It’s no secret that these first few years of the 2020s have brought forth seismic change in business; however, there’s one change you might not be aware of yet: the rapidly growing shortage of accounting professionals. In December 2022, the Wall Street Journal summarized the situation: “More than 300,000 U.S. accountants and auditors have left their jobs in the past two years, a 17% decline, and the dwindling number of college students coming into the field can’t fill the gap.”
Such a shortage could create burdensome circumstances for business owners. So, exploring ways to build a more synergistic relationship with your accountant now can make for a better future for both of you.
Tip 1: Reduce your accountant’s administrative time.
One of the easiest ways to improve your working relationship with your accountant is to reduce the amount of administrative work required to manage your account! Here are a couple of tips to get you started:
- When gathering paper information for your accountant, scan and convert it to PDF. Then upload it to their secure portal.
- Many accountants use software that includes optical character recognition (OCR) technology, which helps automate the categorization of transactions. PDF files are typically easier for this technology to read than image files, so save your files accordingly.
- For multi-page documents, combine all pages into one PDF file. Conversely, avoid consolidating separate documents into one PDF.
- Use your customer portal instead of email if one has been provided to upload documents.
Tip 2: Be mindful in communications.
Good communication is an essential part of the accountant-customer relationship. A great customer will take the time to read any emails or correspondence and answer all the questions in the email (not just the first one!). They’ll also keep their accountant informed as they prepare to make financial decisions, like hiring a new employee, making a capital investment, or moving their money to a new bank. Proactive communication can help your accountant provide timely information so you can make intelligent business decisions. It can also help both of you avoid messy (and costly) cleanups.
Both you and your accountant may have preferred ways of communicating, among the choices of text, voice, and email. Keep in mind your accountant has a higher duty to protect your private information. Text and unencrypted email can be problematic for them, particularly when sensitive information is being conveyed.
You can make your communication more efficient by saving non-urgent questions for your next meeting together. As a result, you’ll be able to cover much more ground in your sessions, and your accountant will appreciate fewer emails in their inbox.
Tip 3: Vet any advice you hear first before contacting your accountant.
Be wary of unsolicited advice and tips you might see on social media. They can be uneducated at best and downright fraudulent at worst. One of the most prominent examples we’ve seen involves ERC mills. These companies have sprung up to “help” small businesses claim the Employee Retention Credit from 2020 and 2021. Unfortunately, most of these companies are not following IRS guidelines and do not have the credentials to evaluate the tax law properly. And if you’ve been working with an accountant the entire time, chances are high that they’ve already helped you acquire any ERC funds your organization is eligible for.
Lastly, social media sources can be chock full of unreliable information. For example, TikTok and Instagram have some outrageous financial claims going around. If it sounds too good to be true, or you suspect the video was created by someone who is not a qualified or licensed accounting professional, take the information with a large grain of salt and speak with YOUR accounting or tax professional before acting on any advice you hear.
Improving the way you work with your accountant ultimately benefits everyone involved. By reducing your accountant’s need for administrative work, being mindful in your communication, and vetting advice you hear first, you can create a mutually beneficial relationship with your accountant that ensures a lasting, productive relationship. Remember, as your accounting professionals, we want to support your business goals and help you succeed!
As the days start to grow longer and new growth arrives, it’s time to think about refreshing your products, services, and marketing campaigns for the new season! Spring is the perfect time to boost your business by taking advantage of the renewed energy in the air.
There are plenty of ways to keep your customers engaged this spring. So let’s take a look at five ways you can take advantage of this vibrant new season and allow customers to see your products and services in a different light.
- Add a holiday twist.
With various spring holidays to choose from, consider those that most closely align with your organization’s identity and consider building a sale or promotion around them! Here are a few key holidays to get you started:
- May Day
- Mother’s Day
- Memorial Day
- Flag Day
- Father’s Day
Memorial Day is the biggest shopping holiday of the season; it ushers in warmer weather and signals the end of school for kids and teachers. Plus, customers are used to seeing sales during this long weekend. Mother’s Day can be a revenue booster for many businesses as well.
