When it comes to thanking your employees, a little appreciation goes a long way. From bonuses to holiday parties, presenting your employees with the occasional token of your appreciation not only helps keep them motivated, but in some instances, can even provide them with an additional incentive to work even harder. However, with so many different ways to express your gratitude, how do you decide which option is right for the current size and culture of your small business? In episode #87, Gene Marks and Elizabeth Larkin discuss the most appropriate ways to thank your employees.
0:34—Today’s Topic: How Do You Thank Your Employees?
0:40—When planning a holiday party or social event, make sure it involves activities that all your employees will enjoy.
2:10—If you decide to present your employees with actual gifts, take care to select items that will suit both their individual needs and personal tastes.
2:44—Fully paid vacation accommodations and gift cards make great rewards since your employees can enjoy these with their loved ones.
9:39—Offering a bonus at the end of the year gives your employees the freedom to choose how they want to spend it.
9:42—Simple gestures, such as a handwritten note, will also be greatly appreciated.
12:50—Profit-sharing plans are the employee ideal gift because of their long-term value.
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Elizabeth: Gene, last episode, we talked about how you think your clients, or your customers, at this time of the year. If you should, if you shouldn’t, what you do send to them if you decide to thank them. Today we’re gonna talk about thanking your employees.
Elizabeth: So, typically, places that I’ve worked before, you have a holiday party, and in my … In the past four years, I think my group has been ice skating.
Elizabeth: Which was not very popular.
Gene: I was just gonna say. How did that work out?
Elizabeth: There were five of us that really enjoyed that.
Elizabeth: And everyone else was horrified of hurting themselves.
Elizabeth: Bowling, which was actually a pretty big hit because-
Gene: I’m a fan of bowling.
Elizabeth: Yeah, you’re either a good bowler, so you enjoy it, or you’re a bad bowler, and there’s beer-
Gene: As long as there’s a-
Elizabeth: So it’s-
Gene: As long as there’s beer. I was just gonna say. There’s a bar nearby, then that’s fine.
Elizabeth: It’s fine.
Elizabeth: And then, what did we do last year? Oh, we went to a Mexican restaurant and we played a Family Feud-style game.
Gene: That sounds horrible. So in other words you guys do-
Elizabeth: But you really, honestly, it would’ve been your worst nightmare.
Gene: It sounds like a nightmare. I would-
Elizabeth: It’s really-
Gene: You work with these people all day and now-
Gene: You’re forced to go out and then play a game with them.
Elizabeth: You know who really enjoyed themselves?
Gene: I’d kill myself. Who?
Elizabeth: And we will throw his name out there because he is a podcast listener, is my manager, Dave O’Brien.
Gene: He enjoyed that?
Elizabeth: He loved … He was the Richard Dawson character.
Gene: Okay, yeah.
Elizabeth: He was the ringleader.
Gene: And here I was. I was, up into this moment, liking that guy. And now, suddenly my respect for him has just been diminished. So you-
Elizabeth: But the good thing is-
Gene: At The Hartford, the way that you guys sort of pay back your groups is-
Elizabeth: Yeah. You have a party-
Gene: You go somewhere, you have a party.
Elizabeth: Yeah, and it was great. We had it at a Mexican restaurant-
Elizabeth: So the food was fantastic.
Elizabeth: And it was really fun. And then I think we … some of us stayed out until much later-
Gene: Crazy. Okay.
Elizabeth: On a weeknight. But it was really fun. But I know some companies … When I worked at a bank, we actually … I got gifts from my managers.
Gene: Right. Right.
Elizabeth: Which I always think is so awkward.
Gene: Yeah, yeah, yeah. Because you don’t know what to buy and-
Gene: There’s so much room for error-
Gene: When you’re buying people gifts. We give cash and we give … I actually, but no, I’m gonna tell you in a different format. We have three things that I do-
Gene: With our people and our company, and I’ve learned this from other clients. So here’s some ideas for you if you’re running a business and you’re looking to give sort of gifts to your employees or whatnot. Okay, so number one is, I personally own a timeshare, have I ever told you this? We own a-
Elizabeth: Yeah, I think so.
