Employee Appreciation: Priceless Impact That’s Not Pricey

Small business owners often have innate entrepreneurial skills, but successfully running a company requires a much larger skill set. One skill that owners should regularly practice is giving — and receiving — appropriate appreciation to and from employees.

Employees as Humans

Many business owners, as well as corporate executives, regard employees as plug-compatible units. If you don’t like an employee, “unplug it” and replace with another. This might work in some businesses, but it has a few unfortunate downsides:

  • It demoralizes your employees, which means you won’t get their best efforts
  • If reinforces your image as an unthinking, uncaring petty tyrant, or worse
  • It increases your recruiting and training costs
  • It might encourage passive aggressive behavior, if not outright sabotage
  • It wastes opportunities for business owners to develop skills that, in the long run, create a more successful and pleasant environment
  • Appreciation Isn’t Expensive

The U.S. Department of Labor says that lack of appreciation is the primary reason for employees quitting their jobs. It beat out other contenders, including salary, benefits and bonuses. If you’ve trained an employee who then quits in despair, you’ve just lost a valuable asset. That’s expensive. Compare that to the expense of a handshake, a smile and a kind word. This is a no-brainer.

Showing sincere appreciation is a skill that you can develop. The proper way to deliver praise is to be specific and enthusiastic. This means you know the employee’s name, what she did and why she deserves praise. Here’s an example of the wrong and right ways to acknowledge a great effort from Betsy:

  • Wrong: “Nice job today, Betsy”
  • Right: “The graphics on your presentation were great, Betsy”

It’s more convincing when your comment is targeted and you use the employee’s name.

Don’t Blow It

Here are a few things to keep in mind:

  •  Don’t praise mediocre performance, but don’t berate it, either
  •  Acknowledge the full team, not just its leader
  •  Don’t appear rushed or distracted when delivering appreciation
  •  Praise in public, rebuke in private
  •  Encourage your employees and your managers to be freer in acknowledging special efforts
  •  Don’t worry about overpraising, as long as it’s well-deserved

Tangible Tokens of Appreciation

Raises, promotions and bonuses are great, but they’re also annual. What can you do on the other 364 days to tangibly show your appreciation? Here are some of the most cost-effective ways to boost employee morale:

1.  Grant flex hours to those who need it. Betsy may be raising three children and might benefit from doing some work at     home. This perk provides a lot of gain without much expense.

2.  Write something for the employee’s file. We mean write, with a pen (you do remember how to use pens, don’t you?). For an extra touch, write the note on a $2 bill. We bet the employee will never spend it.

3.  Add some fun to the workweek. Maybe a weekly surprise catered lunch, or a special meeting to exchange baby pictures. Socializing adds a little spice to the job and helps keep employees motivated.

4.  Bring key customers, senior managers and suppliers into the back rooms and introduce them to employees. This works even better if you can remember your employees’ names and jobs.

5.  Dress for success. Unless an employee has to have contact with the public, encourage casual dress. Maybe not too casual, but in most circumstances a tie or stilettos may be a little much.

6.  Celebrate birthdays, weddings, and baby showers. Provide some food and let the employee leave an hour or two early.

7.  It used to be common for coffee carts to roam the office halls. We say, bring them back. One or two rounds a day of the coffee and donuts cart will send employee morale into the stratosphere. Especially if its free.

We can go on for pages, but you get the idea. Use your imagination, be sincere, and gosh darn it, have a little fun with your workers. It’s good business.

Myth vs. Fact: The Impact of Minimum Wage And Small Business

There are many myths surrounding the effects of minimum wage rules upon small businesses. Often, you’ll hear some say they “can’t afford” to pay their workers minimum wage or that customers would be happier if all employees were provided a raise in minimum wage. Fortunately, the topic has been the subject of dozens of academic studies in an effort to detect and quantify the impact of minimum wage laws. Let’s dispel some myths about this impact:

Only teens benefit from minimum wages.

False: 88 percent of those who benefit from the minimum wage and any increases in it are at least 20 years old, not teenagers looking for spending money.

 

Minimum wage laws only affect part-time workers.

False: Full-time workers make up about 53 percent of the minimum wage worker pool.

 

Increases in the federal minimum wage are automatically tied to inflation.

False: Some states have adopted this practice, but not the federal government. Some in Washington would like to adopt this rule, but the chances seem remote.

 

Young workers are exempt from the minimum wage laws.

False: The exemption for workers under 20 years old extends for only the first 90 days of consecutive employment within the year.

 

Raising minimum wage gives small business happier customers.

False: A rise in labor costs will cause job loss or the increase the price of the product/service to the customer. The business owner could take one of these measures to offset his added costs, both of these resulting in less satisfied customers, from understaffing, or increased prices.

 

Most small business owners do not support the minimum wage.

False: A 2014 survey of business owners found 60 percent support for the minimum wage. Reasons for support included an increase in consumer purchasing power, a boost to the economy, higher productivity and happier customers due to stable employees.

 

Restaurants would lose out if the minimum wage for tips was increased.

False: California has one of the highest minimum tip wages and its restaurant sales are well above average. San Francisco has one of the highest minimum wages for restaurant workers in the country, but despite (or because of) this, the city’s restaurants have had positive job growth for years.

 

If workers had higher incomes then poverty would be lowered.

False: Many minimum wage jobs are in competitive sectors of the economy, meaning these businesses are already struggling to remain viable.

 

Tipped employees are not affected by minimum wage.

False: The sum of wages and tips must equal the minimum wage. If they don’t, employers must make up the difference.

