NEW YORK — With the costs of energy, supplies and raw materials rising, small business owners are naturally looking at all parts of their companies for ways to save money, including holiday spending. But many owners, believing parties, gifts and bonuses are a long-term investment in employee and customer goodwill, won’t cancel the celebrations.
“Parties do a lot for your employees in the long run,” said Mark Van Grack, owner of Hapa Sushi, a three-restaurant chain in Denver and Boulder, Colo., that has been contending with higher food costs, among other expenses. He sees parties as a way to motivate workers, and also to help them get to know each other — a step toward team-building.
Van Grack also plans to give his managers their usual holiday bonuses. His company actually awards bonuses on a monthly basis — Van Grack believes the impact of single bonus in December will be short-lived — because it is an important tool to motivate staffers.
Many companies like Van Grack’s have already budgeted or made arrangements for parties, holidays and other methods of observing the holidays. The many others who do things at the last minute are probably the ones most likely to be worrying about what feels in late November or December like an added and perhaps unnecessary expense, particularly as much higher heating bills arrive.
Don’t give in to that panic, advises Rob Wilson, president of Employco, a Chicago-based human resources firm.
“Our recommendation is to try and find a way” to have the party or give those bonuses, he said.
“Your employees are one of your most important, or maybe your most important asset,” Wilson said.
Spending on bonuses and parties will help you in two critical areas: employee retention and morale.
The same philosophy should apply to events or incentives for customers and clients. The end of the year is a time to build or reinforce your company’s relationships, and the money you spend on parties or gifts is likely to be recouped in the form of sales in the future.
“Companies have to think about, not only the short-term impact of the holiday season on their business, but the longer-term impact that those decisions have on the position of their business in the marketplace,” said John Long, a senior executive in the retail strategy practice of Accenture, the consulting firm.
Local journalism is essential.
Give directly to The Spokesman-Review's Northwest Passages community forums series -- which helps to offset the costs of several reporter and editor positions at the newspaper -- by using the easy options below. Gifts processed in this system are not tax deductible, but are predominately used to help meet the local financial requirements needed to receive national matching-grant funds.
Subscribe now to get breaking news alerts in your email inbox
Get breaking news delivered to your inbox as it happens.