Gene: Timeshare. It’s in Hawaii.
Elizabeth: Oh, nice.
Gene: It’s in Mauna Loa, Hawaii.
Elizabeth: I’m surprised you do because everyone always says timeshares are the worst investment ever.
Gene: Okay, so first of all, we’ve never been to this timeshare. We’ve owned it for twelve years. For all I know, it’s under a foot of lava, but it’s … but we’ve owned it, and you have it. We bought it for 5,000 bucks 12 years ago.
Gene: We had high aspirations to use it for our family.
Elizabeth: You’ve never gone?
Gene: Never been there. But here’s what we do, here’s what I’ve been doing every year. It’s part of our CI network. These timeshares are all connected to these-
Gene: Exchange networks, of course. And I say this is a good idea for a business owner. If you were to buy a timeshare, and they cost anywhere from three to ten thousand dollars for these ones.
Gene: We, every year, we trade it in on our CI. We have a week in Hawaii. We trade it in for either a week in Vegas or a week in Orlando, and every year, I give it away. I give it away to one of our employees. Some years I’ve given it away-
Elizabeth: Why don’t you give them a week in Hawaii?
Gene: Well, just hold on. I’ll tell you why in a minute, but we’ll … We’ve … A few years we’ve given them to an employee-
Elizabeth: How wants to go to Orlando or Vegas when you could go to Hawaii?
Gene: Just, listen. Hold on. You don’t have kids. This is like a big deal. So you either go to-
Elizabeth: You take your kids to Vegas?
Gene: No, that’s why you have Orlando. That’s why you just … So you won’t let me finish, though. So, sometimes, some years we’ve-
Elizabeth: Well because your kids are in their 20s, you might take them to Vegas.
Gene: Oh, my goodness. Yes.
Elizabeth: Alright, sorry, go on.
Gene: We’ve given this to customers, we’ve given this to our employees, and we’ve given it to charities, by the way.
Gene: So I’ve kind of mixed it up or whatever. But it’s a full week and you get these timeshares. These resorts are gorgeous, and they’re two-bedroom suites in the vicinity. And then, of course, people have to pay for their own plane fare, but it’s a week.
Gene: They give you a week, Elizabeth, in Vegas. You know what I mean?
Elizabeth: That’s really nice, yeah.
Gene: That’s like kind of cool to go to.
Elizabeth: That’s way too much time in Vegas. Way too much time there.
Gene: Share it or whatever. So that’s one thing that we’ve done.
Gene: And that’s usually if we ever run, sort of, and that’s another conversation. Sort of contest with our employees or.
Elizabeth: Yeah, yeah, yeah. Let’s talk about that.
Gene: Or sales incentives. If they hit certain goals or whatever, whoever wins. So that was one thing that we’ve done. Second thing that we’ve done is-
Elizabeth: Godiva chocolate?
Gene: No, no Godiva chocolate. I go to CardCash, have you ever heard of CardCash?
Gene: So CardCash is a … It’s a site, we can put it in the show notes, and you can buy gift cards there at a discount.
Gene: Because for some reason people sell their gift cards. Well, not for sale. I sold, three years ago, somebody gave me a gift card to the Hair Cuttery for 100 bucks. So people, whoever, if you’re listening right now, imagine. You don’t have to imagine too much. I would have very little use, right? You can attest to this, Elizabeth.
Gene: For a hundred dollar gift card at the Hair Cuttery. Okay, so that’s worthless to me. Anyway, I went on to CardCash, and I sold it for 50 bucks.
Gene: And then they turn around and they sold it for 75.
Gene: Get it?
Gene: So it’s 100 dollar value, but they made some money and I made some money. They’ve got it for every … They have gift cards on this site, Elizabeth, for the Outback Steakhouse. I don’t know who is giving up a gift card for the Outback Steakhouse. Best restaurant in the country. You get a steak and fries and salad for 27 dollars. But some idiots are giving away these gift cards-
Elizabeth: 27? Less than that.
Gene: Oh, it depends on the region that you’re in.
Elizabeth: Oh, okay.
Gene: But, oh, it’s fantastic. And now you can give gifts. I buy every year some discounts, some gift cards at a discount. And then I give them away to employees-
Elizabeth: To Outback Steakhouse?
