As the co-owner of a small business, I realized long ago that my company is only ever as good as the people we have in the office. There are plenty of advantages to working at a small business such as ours. An employee can easily work hard, be noticed and thrive in a small business, which is often not the case in larger, more bureaucratic corporations. Yet employees will only thrive if they feel rewarded for their hard work and take pride in what they do.
How can owners of small- to medium-sized businesses show their appreciation for their workers? We don’t have the resources to build gyms or rock walls like Google or Facebook do. We operate under a tighter budget and don’t have the ability to demonstrate our appreciation in such financially draining ways. Despite all this, a tight budget should not prevent employers from rewarding employees with extra perks for the job.
The Effect on Morale
First, let’s look at the benefits and the potential return on what should be a meager investment.
Signs of low employee morale include absenteeism, tardiness, decreased quality and productivity, increased errors and defensiveness. It’s important to recognize these signs of low morale and nip them in the bud before they cost your business valuable time and money. According to the American Psychological Association, in a study of 24 publicly traded companies, those with high morale outperformed similar companies in their same industries by almost 2.5 to 1.
How to Make It Work
Offering employee perks in the form of the following are some of the easiest and cheapest ways to boost employee morale:
- As a recognition of efforts, use credit card points to purchase gift cards at no cost.
- Set up goals that result in employees earning WFH (work from home) days or additional PTO days.
- Offer employees vacation discounts.
Let’s take this one step further and focus on rewarding success with PTO and offering vacation discounts. By doing both, you may worry about your workforce doing nothing but trying to go on their next vacation. If your employees love what they do, they won’t take advantage of these things. But really, vacationing has morale, health and productivity benefits that can have a positive effect on your bottom line.
USTravel.Org provides further support on the benefits of employees vacationing:
- Three out of four executives believe that vacations are necessary for them to prevent burnout.
- Travelers experience a 25 percent increase in performance on vigilance tests after returning from vacation – travelers 45 or older show a 50 percent increase in performance.
- And according to a study by American Express, more than one-third of small-business owners say their best ideas – the ones that lead to business growth – come not at work but during their downtime.
The benefits are clear. And I think enough of us business owners have experienced the rejuvenation of a vacation first-hand to know that the benefits to employees are real.
How Can My Small Business Offer These Things?
So, how can a small company actually carry this morale-boosting strategy out at no or very little cost? Easy – third-party programs and associations. Let the experts do the work. When you find the right third-party partner, there should really be no cost to you. They make money through sales, and for them, the more companies they get involved in their program the better.
Human resources companies like ADP offer personal discounts under their HR management program. Business associations like Smart Business Savings offer members discounts on everything from technology to travel after joining for free. And new entrepreneur communities like FoundersCard will allow you to add your employees to your discount program for a yearly fee. These are just a few examples -- there are plenty more out there. Do your research.
Or, you can choose to go the direct route. Companies like Hertz allow a business to create a Business Reward Account that will not only generate the company a unique Corporate Discount Code that will work like a loyalty code earning the company free rental days, but it may also attach a discounted rate to every rental. Anyone in the company can use the CDP code, and the more that use it the better. When your company earns free rental days, reward the hardest working employees with the vouchers – they’ll really appreciate them.
Running a small business always has its challenges. Investing in employee perks and keeping your team at their peak performance doesn’t have to be one of them.
Disclosure: The author has worked with Hertz and Smart Business Savings.
Brooke Bergman is the Co-Founder and Vice President of Allied Business Network Inc., a business membership network that offers small- and medium-sized businesses extensive discounts on the products and services that they use every day.
The Young Entrepreneur Council (YEC) is an invite-only organization comprised of the world's most promising young entrepreneurs. In partnership with Citi, YEC recently launched StartupCollective, a free virtual mentorship program that helps millions of entrepreneurs start and grow businesses.