Which one of these holidays can you best connect your products and services? That’s your answer for an effective spring sale. For an egg farmer, incorporating the tradition of decorating Easter eggs is a no-brainer. So figure out what your business’s Easter egg is and go from there!
You could also consider other lesser-known holidays that align with your brand’s identity, products, or services. For example, National Plant a Flower Day on March 12th would be an excellent opportunity for a nursery to promote a free potted flower plant with a purchase. Websites like NationalDayCalendar.com can be a good way to help you get started.
- Temporarily switch to spring packaging.
If you sell products with physical packaging, add some color to help your product stand out! Traditional spring colors include green, yellow, pink, orange, baby blue, and pastels. Consider adding flowers, new growth, or other spring motifs where it makes sense, too.
The same can be done with any digital marketing collateral, too. For example, do you provide prospective customers with a service menu they can choose from? Try incorporating springy accent colors that complement your brand colors, or infuse your copywriting with language that reflects optimism, growth, and new beginnings.
- Host an open house.
If you have a brick-and-mortar location for your business, an open house could be a wonderful option for building trust with prospective customers. Invite your prospect list and current clients – you can even ask them to bring a friend – and offer refreshments with a spring theme. Plan an agenda with a speaker on a topic adjacent to your offerings and allow time for guests to mingle and network.
Work remotely? If you have a local customer base, host your open house at a coworking space or similar venue. If your customers are more spread out, invite prospects to an information-rich (but not salesy) webinar instead.
- Free spring gift with purchase.
While providing a free gift is already standard practice in the cosmetics industry, you can likely apply the concept to your business, too. Consider a freebie that complements your offering, aligns with your brand identity, and, most importantly, adds value for your customer. And if possible, consider how you can align it with the season!
Graduation season can be the perfect time to promote your services or products, as it marks the start of a new chapter in life for many. It’s an excellent opportunity to remind people how your offerings can help them take the next step in their career or tackle their next big goal.
Additionally, you can use this time to tap into the sense of excitement and optimism many graduates feel and create an emotional connection with your target audience.
Spring is a great time to think about how you can bring fresh ideas into your business’s offerings and marketing strategies. Whether that’s simply adding spring imagery to your branding or something more complex like creating a new campaign with a bonus gift, consider how you can leverage the new season to stand out and reach a broader audience.
With some creativity, you can make the most of the season and give your revenue the boost it needs to stay ahead of the curve!
Cool Tech Tools: Drones
When drones were first introduced to the consumer market, they were thought of almost exclusively as novelty tech toys. But they can have a surprisingly high impact on the success of some businesses, too! The flying robots can be controlled by a remote device and usually include a GPS and built-in sensors. Drones can be used to help companies:
- Access places that may not be safe for employees to go
- Increase efficiency and productivity while decreasing workload and costs
- Improve accuracy
- Gather information for pricing estimates, such as roof repair
- Inspect items, such as a tree’s disease progression
- Monitor systems or the status of certain things, such as landfill fire risks
- Photograph items or locations from an aerial view for use in marketing or record documentation
Many industries have begun routinely using drones, such as:
- Waste Management
- Disaster Relief Services
- Professional Photography and Cinematography
- Real Estate
- Event Planning
- Highways, Traffic, and Road Safety
Rules for Drones
Before you fly your new drone, there are rules you’ll need to follow. The FAA (Federal Aviation Administration) has set the rules for flying drones safely. There may also be legislation passed at the state and local levels that you’ll need to check on.
When using drones for commercial purposes, you’ll need to register your drone, familiarize yourself with the operating rules for your type of drone, and pass a pilot’s test. Find out more here: https://www.faa.gov/uas
Cost of Drones
Drones can cost anywhere from $50 to $25,000 and more. A beginner recreational drone can cost under $100, while a beginner commercial drone can range from $300 to $500. A commercial drone typically starts at $1,000. Drone prices will vary depending on their size, features, and intended usage.
Incorporating drones into your business can be a great way to save time, increase efficiency, and reduce costs. Drones provide a unique insight into areas that may be difficult to access or monitor, and their capabilities are ever-expanding. With careful consideration and research, drones may be able to provide an invaluable resource to your business and give you a competitive edge.
