It’s no secret that you have to minimize your business expenses to maximize your profits. However, all things come at a cost, including progress. You don’t want to risk losing long-term staff loyalty for temporary short-term gains.
Your workers are the lifeblood of your organization — without them, the show would grind to a halt. Investing in their well-being is a wise business move, but it does require expenditures. Here are six ways employers can reduce their costs without cutting corners on employee benefits.
1. Explore Your Options
Cutting or eliminating benefits packages is a surefire way to sew dissension among senior employees who will justifiably see such a move as a pay cut. However, as an employer, you have multiple options for what carriers to choose.
Ask questions when you sit down with your benefits representative. Understand your staff will also have inquiries about new plans, such as whether they can keep their current doctor and what restrictions the policy places on pre-existing conditions.
Explore alternatives such as prescription drug discount plans. Pharmacy alone accounts for 20% to 25% of total health care costs, and rates continue to rise. You might need to explore several combinations of offerings to find the ideal plan for your organization.
2. Offer Employee Choices
One size does not fit all when it comes to benefits. If you have a wide and diverse employee pool, offering choices lets you mitigate expenditures while giving staff members a sense of agency and control over their financial futures.
For example, young parents might need help covering childcare expenses but only a bare-bones health plan, while those with chronic conditions might want more comprehensive
insurance coverage. If possible, allot a specific dollar amount per employee and let them mix and match their benefits packages buffet-style.
Also, investigate low-cost alternatives that make a huge impact on morale. Many employees appreciate the convenience of an onsite fitness center, for example, but your organization might lack the budget for a dedicated weight room. Instead of throwing a treadmill in a supply closet, look around the area for nearby health clubs. Many will partner with you to offer discounted memberships, which you can then extend to your staff.
3. Reduce and Recycle
Depending on your organization type, you might be able to make a small fortune on your scrap materials. For example, you can fetch top dollar for leftover lumber and copper wiring if you run a construction crew. Negotiate with local suppliers who will sometimes repurchase leftovers or offer them to charitable organizations at a steeply discounted price — you still make more than you would tossing them in the dumpster.
Many offices go through tons of unnecessary supplies. Is it necessary to print out a copy of meeting agendas for every participant when you can just as easily project the to-do list onto the whiteboard? Going as paperless as possible can save you a small fortune on reams while being kinder to the planet and its trees.
Green energy alternatives, likewise, can save you considerable cash. Going low-flow with toilets and other water features can slash that utility bill by 30% while preserving more of this precious resource. Such measures are invaluable in areas like the desert southwest, which sees frequent droughts.
4. Become More Time Efficient
You’ve heard the cliché “time is money.” However, there’s truth to the saying — becoming more time-efficient can save you cash.
When employees need the company car to run errands, use apps such as Waze to detect the fastest route and avoid idling time in traffic. Employ productivity software not to micromanage what your remote employees do but rather challenge them to increase their output. Be sure to reward their performance — it need not cost much if anything. Allowing an early departure on Friday after hitting targets the rest of the week is an appropriate and free reward.
5. Invest in Training
Please don’t be one of those employers who dismisses their lowest-paid employees because they lack a fancy degree or experience. Rewarding your staff by promoting from within — after providing the appropriate on-the-job training — is one of the most surefire ways to ensure ongoing loyalty. Your most ambitious members will make something more of themselves regardless — why let them jump ship when they do?
You can save a surprising amount of money by training current staff for upper-level openings instead of recruiting. Even an $8 an hour position can cost $3,500 to fill, and replacing mid-level employees may ring in at a third of their annual salary.
6. Go Virtual
Telecommuting — whenever feasible — is another benefit that will save you oodles of cash. It could also inspire employee loyalty. Fully 30% of workers who began working-from-home during the pandemic said they would rather quit than return to 9 to 5 office grind.
The more employees you have working remotely, the greater your cost savings on office space and all the associated rent and utility bills. Plus, you’ll reap the rewards of improved productivity. The pandemic indicates it could create a 5% spike due to eliminating things like commute time.
Reduce Costs Without Sacrificing Employee Benefits
You don’t have to upset your dedicated staff by cutting their employee benefits to save on costs. You can slash the price of doing business using a few simple and creative methods while keeping your crew happy!