Gene: For a job well done at the end of a project or whatever. It’s like, “Here, take this gift card. Take the family to the Outback.”
Elizabeth: So, do you … So let’s … How do you figure out how to do that? Do you just remember it one day? Like, “Oh, I should do that!”
Gene: I do. I mean, usually, yeah. Again, I’m all about … We talked on a previous episode about my customer relationship management system, so.
Elizabeth: Yeah. You just have prompts.
Gene: I just prompt. I have a lot of reminders so I know those things don’t fall off the cracks. And then, that way, and I’m just making sure that people, when they do a good job, they get a little bit of a-
Gene: Then the other thing that we do, and I’ve learned all this, but we should have a whole other episode on credit cards for small businesses.
Gene: Right? Now we use the Citi Bank “Thank You” card for our-
Gene: Personally and for our business. And I’m not saying that’s the best or whatever. That’s just what we use, and I’ve had good success with it. The Citi Bank “Thank You” card is very good because you accumulate miles for what you purchase in your business, and personally you can combine the accounts. And then they have this huge exchange. You can exchange these points for a lot of stuff. Travel, as well, is very big. Used to be, I would accumulate travel miles for U.S. Airways, and I could trade it in for a flight to Fargo in January, you know?
Gene: With all the blackout dates.
Gene: Citi … They don’t have any of these blackout dates. So I accumulate a lot. I can get travel vouchers, I get gift certificates, I get gift cards, I get whatever. And I give them to employees for a job well done. It’s just found money.
Gene: It’s not even … It’s just found money.
Gene: Nothing’s coming out of my pocket. They were just …
Elizabeth: So, let’s say you’re a small business, you have-
Gene: I am.
Elizabeth: Let’s say-
Gene: Ten employees.
Elizabeth: Not as established as you, though.
Elizabeth: Let’s say you’re starting out, you have five employees.
Elizabeth: Let’s say you’re you fifteen years ago.
Gene: Okay, okay.
Elizabeth: What do you think is a reasonable amount of money to spend on thanking your employees every year?
Gene: First of all, I think it depends … I hate generalizing because it really depends. If this was me fifteen years ago, I didn’t have any money to spend-
Gene: On my employees.
Gene: So there’s no reasonable amount to spend-
Elizabeth: Well, a lot of our listeners might be … might feel like that.
Elizabeth: But we always say the biggest investment, the best investment, is in your employee list.
Gene: It’s absolutely true, but then again, your better investment is spending the money on your business so your employees actually have jobs next year, you know? And not frivolously throwing it away-
Gene: On whatever, so. To me, I think it’s … You want to do some … You don’t have to give them anything other than a thank you-
Gene: For all the great work that they have done.
Elizabeth: So maybe you write them a card?
Gene: Something personal, or-
Elizabeth: You don’t force them to have lunch with you or anything.
Gene: Yeah, it’s exactly right, you know? They’re … They might not be into doing something like that, so.
Gene: Or at the very least, what we used to do, now I’m thinking back on. So 15 years ago was a long time. 20 years ago, even when I started out. We … I used to have a barbecue at my house.
Gene: And we used to do that and I’d say, “Come if you want. Don’t come if you don’t want to. It’s fine.” But-
Elizabeth: That’s a wonderful invitation.
Gene: Can you imagine? And you know what I used to do? Because I’m such a cheapskate, I used to combine it. We did a July fourth barbecue every year for our neighbors.
Gene: And somehow my wife bought into that, and every year, we would be the barbecue house on July 4th.
Gene: So I would go out and buy the beer and the burgers and the dogs. It was very whatever. And I would invite my employees, too. So, yeah. So it was … Right? At least I’m barbecuing anyway. You know, come on by. You know, whatever. It’s not-
Elizabeth: Who wants to spend a holiday with their boss?
Gene: Well, it’s, first of all, you don’t have to. I mean, you can just come on by and grab a burger and leave. It’s completely up to you to come. Listen, we were a small business starting out. What do you expect me to give them, a Cadillac? You’re trying to say thank you in some way now. You do have the ability to give money, you should. The final thing that we do, though, in all seriousness, I still do this every year, is I give bonuses to everybody at the end of the year.