If you have accumulated more money in your business checking account than you need for daily operating expenses, congratulations! That is an excellent “problem” to have! It could be time to consider putting that money to work for you. A business savings account can help small business owners plan for the future and ensure financial security. It can provide a protected place to set aside funds, allowing you to save for a rainy day, prepare for less prosperous seasons, invest in new equipment, or take advantage of opportunities that may arise.
A business savings account can also provide you peace of mind, knowing that money is available when needed. In addition, access to higher interest rates and the ability to transfer funds quickly is a great way to help ensure greater financial security for the business.
Every banking institution is different when it comes to the features and benefits of its business savings offerings. We’ve assembled a list of common questions you may want to consider asking your banker before opening a savings account:
- Is your checking account interest-bearing, and if so, how does the interest rate compare to that of a business savings account?
- Is there an initial minimum deposit to open the savings account?
- What are the monthly fees for each type of account?
- What minimum balances are required in both checking and savings accounts so that fees are waived? And, would it be worth it to keep minimum balances?
- Are there withdrawal limits?
- What are the other benefits of having a business savings account with your institution?
- Is my money FDIC-insured, and if so, what is the cap?
Often, a bank will tie the checking and savings accounts together, and there will be a combined minimum balance that is lower than if either account was separate. For that reason, having your checking and savings accounts in the same bank might be more effective. Other common benefits include waiving overdraft fees, wire transfer fees, and NSF charges.
There are other types of interest-bearing accounts besides savings accounts, including money market accounts and certificates of deposits (CDs).
A money market account is a type of savings account that allows you to earn a higher rate of interest than a traditional savings account while also providing you with access to your funds. It may have check-writing privileges, but the withdrawals may be limited. Certificates of deposits, or CDs, typically pay higher interest rates than traditional savings accounts. Still, they tie up your money for a specified period, and steep early-withdrawal penalties exist.
Many institutions besides your primary bank are focused on savings accounts and will pay much higher interest rates. For example, online banks and credit unions typically pay a higher interest rate than a brick-and-mortar bank; however, the money may not be FDIC-insured, so be sure to read the fine print.
An additional benefit of keeping money in a separate savings account is that you can save for many things:
- A cushion for emergencies.
- Lump sum tax payments.
- Future capital expenditures.
Once you’ve set up your new savings account, consider scheduling recurring transfers to it so that you build up your savings balance.
A business savings account is a great way to ensure your business is prepared for unexpected costs, expenses, or growth opportunities. With a business savings account, you can put your unused funds to work, earning you higher interest than a checking account could. By incorporating a savings account that works for your business’s needs, you can feel more secure about the financial future of your business.
As business owners, we’d like to think that we make rational, logical decisions regarding our business finances. However, scientists have discovered hardwired biases in our minds and thought processes, one of which is the sunk cost bias, also known as sunk cost fallacy.
A sunk cost is simply money, time, or resources you have already spent and can’t recuperate. Another word for them is retrospective costs. The bias comes into the picture when we consider those costs in future decisions.
The sunk cost fallacy, first hypothesized by Richard Thaler in 1980, is a cognitive bias where people overestimate the importance of sunk costs in their decision-making. He wrote, “Paying for the right to use a good or service will increase the rate at which the good will be utilized.”
In a 1985 paper by Hal Richard Arkes and Catherine Blumer titled “The Psychology of Sunk Cost,” the authors found evidence that this tendency is “predicated on the desire not to appear wasteful.” Furthermore, “those who had incurred a sunk cost inflated their estimate of how likely a project was to succeed compared to the estimates of the same project by those who had not incurred a sunk cost.”
Essentially, instead of making a decision that’s right for themselves and their future based on current circumstances, people will make a decision heavily informed by the action already taken, even when it isn’t relevant to current circumstances. It doesn’t sound very productive, does it?
Let’s discuss two examples of the bias in action. First, let’s say you have spent a lot on car repairs. You continue to repair the car, digging a deeper and deeper hole. Making a $3,000 downpayment toward purchasing another vehicle is likely a better decision than sinking the same amount of money into another round of repairs. However, you are still emotionally (and irrationally) attached to all the money you spent on the clunker.
