Looking Toward the Christmas Bonus

As we barrel into the Christmas season, many small business owners are thinking about the annual Holiday Bonus. Owners want to let their employees know that their hard work is appreciated, and workers look forward to having that extra cash to spend on their family during the holidays.

The first recorded Christmas Bonus was given out by Woolworth’s in 1899. Each employee received a $5 bonus for each year of service, up to a maximum of $25.

So what is a small business owner’s typical bonus? For some it could be nothing more than an office party with food, drink, and small gifts…even gift exchanges (which cost each individual employee more and misses the entire message of “you’re appreciated”! )  While there’s no standard rate for performance bonuses, surveys report a range from 1% to 10% of an employee’s annual salary when goals are met. Of course, executive bonuses may be much higher.

Your profits vary from year to year in line with the rate of inflation and whether it’s been a lean or lucrative year. If a company has paid cash benefits in the past, then employees may be expecting and counting on a Christmas bonus to pay for their own holiday expenses and family gifts.

If this year was more profitable than last, then it is time to show your appreciation. Employees, by far, prefer receiving cash bonuses, but if your’e a lean startup or coming off a difficult period, there are other ways to show your appreciation for their loyalty. 

At the annual Christmas party, be sure employees understand that this party is in appreciation for them! During the party, recognize each person individually with a compliment and sincere thank you. If appropriate, it’s a good time to announce new job titles or that “John” or “Jane” will now have extra responsibility because of their past performance. Announce new learning opportunities for the coming year that could lead to pay raises. Or give the second most appreciated gift, paid time off, even if it’s just a day.

The post-Covid year of 2022 has seen the so-called “great resignation” with many people quitting their job to start their own business or to change employers and even careers. Plan now how you can show your appreciation this holiday season, whether or not it be a financial one.

Footnote: For more ideas, we suggest reading 12 purpose-filled alternatives to the Christmas bonus from Management 3.0.

Small Business Holiday Celebrations

December launches the happiest (or most stress-filled?) time of the year for small business. Regardless of which holiday your employees celebrate—Christmas, Hanukkah, or perhaps another, it’s a festive time for office decorating and party planning. Expressing appreciation during the holidays contributes to a fun, cohesive work culture, especially for those offices that were forced to adapt to working remotely during the Covid pandemic. 

Even if you simply celebrate the season without consideration for tradition, your employees will notice the effort and enjoy the camaraderie. Employee gifts are always appreciated, whether it be in the form of individual tokens like a small gift, office party with food, or a long lunch hour at a local restaurant. If you plan to give employees a Christmas or end-of-the year bonus, now is the time to confirm that funds were included in the annual budget.

A recent survey indicated that only 41.5% of small businesses plan to give a holiday bonus this year “if they can afford it.” So many are looking for alternative ways to inspire employees and make the season special.

Decorating the office and being creative are good places to start. More suggestions include holding a Christmas sweater contest, Christmas cookie bake-off, or hosting a catered lunch, potluck, or no-fuss restaurant luncheon. What might be the best motivational idea of all? Volunteering for a non-profit organization or having an office party where, instead of a gift exchange among employees, have everyone bring a backpack full of school supplies, or another item that is relevant to the charity that the gift exchange will support. Giving back is a winning way to bring your team together and still have fun. Plus, it’s a great PR opportunity for your business. Ideas might also include selecting a charity to help raise funds, working in a soup kitchen, or collecting donations for a toys, food, or clothing drive.

If you manufacture a product or provide a service that has general appeal to consumers, offer it to a nonprofit as an auction item. 

The important thing to remember is that it’s been a tough couple of years. It’s time for good cheer and holiday celebrating. What’s your idea this year? Let us know.

Winding Down 2020

Thanksgiving morning, kids across America rushed to find a comfy spot in front of their television sets. Armed with steaming cups of hot cocoa, they settled in to watch the annual pageantry of the Macy’s Thanksgiving Parade with its bands, clowns, music, balloons and huge floats. Screech! Not so fast. It’s 2020. No crowds, no onlookers, and no people were allowed to attend the Covid version of this year’s reimagined parade.

America isn’t particularly happy this year. According to a study, Ohio ranks in the middle of the road for happiness. Out of 50 states, we rank as the 35th happiest state based on our overall well-being and satisfaction with life based on work (41), emotional (32), and community/environment (25). Overall, Hawaii is the happiest and West Virginia the unhappiest. About work, Utah is the happiest and Louisiana is the least happy.

As Ohioans, we are coping with the State’s social gathering orders set by Governor DeWine but some of us are also feeling a bit worn down both emotionally and physically. 

So as we barrel towards a socially-distanced Christmas season and New Year, let’s celebrate with hope and resilience. We may find ourselves reconsidering who we are and what we value; and perhaps, it might even help us to discover a better version of our pre-Covid selves.

As we at DLMoneyMatters move towards an end to 2020 with Thanksgiving and Christmas and Covid vaccines on our mind, we want to give a heartfelt “thank you” to those small businesses who trust us to do their accounting and bookkeeping, and also to the families who trust us to handle their daily money management needs. Thank you for helping us grow our accounting and bookkeeping side of the house, and for giving us the opportunity to make a difference in your success.