 

Minimum wage will directly affect the rise or fall of unemployment.

False: Unemployment is variable based on a variety of factors. System Dynamics Modeling (The Field of System Dynamics) suggests that our brains focus in a straight-line causation when thinking about these types of social problems. Instead of increasing the incomes of the poor through legislation, efforts should focus on stimulating demand for labor so that firms pay more by choice.

 

The federal minimum is too high by historical standards.

False: When evaluating the minimum wage over time, you must take inflation into account. Today, the minimum wage is $7.25 per hour, compared to $3.35 an hour in 1981. However, the current minimum wage would have to exceed $11 an hour to have the same buying power it did in 1981.

 

Minimum wage employees are stuck at that wage and need a legislated increase to earn a raise.

False: Research shows that the vast majority of employees who start at the minimum wage earn a raise in their first one to 12 months on the job.

 

It’s quite apparent that the minimum wage laws are good for business, good for workers and good for the economy, it’s just a tricky balancing act. It also allows us to see when minimum wage discussions arise, it is often just a cover for the actual problems at hand, stimulating employment. For this reason, we can all thank our local small business owners for doing just that.

Learn more about what IOU Financial can do for the financial challenges small business owners face on our small business loans page.

http://www.dol.gov/minwage/mythbuster.htm

http://www.forbes.com/sites/johntharvey/2014/07/06/raising-minimum-wage-not-the-answer/

10 Social Media Marketing Mistakes to Avoid

IOU Financial:

These 10 mistakes are easy to avoid as long as you know you are making them! Read through to improve your social media strategy.

Originally posted on The Writing Set:

Increase Your Following By Avoiding These BlundersUnbelievable power in the current business climate is held by social media advertising. It’s not merely a platform that hosts conversations for old acquaintances, family, and friends – it has become our central hub of advice for personal and professional use. Most folks possess an overall notion how social media works; however, few have an all-inclusive understanding of the kind of mistakes that may be made.

Check out these 10 tips to get a much better handle on your social media efforts, maintain that crowd you’ve worked so difficult to assemble, and steer clear of these blunders that are common!

10 Mistakes to Avoid

1. Failing to Post

Posting irregularly or once or two times a week generally is not enough to remain on the minds of your audience so that you’ll be their primary source in their time of need.

2. Putting…

View original 607 more words

Quick Tax Tips For Small Business

Let’s stipulate from the start that a small business should always be preparing for tax season. There should never be a time when you aren’t maintaining proper records and taking full advantage of the tax laws. When you wait until the last minute, you make the process more complicated and may discover tax benefits you let slip by in the previous year.

Nonetheless, business people are quite busy and you may find yourself only now organizing for taxes. In this article, we’ll first discuss a few general steps to take for every tax year, and then follow with specific details for 2015.

General Tax Tips

1.  Unless you are specifically trained in tax planning and preparation, hire a professional — an accountant and/or tax attorney –to help with your taxes. These worthies spend great amounts of time keeping up with the complex tax laws. A professional will often discover tax breaks, credits and deductions you might have overlooked. In fact, it’s very likely your tax savings will more than repay the cost of using a pro, which, by the way, is a tax-deductible expense.

2.  Stay informed about the latest changes to tax laws that affect small businesses. It’s a good idea to peruse the New York Times business section or the Wall Street Journal every weekday for the latest news from Congress and the courts about tax legislation — if it’s important, the papers will report it. They are available online at a quite reasonable (and deductible) price, as is the weekly magazine The Economist, our pick for the best financial periodical on the planet.

3.  Refrain from making assumptions about pending legislation. Don’t count on some tax break being passed simply because Congress is debating it. Often, a new session of Congress enacts retroactive tax laws, like extensions of expiring breaks (see below). Your tax professional will be able to advise you on the latest status of pending legislation and ways it might affect you.

4.  Identify sources of funding if you think you’ll need to pay a significant tax bill. For example, line up a commercial loan to help pay your taxes without dipping into your working capital. You don’t want to forgo inventory purchases because you need the money to pay taxes. Contact IOU Financial for full details regarding a convenient, low cost business loan.

Special Tax Concerns

There are a few important items pertaining to your 2014 tax return as well as new requirements for 2015.

Tax Extenders
Congress came through in 2014 and extended Section 179 depreciation rules, including bonus depreciation. Basically, you can immediately expense 2014 purchases of up to $500K for qualifying equipment and software. Alas, it isn’t at all clear whether these extenders will be renewed for 2015, although an important House vote is due today, Feb 4. Congress is mulling over whether to make Section 179 deductions permanent. Another provision under consideration is to cut in half the 10-year waiting period for converting a C corporation to an S. Stay posted for the latest news!

Affordable Care Act
Starting in 2015, businesses with at least 100 employees have to provide 70 percent of their full-time employees (or equivalents) with health insurance. The penalty for non-compliance is as high as $2,000 per employee. Be aware that in 2016, the minimum percentage of employees covered rises to 95 percent and the minimum number of employees drops to 50. You have to include the cost of each employee’s health coverage on Form W-2, or pay a $200 fine per employee. Consult with an accountant or insurance expert to ensure that the coverage you offer satisfies the minimum standards of the Affordable Care Act.

Online Sales
The states are eyeing online merchants as their next source of tax revenue. Although stalled in 2014, the so-called Marketplace Fairness Act will again be debated this year. If you gross more than $1 million a year from a virtual storefront, your state will want you to pay sales tax. This fight should be a doozy.