Now say you have an employee that is a borderline performer. You keep investing in them, thinking you can “fix” them. However, they don’t improve. Regardless of whether the employee is insubordinate or simply not the right fit for the role, letting them go was likely the right move to make some time ago.
So, now that you know about the sunk cost bias, how can you avoid falling into it in your business? Here are some ideas:
- Increase your mindfulness when making decisions that involve costs already incurred. Ask yourself, “what decision would I be making if I hadn’t already invested the time/money/resources into this project?”
- Since the bias can often come as the result of not wanting to experience negative emotions like feelings of failure, irresponsibility, or loss, try to remove your emotions from the equation altogether. Instead, examine the business project at hand from a facts-only perspective. Ask yourself, “What does the data show me?” Then do the math.
- Track key performance indicators (KPIs) regularly to see whether you’re on or off track and assess whether it’s worth continuing the project sooner.
- Like setting a budget for holiday shopping, establish goals and milestones for future projects, and have a “walk away” plan if things spiral out of control.
- Stay future-focused.
Ultimately, it will be up to you to ensure that sunk cost bias doesn’t affect your decision-making in the future. Hopefully, this information and the five tips we provided will help you orient yourself to make business decisions that benefit current and future you, rather than past you.
If you’d like to learn more about cognitive bias, including the sunk cost bias, check out the works of two additional scientists, Daniel Kahnerman and Amos Tversky (the former of whom won the Nobel prize for his work!).
Are you looking for new ideas to market your business? Knowledge panels might be an excellent tactic to consider. If you haven’t heard of them, don’t worry; many people haven’t, but they are a Google invention widely used in search results daily.
Knowledge panels are the information panels that appear on the bottom right corner of your search results when you look up specific people or brands. They differ from the business profiles you see when you query a company, which Google Business Profile provides.
Knowledge panels display information that Google has collected in its Knowledge Graph, which is one of Google’s information databases. For example, search for a favorite author or your current Congressperson, and you can see an example of a knowledge panel. Famous historical figures and extremely popular entertainers may have a more robust page displaying all of the information about them, but there will typically also be a column of text to the right (you may have to scroll a bit to see it), which is the knowledge panel.
So, how can you use knowledge panels in your business? A knowledge panel representing your leadership or brand brings instant credibility and visibility to your organization. It boosts reputation and helps to build trust with all stakeholders.
Who typically has a knowledge panel? If you happen to be an author of a book with a formal ISBN (International Standard Book Number), you would automatically get one. If you are a leader of certain organizations, like Bob Iger of the Walt Disney Company, you will also get one. If your brand is well-known, it will have a knowledge panel.
You can’t create a knowledge panel, but you can claim it once it appears. Google determines who receives a knowledge panel. But you can “lobby” for one, and there are marketers you can hire to help you execute the steps it takes to get one. The main thing is to be active and visible online.
If you already have a knowledge panel, there are procedures documented on Google Help that you can follow to claim it. You can also make edit suggestions and submit them to Google. You can’t directly edit your knowledge panel, however; Google has final control over what is displayed.
After reading this article, we hope you now have a good jumping-off point to understanding and obtaining a Knowledge Panel. With so many marketing tactics available online to help promote your business, it’s essential to stay in the know about them!
A balance sheet is a financial statement showing a company’s assets, liabilities, and equity at a specific point in time. It’s one of the foundational financial reports for your business. But did you know the equity section of the balance sheet looks different depending on a business’s legal structure? The most common entity types are corporations, partnerships, and sole proprietors. Recently, we discussed what equity looks like on a corporate balance sheet. This time, we’ll review what the equity section of the balance sheet looks like for sole proprietors.
The Equity Section
The equation Assets = Liabilities + Equity is true for all entities. For a sole proprietor, equity is called Owner’s Equity. There are typically two accounts listed: the Owner’s Capital Account and Owner’s Draw Account. We define both below.
Owner’s Capital Account. This balance represents how much money the owner has put into the business. Also included are cumulative business income or loss amounts from prior years.
Owner’s Draw Account. This balance represents how much money the owner has taken out of the business. Since a sole proprietor does not get a paycheck, taking money out of the business via a draw is how they receive their money.
