As the Holiday Season continues, we are all out purchasing gifts for friends, family and ourselves, but have you considered purchasing gifts for your employees and customers? Showing appreciation for employee and customer loyalty is a sure way to have it continue.

One of the fastest growing gift sectors is gift cards. Gift  cards are available from just about every retailer and give you the flexibility of saying thank you in a tangible way, without being as impersonal as cash or purchasing something the recipient can’t use. Other gift cards such as Visa’s Giftcard, can be used anywhere Visa debit cards are accepted, which allows you the chance to give the perfect gift everytime.

Many of the gift card vendors will allow you to upload your own images to be placed on the giftcard and others offer co-branding of your logo onto their card along with a message to the recipient. As an employee gift, placing a special message and/or their name on the gift card, shows a relationship that says you know who they are and appreciate what they do.

For your customers, it is an acknowledgement of all they do for your business and an invitation to continue doing business with you. Additionally, if you use a branded card, every time your customer uses the gift card, they and the retailer see your name and logo, which is very valuable in market penetration and exposure.

There is no debating the competition for your customer’s loyalty and money. Every effort you make to establish a relationship with your customer base, the greater the chance of retention and expanion. The same is true for employees, the days of working for one company until retirement have long passed. Employees are willing to change companies until they find one that gives them the job satisfaction they feel they deserve. In a study done by Northwestern University, 55% of respondents agreed their job performance was directly affected by how they felt they were treated.

If you did not budget for gifts this year, make sure you add it to next year’s budget and come back and let me know how it was received.

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There have been many discussions on the pros and cons of outsourcing and there are as many for, as against. As a business consultant I understand how the need to reduce costs and increase revenue can be a factor in the decision to subcontract services to a vendor with lower fees, but do you have to be a large company to gain those benefits?

One of my clients was in the inital stages of opening a business. He had a product that was unique, affordable and in demand, but did not have a budget to produce marketing collateral and establish a new business. With a budget of less than $1,000 we were able to have a website built, incorporate the business, design a logo, print business cards, flyers, and  CDs. How was this possible? By using contractors found on the Internet, the business owner was able to work with small business people like himself from all around the world. The contractors were looking for an opportunity to build their client base and he was looking for a inexpensive way to let the world know he was opening for business. As a result of these relationships,  my client offers their services to his customers and now a document services company can offer print services, web design, logo building and business card printing.

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Two of the most pressing concerns for companies today are reducing employee turnover and improving productivity because they both impact the bottom line. The cost of turnover may be as much as one and a half times an employee’s first year salary. In addition, unproductive employees can change a company’s organizational culture from one of satisfaction to one of discontent. An efffective employee recognition program greatly reduces these issues.

How does not having a recognition program affect your business?

A recent Maritz Incentives poll of 1,002 participants, found 55 percent of employees agree or strongly agree that the quality of their company’s recognition efforts impacts their job performance. At the same time, only 10 percent of employees strongly agree that they are completely satisfied with their company’s recognition efforts.

Many of us have had jobs where we’ve felt unappreciated, but in today’s competitve market this sentiment can cripple a business and reduce employee morale and job satisfaction. The result of this is a decrease in productivity, inattentive customer service and diminished repeat business.

So what should an Employer do?

The first stage of instituting an employee recognition program is a change in the organizational culture. Upper management and all supervisory positions must believe in the validity of rewarding employees for meeting and exceeding company goals and objectives. They must encourage employees to seek the rewards and coach them on behaviors that will help them attain those levels.

Secondly, the goals must be attainable. This is not to say the goals can’t be challenging, but having employee see others enjoy the benefits of hard work, only encourages like behavior.

Use group incentives to reward teamwork and communication among groups that work within a process. For example, if a Plant Manager gives a reward based on overall cleanliness and the third shift does not perform to the same level as the others, there is no doubt the Shift Managers of the first and second will meet with the third Shift Manager to offer suggestions and motivation.

Finally, keep the your incentives fresh. Vary the types of rewards and the frequency, but be consistent in the level of excellence required to achieve them. If a certain action always brings the same reward, it can quickly become "not worth it" or "I dont need another Target  giftcard". Find out what is meaningful to your employees and make sure you reward on all levels of your business hierarchy.

An employee recognition program may seem expensive and laborious, but the return on investment can be tremendous. Employees who are satisfied with their company’s recognition/rewards program are far more likely to spend the remainder of their career with the same company, recommend other great people to work for the company, invest in the company, and increase the company’s bottom line. 

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As the cost of filling up continues to reach the point of true pain, we have to wonder what collateral damage will be done to businesses. Many of the nation’s large retailers such as WalMart, Marshalls, and Target rely on lower prices and high volume to drive their business. Increased fuel costs forces consumers to  make choices on how their discretionary income will be spent. Expenditures that were seen as simple pleasures such as movies, dining out and shopping, will be post poned if not eliminated.  When you consider WalMart operates on a 3% margin of profit, you can only imagine the strain any reduction in spending will have.

What will the small businesses do to survive?

Small businesses that have worked hard to gain accounts with the large retailers will undoubtedly come under pressure to reduce prices or offer incentives in order to keep their accounts. If that was not problem enough, larger competitors will begin to approach their accounts offering reduced pricing. This impending and seemingly unavoidable scenario will present a challenge to the savviest business owner. How do you maintain competitiveness while not passing on the rise in cost of materials and transportation due to the increase in gas prices? The simple solution….technology.  Technology is one sure way of increasing productivity, profitability and marketability in a short period of time and without great expense to the consumers. The implementation of the proper technologies will be the result of process analysis and business strategies. The small business owner can gain profitability not by lowering expenses, but increasing the efficiency of the entire business process.

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