Effective New Year Employee Retention Strategies Businesses can Use

Even before the collapse of Silicon Valley Bank or SVB, there was a tightening in the commercial credit market. Post-collapse, small businesses have found it increasingly more difficult to secure capital from traditional lenders. Still in need of cash infusions and lines of credit, small businesses are turning to alternative lenders. Advantages and Disadvantages of Borrowing from Alternative Small Business Lenders Alternative small business lenders are non-bank lenders that provide financing to small businesses. They offer a variety of loan products, including term loans, lines of credit, and equipment financing. Alternative lenders often have more flexible lending criteria than traditional banks, making them a good option for small businesses that may be turned down for a loan from a traditional lender. Of course, even though all of this sounds good, there are reasons small businesses have historically relied on traditional lenders. This is due to the fact that there are not only upsides but also, downsides to using an alternative lender. So, let’s take a look at the pros and cons of borrowing from alternative lenders. Pros of Borrowing from Alternative Lenders Faster approval and funding. Alternative lenders often have a streamlined application process that can be completed online or over the phone. This can lead to faster approval and funding, which can be critical for businesses that need money quickly. More flexible terms. Alternative lenders may be more willing to work with businesses that have less-than-perfect credit or that are in the early stages of growth. They may also be more willing to offer loans with longer terms or lower interest rates. More options. Alternative lenders offer a wider variety of loan products than traditional banks. This includes term loans, lines of credit, and merchant cash advances. No personal guarantee required. Some alternative lenders do not require a personal guarantee from the business owner. This means that the business owner’s personal assets are not at risk if the loan is not repaid. Although these are some quite compelling reasons to seek out capital from an alternative lender, there are also a few considerations you should take into account so you have a better understanding of how these lenders work. Cons of Borrowing from Alternative Lenders Higher interest rates. Alternative lenders typically charge higher interest rates than traditional banks. This is because they are taking on more risk by lending to businesses that may not be as creditworthy. Shorter terms. Alternative lenders often offer loans with shorter terms than traditional banks. This means that the business owner will have to make larger payments over a shorter period of time. Hidden fees. Some alternative lenders charge hidden fees, such as origination fees or prepayment penalties. These fees can add to the overall cost of the loan. Less customer service. Alternative lenders may have less customer service than traditional banks. This can make it difficult to get help if you have questions or problems with your loan. Now you have a better idea of what to expect from alternative lenders, you are more informed about your options and this will give you additional choices. Taking it a step further, you should also consider the following if you are in need of a line of credit or some operating capital. When to Borrow from an Alternative Lender Alternative lenders can be a good option for small businesses that need money quickly, have less-than-perfect credit, or are in their early stages of growth. However, it is important to carefully consider the pros and cons before choosing an alternative lender. If you are considering borrowing from an alternative lender, be sure to shop around and compare rates and terms from multiple lenders. You should also read the fine print carefully to understand all of the fees and conditions associated with the loan. Interested in learning more about business? Then just visit Waters Business Consulting Group to learn more about us and the services we offer.

When the new year arrives in earnest, some employers will be taken by surprise when a few employees announce they’re leaving their companies. The reasons for this are many, but there are some which are far more common than others. So, it’s critical for business owners and managers to know these motivations to address any shortfalls right away. Plus, how to proactively retain talent so productive individuals don’t leave. Common Reasons Employees Leave Companies There are a number of common reasons that employees leave companies, and understanding these reasons can be important for businesses looking to retain top talent and maintain a healthy and productive workforce. One major factor is the need for career advancement opportunities. Many employees are looking for opportunities to grow and advance within a company. If they feel like they are hitting a dead end or there are no clear paths for advancement, they may look elsewhere for opportunities that allow them to continue to grow and develop. Poor management is also a big reason. Employees want to work for leaders who are fair, supportive, and transparent. If they feel like they are being micromanaged, or if they are not receiving clear direction or support from their manager, they may start looking for a new job where they feel like they are valued and supported. Additionally, a poor work-life balance can play a role. A demanding or inflexible work schedule can be a major turn-off for employees, especially if it is causing them to feel burnt out or like they are unable to attend to other important aspects of their lives. Maximizing employee retention is one of the best ways to make sure your small business thrives. Unfortunately, staying fully staffed can be challenging in today’s business environment. According to Bank of America’s 2022 Small Business Owner Report, 41% of small businesses say labor shortages are currently impacting their businesses. —Bank of America Small Business Lack of recognition or appreciation is most definitely the cause of team members leaving companies. Employees want to feel like their hard work is being noticed and appreciated. If they feel they are being taken for granted or not receiving adequate recognition or praise, they may start looking for a company where their contributions are clearly more valued. Unsurprisingly, poor compensation and benefits are big ones. While salary is not the only factor that motivates employees, it is an important one. If employees feel like they are being underpaid or not receiving competitive benefits, they may start looking for a company that compensates them with higher pay and/or benefits. Last but not least, a negative company culture. A toxic or unhealthy company culture can be a major deterrent for employees. If they feel like they are not a good fit with the company’s values or culture, or if they are experiencing harassment or discrimination, they may decide to leave in search of a more positive work environment. So, it’s important for businesses to understand the common reasons that employees leave and to make an effort to address these issues in order to retain top talent and maintain a productive and satisfied workforce. How Businesses can Retain their Employees Retaining top employees is important for businesses of all sizes, as it can help to reduce costs associated with hiring and training new employees, as well as improve overall productivity and morale. Here are some strategies that businesses can use to encourage team members to stay: Offer competitive compensation and benefits. Employees want to feel like they are being fairly compensated for their hard work. Offering competitive salaries, bonuses, and benefits can help to keep employees satisfied and motivated to stay with a company. Foster a positive company culture. A positive company culture can be a major factor in employee retention. Creating a culture that is respectful and supportive can help employees feel more invested in their work and more likely to stay with a company. Provide opportunities for career advancement. Employees want to feel like they are growing and developing within a company. Offering opportunities for advancement, such as training and development programs, can help to keep employees motivated and engaged. Encourage work-life balance. A demanding or inflexible work schedule can be a major turn-off for employees. Encouraging a healthy work-life balance, such as through flexible scheduling, hybrid, or WFH options, can help to keep employees satisfied and less likely to look for new opportunities. Show appreciation and recognition. Employees want to feel like their hard work is being noticed and appreciated. Regularly thanking and recognizing employees for their contributions can help to build a positive and supportive work environment that encourages employees to stay on board. Foster open and transparent communication. Employees want to feel like they are in the loop and that their opinions are valued. Encouraging open and transparent communication, such as through regular check-ins and feedback sessions, can help employees feel more connected to the company and more likely to stay. Overall, the key to retaining employees is to create a supportive and positive work environment that recognizes and values their contributions. By implementing these strategies, businesses can encourage team members to stay and foster a productive and satisfied workforce. How else can businesses prevent employees from leaving or proactively encourage them to stay? Please feel free to share your thoughts and experience so others can benefit! Interested in learning more about business? Then just visit Waters Business Consulting Group.