A third account will show up if you run a balance sheet report in your accounting system on any date during the year: Current Year Earnings. This balance is the same as the net income on the year-to-date income statement. It represents the profit of the business.
On a formal balance sheet for external purposes, only one account will show: the Owner’s Capital Account. This is because the draw and the current year’s earnings will roll into that account.
Salary vs. Draw
It’s important to distinguish between the concepts of a salary and a draw. In corporations, owners receive salaries in the form of paychecks, where payroll taxes are deducted, and W-2s are issued at year-end. In the corporation’s income statement, the salary and taxes are deducted as expenses.
For a sole proprietor, this is not at all how it works. A sole proprietor has no salary. Therefore, there is no payroll expense or payroll taxes on the income statement for the owner. The owner could have employees, and those payroll expenses would be shown on the income statement, but there is nothing for the owner.
Instead, the owner takes draws, which are not an expense; they’re simply a reduction in equity. They do not affect profits or change taxes owed. An owner can take a great deal of money out of the business, and there is no impact on profits. There is undoubtedly an impact on cash flow, however!
A sole proprietor does pay payroll taxes in the form of self-employment taxes. They simply do it on their IRS Form 1040 as opposed to payroll tax forms that a corporation would use.
The equity section can be the most challenging to understand on the balance sheet. Hopefully, the explanation above will provide more clarity so you can better understand how to read your business’s financial statements.
Running a business can be incredibly rewarding, but it can also be incredibly exhausting. As a business owner or manager, it’s essential to take the time to slow down, recognize when you’re feeling overwhelmed, and take proactive steps to reduce fatigue and burnout. In this blog post, we’ll explore the importance of sustainable business practices and how slowing down can help protect your physical and mental health while supporting organizational success.
1. Eliminate wasted time.
Take a thoughtful look at your to-do list. Are there any tasks that take significant time and resources to complete that don’t offer you the return on investment to make them worthwhile? What would happen if you eliminated them from your to-do list entirely? Would you still meet your desired destination? If yes, it may be time to axe that task. Consider this quote from The Four Disciplines of Execution: “The only reason you fight a battle is to win the war.” Is this task going to help you win it? Or does it just feel productive?
2. Get off electronics and social media.
Vision Direct polled 2,000 adults in the U.S. and found that the average person spent over 6,259 hours per year staring at screens. If that statistic is making you sweat, or if you feel like you don’t have any time to live the life you want to, your work-life balance could be lurking behind the electric glow of your devices. Instead of setting an ambiguous goal to use your cell phone less, try tactics like:
- plugging your phone in overnight in a different room to prevent you from starting your day by doom scrolling
- Setting an alarm at night to set the phone down and enjoy some ‘analog’ activities
- Utilizing your phone’s screen time features to remind you when you’ve spent a certain amount of time on any one app.
- Turning your phone off and putting it away for–gasp–an entire weekend day.
3. Get enough sleep.
Sleep deprivation can negatively impact your executive functioning abilities. If you are sleep-deprived, everything takes longer. Mistakes happen more frequently. Emotions become hard to regulate. Slowing down and getting enough sleep each night can make you more productive, reducing work hours. Plus, you feel more refreshed.
If getting to bed an hour earlier isn’t feasible for you, could you find time to rest your eyes for 15 minutes a few days a week? According to the Sleep Foundation, “A nap can improve cognitive functions such as memory, logical reasoning, and the ability to complete complex tasks.”
4. Zoom out to gain a new perspective.
It’s called the hamster wheel for a reason: you’re moving so fast you can’t see that you aren’t actually going anywhere. Slowing down your usual routine can help you gain perspective. Now that you’ve cut out superfluous tasks, cut down on screen time, and are getting more rest, use that extra bandwidth to reconnect with your mission, vision, and purpose. You might have been fighting fires in the trenches for so long that you’ve forgotten why you’re in business. Make sure your employees understand their grander goals as well.
5. Avoid multitasking.
By this point, we’ve all heard the data that multitasking doesn’t actually save time. But are you executing the discipline to work on tasks one at a time, or are you task-switching in rapid succession? Almost everyone thinks they are good at multitasking, but a study by Jason M. Watson and David L. Strayer concluded that only 2.5% of people can multitask effectively.
