As holiday songs begin in earnest on the radio, and people begin hanging Christmas lights, now is the time for small business owners to take advantage of the many benefits provided by working capital loans. Although owners can use this capital for any number of reasons, from investing in new technology or launching a new marketing campaign, a great option for this time of year is putting the money toward year-end holiday bonuses for your employees.
Good economic environment for bonuses
A recent Bank of America Small Business Owner Report for Fall 2015 discovered owners are generally quite confident in their prospects for the upcoming holiday shopping season, with 56 percent of respondents believing the national economy will continue to get better. This marks an 11-point increase over the 45 percent of respondents who were confident in the economy last year.
While business owners are expecting promising economic head winds in the next couple months, now would be a good time to show employees their work is appreciated by offering them year-end bonuses. The practice of monetarily rewarding employees with bonuses went out of fashion following the financial crisis of 2009, as many companies were unable to find the extra resources for these presents.
However, as the economy continues to grow, many owners have rediscovered the benefits of providing bonuses. Last year, the American Express OPEN Small Business Holiday Monitor found that 42 percent of small business owners intended on rewarding their employees with year-end bonuses, nearly doubling the 27 percent of respondents who planned on doing so in 2013. Due to the strengthening economy and the improving business owner confidence, the trend toward offering bonuses is only expected to expand.
According to a survey conducted Express Employment Professionals, 27 percent of employees cited cash bonus as the No. 1 way they wished their company showed them appreciation. Cash bonuses beat out such other options as pay raises at 13 percent, days off at 9 percent and gift cards at 5 percent. While it might seem easy enough for owners to simply dismiss this as merely employees seeking handouts, there are many reasons why keeping employees happy and providing bonuses also benefit the business.
The myriad benefits of bonuses
As companies struggle to handle the surge in customers during this busy time of the year, the team members who end up dealing with the influx are the employees. Customer-facing positions can be extremely difficult during the hectic shopping season, as mothers trying to find that perfect gift for their children become impatient, or a girlfriend seeking out the best deal for her boyfriend gets irate over an unclear advertisement. Employees will need to calm down these individuals and still attempt to close a sale.
The immediate work with clients is only one reason why employees should receive bonuses, since, after all, staff members must deal with these types of problems all year round. Rewarding employees with a year-end bonus not only puts a little something extra in their pocket, but it also demonstrates you appreciate their efforts. This sign of appreciation goes a long way toward building manager-employee relationship, improving employee performance and, ultimately, creating a more pleasant work environment. When people are thanked, they are much more willing to go the extra step to guarantee they’re working as hard as possible and to the highest possible standards. Without this kind gesture, employees can form resentment toward the company, leading to a lull in the quality of their work, or a detached mentality.