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Getting Workers Back to Work

I have taken this phrase, "Investing in Your People First" from an article I recently came across that was particularly provocative and enlightening ( For a while now, I have been contemplating how best to write about raising wages to attract more workers as we all try to positively navigate our way out of this pandemic.

Many small business owners are afraid that increasing employee wages will hurt their profits, short and long term. However, despite the hesitation among lawmakers, the reality is that many small businesses have already increased wages to $15.00 per hour to attract much needed employees. I have seen many small businesses successfully implement this because they were innovative and willing to “think outside the box”. The reality is that your employees are your main asset – they are the ones who do the following.

a) They give great service to your restaurant or bar customers, which leads to positive reviews, repeat clientele, and higher revenue.

b) They are willing to work more efficiently and productively if they feel their contributions are recognized and appreciated.

c) They will promote your business outside of work if they are happy and well taken care of (not just monetarily, but also with gratitude).

Many of the small business owners who took part in this article cited increasing revenue due to repeat customers who initially had a very positive first experience. This type of advertisement cannot be bought, regardless of how much you spend on marketing. Word of mouth is the best marketing tool you have and happy, appreciated employees are your best marketers.

So, what can the business owner do to counter the increased payroll costs? It may take some time to come up with innovative ideas that fit your business specifically, but we have a few thoughts on how you can get started.

a) Increase the hourly rate, and stagger/reduce employee’s hours. If you reduce the hours worked at a lesser rate than the increase in pay, the employee is still bringing home a healthier paycheck, but your additional employee costs are not increasing in tandem with the increase in pay, thus not hurting your bottom line too much.

b) Add incentives for your work staff – for example, set up a bonus program for employees who bring in new customers. Set a timeline for the bonus, perhaps 5 new customers a month equates to a monetary bonus, gift card of their choice, etc.

c) Increase your revenue – One of the entrepreneurs interviewed in the article said, “…the best way to save money is to make more, just have a better top line. The way you do that is by investing in your people first.”

d) Increase your prices – given the current environment and the supply chain issues so many industries are facing, raising prices slightly (anywhere from 2-10%) will offset your increased employee pay, and most customers will accept the increase, particularly as we are just beginning to recover.

Remember, running a successful, profitable small business is a long-term endeavor, so if you are willing to adjust in the short term for positive long term growth, you are running your business well.

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