Becoming self-aware of your habits related to multitasking is the first step. Next, consider batching your work by client or task type. Note when you’re feeling more energized throughout the day and when your attention seems to lag. Then plan your work accordingly. This process is called capacity planning or time batching, and we have an entire article dedicated to it here. The key is to continue experimenting within the framework and see what works best for you.
6. Get better at managing distractions.
If you get interrupted every five minutes, you will feel drained of energy at the end of your work day. Get smart about managing interruptions so you can be more productive. You can try strategies like:
- Setting your phone to “do not disturb.”
- Carving out time on your calendar as “unavailable” so teammates don’t have total access to your time.
- Placing your phone somewhere you can’t mindlessly reach for it.
- Turning email and chat notifications off.
- Working during an off time.
- If you’re in a physical office space, close your door.
7. Stop worrying about billable hours (for service businesses) – at least for a while.
If you’re feeling fixated on billable hours as of late, it may be time to take a step back, even if it feels counterintuitive. Otherwise, this preoccupation could affect the quality of service you’re able to offer your customers, which could lead to a decrease in customer satisfaction and hurt your reputation.
In addition, that constant attention on billable hours might even be causing you unnecessary stress. It’s not sustainable for every season of your business to be one of exponential growth. Sometimes, holding fast for a quarter can give you time to reevaluate your priorities in your business and personal life. This, in turn, can allow you to step forward confidently when the time is right.
8. Do nothing.
It’s actually okay to do nothing sometimes when you’re the business owner. Your mind needs space to develop new ideas, think about creative solutions to complex issues, and even daydream. Does the act of doing nothing leave you feeling incredibly uncomfortable? Then it’s probably exactly what you need.
By implementing these new strategies to free up time, you’ll find you’re better able to take back control of your day and slow down. Slowing down in your business is essential for your mental and physical well-being. Taking the time to rest, recharge, and evaluate your goals will allow you to refocus and realign with your purpose. When you are in a state of balance, it becomes easier to make decisions that benefit your business and your life.
And just as importantly, slowing down allows you to enjoy the fruits of your labor, appreciate the moments of success, and celebrate the milestones you have achieved.
How do you arrive at a price for the products and services you sell? While it depends on what industry your business is in, a handful of foundational pricing methods will be useful regardless of your business model. We outline five: time and materials pricing, cost-plus pricing, market pricing, target pricing, and value pricing. Let’s dive into each one.
Time and Materials Pricing
Time and Materials (or T&M) pricing is a method used by many service-based organizations. As you might have guessed, T&M pricing is based on the time spent performing the service. A few great examples of Time and Materials pricing include the hourly rate an attorney charges, the rate a massage therapist charges for a 50- or 80-minute service, or the minimum fee a plumber charges, plus a different rate for subsequent hours. It’s also a method typically used in construction and product development.
In some cases, time-based pricing may be loosely tied to the salary level of the person performing the service. Still, there must be a substantial markup to cover payroll taxes, health insurance, overhead, training, and any materials or tools that are included. While costs like hourly rates, materials, equipment use, and independent contractors are typically agreed upon by the provider and customer ahead of time, the customer won’t usually receive an estimate in advance.
Cost-Plus pricing (also referred to as Markup pricing) is typically used in the retail industry. Retailers select inventory from a manufacturer or wholesaler and then make those products available to the public for purchase. This method is based on unit cost plus a markup. A typical example is keystone pricing, when an item is marked up to twice the purchase price plus one dollar.
Other industries that use cost-plus include groceries and auto dealers, but the pricing approach would also be relevant to businesses like a bakery, which purchases inventory in the form of ingredients and transforms them into a new product, like a pie.
Market pricing is the act of establishing the price for your goods or services based on the rates your competitors are currently offering. It is dependent on fluctuating market conditions and allows the seller to stay competitive with other providers. Commodities are the best example of Market pricing: Crops, oil and gas, and metals are all priced by the market.
Target pricing is the process of beginning with a price that you feel customers will be willing to pay, and then designing a service or product around it. It’s commonly used in the SaaS, or Software as a Service, industry.
