinces,before expanding to Quebec and the Atlantic provinces. She knows that this is a riskystrategy, and that cost control will be essential to keep the business going long enoughto become well known and develop a stable clientele. She does not expect the businessto make a profit for at least two years.Her main competitor will be sporting goods megastores that sells some of the sameequipment. Some of these outlets will be able to price their equipment lower than The FitStop will be able to$,$ but none have the range of equipment that The Fit Stop will have,and none provide the personalized services that The Fit Stop will.Susan believes that the key to her business success will be highly motivated andknowledgeable employees who have a strong concern for their customers and who areable to work as a team with the other employees to provide the best possible customerservice. Because no two customers are exactly alike, employees will have to beinnovative in developing solutions that fit their needs. It will also be crucial to keep upwith the latest fitness, training, and food trends, as knowledge about fitness is continuallyincreasing, along with new and different types of specialized equipment. A key aspect ofcompany strategy is to be the most up$-$to$-$date and advanced supplier of new productsand techniques.Although Susan has given a lot of thought to her business, one thing she hasn$$t reallygiven much thought to is how to compensate her employees. Because she doesn$$t really

know much about compensation, she tends to feel that the safest thing would be to justdo what her competitors are doing.The CEO Susan Superfit has hired you to formulate a compensation strategy, anorganizational pay plan, and a benefits system for her firm. She wants you to completethe project by developing a detailed plan for implementing the new compensationsystem.