Elizabeth: The hardest job I’ve ever had, I worked on a big, big, project, and there was not a lot of money after it. It was … But it was … It took over a year.
Elizabeth: It was a ton of work.
Elizabeth: Working 24/7. I didn’t get any thanks after that.
Elizabeth: No, no, no. But what I got was … The person who was running the project wrote an actual handwritten personalized note to me. It wasn’t that long, and it was just-
Gene: And you still remember this, don’t you?
Elizabeth: I do remember it.
Elizabeth: And it really just acknowledged all of the hard work I had put in just by saying, “I know how much hard work you put into this. I know you put a lot of heart into this. I really appreciate it.” And that’s the best thing I’ve ever gotten.
Gene: Do you know what’s funny that you just said this? I just did a project for a larger company recently, and it involved people from their marketing department and whatever.
Gene: And there was a young woman in the marketing department. She was two years out of college. I mean, typical millennial whatever. And we finished the project, and would you believe she sent me, and this was a 23-year-old person, a handwritten note in 2017?
Elizabeth: That’s so nice.
Gene: And it was so nice, and it was very … At a young … You don’t think, “Whoa, this generation. They’re all …” You think she would text me a thank you, you know what I mean? So, whatever.
Elizabeth: Put it on Snapchat.
Gene: Yeah, and she was … It was so sweet, and she wrote this really nice hand … Put it in the mail, I got it in the mail, it’s this card with a handwritten … She was the only one from the whole … She was only one of the people on the team working, but she wrote it. But now-
Elizabeth: And now you can use that to shame your own children, right?
Gene: Well, I gotta tell you. The power of a handwritten note to your employees, to your customers, it’s … You listen to your elders.
Gene: People like me, in our 50s.
Elizabeth: Now what if you have really terrible handwriting like I do?
Elizabeth: Have you seen my handwriting?
Gene: No, I haven’t.
Elizabeth: It’s frightening.
Gene: Alright, well, you’re gonna have to get a print.
Gene: Okay. Or you could just use cursive. Me too. But I think a handwritten note, I think, is actually also a really, really nice thing to do.
Gene: And in the end you don’t have to spend that much. I’ll get back to what you were saying about saying you don’t have any money or you’re just starting out or whatever. Listen honestly, Elizabeth, a 50 dollar or 25 dollar gift certificate. 50 dollar gift certificate to say, “Hey, go out with your significant other and have dinner on me. Thank you-
Gene: For all the work that you did.”
Gene: And if you’re a very small business, please get that. It’s nice.
Elizabeth: I’ll tell you what employees really want, aside from a … And I do want to acknowledge and then note, it wasn’t so much just that … It wasn’t the thank you, it was the fact that the person was-
Elizabeth: It wasn’t the … It’s not that I need a pat on the head, it was more just the fact that he understood how hard I had worked.
Elizabeth: And took the time to actually write that down. I think that’s what you need to do.
Gene: I agree. Everybody loves to … Everybody likes to get praised.
Gene: And I-
Elizabeth: It’s not … That’s what I’m saying, though. It’s not even the praise.
Elizabeth: It’s more just the fact that he took the time to acknowledge-
Elizabeth: This person worked hard.
Elizabeth: They put a lot into this.
Elizabeth: And then took five minutes to write me a little note.
Gene: Even at my age, I still … it’s still nice when somebody says, “Thanks” and “Good job.” But, I mean, you know-
Elizabeth: I’ll tell you-
Gene: You can never get enough of that.
Elizabeth: Here’s what your employees really want.
Elizabeth: They don’t want a party, they don’t want a gift-
Gene: They don’t want to come to my backyard and my neighborhood?
Elizabeth: They want … But they want more … gift card. What they want more than anything else-
Gene: Time off.
Elizabeth: Is a profit-sharing plan.
Gene: Profit-sharing plan. Ah.
Elizabeth: And we’re gonna talk about that in the next episode.
Gene: Alright, alright.
Elizabeth: We’ll be right back in a couple days with our take on profit-sharing plans.