For example, let’s say you develop a concept for a subscription-based application that you believe consumers will pay a competitive rate of $29/month for–note that this price will be based on market research, not a ‘gut feeling.’ You would then build your application (and the resources required to support it) around a budget driven by the target price. If an organization can’t create the application build within the budget, it scraps the project.
When an organization takes the Target pricing approach, it can be more confident of a reasonable profit because the price is already consistent with market demand.
Value pricing is based on the price a customer is willing to pay and what they value, rather than the direct cost of the product. For example, a customer with more to gain from employing your services is likely willing to pay more than a customer of smaller means with less to gain. This is because, while both customers may receive the same services, their perceived value of your services is different. Thus, they’re willing to pay different prices. For project-based work, Value pricing can be based on the customer’s expected return on investment (ROI) and is used in digital marketing and for some professional services.
Pricing in Action
In business, determining a product or service’s price is part math and part art. It may even be a combination of two or more methods listed above. There are many factors and considerations that will inevitably go into your pricing decisions. New Business Directions can help you determine if your prices are adequate for the profit margins you want, competitive with your industry’s standards, and more. We can also help with if-then scenarios. For example, if you raised your rates by $100 an hour, but demand went down five percent, what would your profit margins look like? Please reach out to us to schedule a paid consultation if you would like us to help you with your pricing process.
By now, you’ve probably seen the new buzzword “Quiet quitting” floating around. Coined in 2022 and popularized through TikTok, the term refers to an employee who remains working but reduces their performance to the bare minimum required to keep their role.
On the other hand, critics of the term say that “quiet quitting” is simply accomplishing the essential duties and refraining from going above and beyond the job description without adequate compensation, avoiding the glamorization of hustle culture.
Whether a result of a favorable job market for employees or a new shift in priorities to a more sustainable work-life harmony, if you suspect quiet quitting is taking place at your organization, it could be time to take action. Instead of coming down harshly with written warnings or other punitive measures, consider a supportive leadership approach, addressing the root causes of employee dissatisfaction.
Keep reading for a few suggestions to get you started.
On the macro level:
- Implement employee wellness programs designed to reduce stress and improve physical and mental well-being, such as an incentivized movement challenge or free access to a mental health app like Headspace.
- Add some perks, such as a sponsored weekly, in-house yoga class or a program led by an instructor certified in mindfulness-based stress reduction methods.
- Encourage employees to take vacation time to reduce burnout. If an employee doesn’t feel empowered to take time off, there could be underlying issues in your company procedures that need to be addressed.
- Add training programs so that employees can have a chance to develop new skills.
- Add an education reimbursement program where employees can return to school and earn a degree or certificate related to their job.
- Ensure that employees’ health plans include a substantial mental health component.
- Partner with a child-care and/or senior-care agency to reduce the stress of finding support for families who need it. Providing care support will especially help women re-enter the workforce, as they have been impacted most by the increased care demands brought on by the pandemic.
- Bring back the company holiday party, annual picnic, or movie night so employees can socialize with each other again. If you have a fully or partially remote team, a virtual party during work hours is also a great option, and there are companies that can help you facilitate one that’s fun for all.
On the micro level:
On the individual level, and especially for team members you suspect could be quiet quitting, it’s a good idea to conduct a formal process of setting goals.While this is generally accomplished during annual or seasonal employee performance reviews, it doesn’t have to be. It can be very effective to sit down with an employee and simply ask what they want to get out of this job and what they want their future to look like. Have a conversation with team members.
Goal-setting encourages well-being and can give an employee something to strive for. In addition, refreshing goals quarterly can help a team member re-engage with their role. It can also help a supervisor identify an employee who might be happy doing another job, creating the opportunity for a reassignment that is advantageous for both parties.
Increasing Employee Engagement
Anything that can help to refresh and rejuvenate your employees will help reduce a culture of contempt in your organization. While many of these approaches come with some associated costs, it’s essential to consider the alternative cost of an underperforming team or even the cost of a new hire. So start your approach with an initiative that will have the most significant impact on the well-being of your team—and unless you’re already doing most of the above, that probably isn’t a pizza party or free SWAG.