Promoting an employee is a big decision, and it’s important to make sure that the person you’re promoting is actually ready for the next level. Fortunately, there are a number of signs that can indicate that an employee is not yet ready for a promotion, even if they’re doing a good job in their current role. Signs an Employee is Not Actually Ready for a Promotion Promotions are an essential part of career growth and employee development within any organization. They serve as recognition for hard work, dedication, and competency in one’s current role. However, not all employees are ready to take a step up, despite their desire for advancement. As an employer, it is crucial to assess each team member carefully to ensure that they are adequately prepared for the increased responsibilities and challenges that come with a higher position. Here are some of the most common signs that an employee is not ready for a promotion: They’re not consistently meeting performance expectations. This is probably the most obvious sign that someone is not ready for a promotion. If they’re not consistently meeting the expectations of their current role, they’re not likely to be successful in a more senior role. They’re not taking on new challenges. If an employee is content to stay in their comfort zone and not take on new challenges, they’re not likely to be ready for a promotion. A promotion means taking on more responsibility and facing new challenges, and if an employee is not up for that, they’re not ready for an upward move. They have difficulty acting as a team player. A promotion often means having more responsibility for managing and motivating other people. If an employee is not a solid team player and doesn’t have the skills to motivate and lead others, they’re not ready for a promotion. They’re not eager to learn new things. The world of work is constantly changing, and in order to be successful, employees need to be willing to learn new things. If an employee is not excited to learn new things, they’re not likely to be successful in a more senior role. They’re not able to handle stress well. Senior roles often come with more stress and responsibility. If an employee is not able to handle stress well, they’re not likely to be successful in a more senior role. If you see any of these signs in an employee, it’s important to have a conversation with them about their readiness for a promotion. Explain to them what you’re seeing and why you don’t think they’re ready for a promotion yet. Help them identify what they need to do to improve their skills and knowledge so that they can be successful in a more senior role. Other Considerations Business Owners Need to Take into Account It’s also important to remember that not everyone is cut out for management. Some people are perfectly happy to stay in their current role and not have more responsibility. If that’s the case, there’s no need to force them into a promotion that they’re not ready for. Promotion is a great way to recognize and reward employees for their hard work. However, it’s important to make sure that the person you’re promoting is really ready to climb up the ladder. By looking for the signs listed above, you can help ensure that your promotions are successful. Now, here are some additional tips for identifying employees who are not yet ready for a promotion: Pay attention to their performance reviews. If an employee has consistently received negative reviews, they’re probably not ready for a promotion. Talk to their manager. Their manager will be able to give you a good sense of their overall performance and whether they’re ready for a promotion. Observe them in action. Pay attention to how they interact with their colleagues, how they handle stress, and how they take on new challenges. Promoting an employee prematurely can be detrimental to both the individual and the organization. Employers must carefully assess each team member’s readiness for a promotion by looking for signs of technical proficiency, effective time management, initiative, teamwork, and the ability to handle current responsibilities. By offering support, training, and guidance to employees who exhibit potential, employers can better prepare them for future roles and foster a more successful and motivated workforce. Interested in learning more about business? Then just visit Waters Business Consulting Group to learn more about us and the services we offer.