Make Loyalty Bloom

This country may be experiencing one of the toughest economic periods in recent decades. As a business owner, you know that doesn't mean less work for you. You're hustling to attract more customers, bending over backwards to keep the ones you have, and scrambling to keep up with day-to-day tasks. If you're lucky, you don't have to shoulder this extra work on your own because you have a team of hard-working employees. But here's the real question: In the absence of raises and bonuses, how long can you expect them to stick around? Sure, employees will stay with you while the job market is poor, but if they don't feel like you've treated them well during the slow economy, they'll move on to greener pastures when things turn around. That's why slowdowns are critical for building caring relationships.


Many small business owners wrongly assume that employees respond only to money. In cash-strapped times like this, it is important to go back to basics and remember that employees want the same things owners want: to be appreciated, to be respected, to have a chance to be all they can be, and to be part of something special. There are many great ways to keep up employee morale and build loyalty that can cost you next to nothing. You just have to pay attention to your employees' needs and be creative. Here are eight suggestions to help inspire loyalty among your staff:

1. Say "thank you."

It's so simple, it almost seems silly to mention, but just telling your employees "thank you" when they've done a great job will go a long way. Verbal recognition of the work they do will not only keep their morale up but it will also increase the mutual respect between you. As a result, they'll not only work hard but they'll also stick with you through thick and thin. This is such a simple thing to do and more business owners should really take advantage of it. Overworked entrepreneurs sometimes get the attitude that they're working hard so why shouldn't their employees? Well, if your employees don't feel appreciated, their hearts won't be in their work, even if they are putting in the face time. A sincere "job well done" is a small price to pay for that extra bit of effort that makes all the difference.

2. Give them inexpensive bonuses.

While money is tight, you can't give your employees significant raises or bonuses, but you can show your appreciation with other small, less pricey rewards. A few great options include a gift certificate to a local restaurant or tickets to a show or game. Alternately, consider giving them a Friday afternoon off with pay. These small thank yous allow you to tell your employees you appreciate them and care and show them that you think of them as more than just a way to make money.

3. Provide them with free meals.

The quickest way to your employees' hearts is through their stomachs. Providing a catered lunch once a month or doughnuts in the morning is a great way to keep up morale and say thanks. Also, don't forget to remember birthdays and anniversaries. Celebrate each of them with a small party (that includes cake!), and not only will your employees appreciate the recognition, but you'll also provide a great opportunity for everyone to get together and have an enjoyable time at work.

4. Award them.

You might want a better system than the embarrassing "Dundies" on the hit show The Office, but coming up with a way to award great work at your spa is a fun way to show your employees that you value their effort. Whether it's a simple blue ribbon or a framed certificate, present the award in front of your entire staff and tell them exactly why you are presenting it.

5. Write them a thank-you note.

Taking the time to write a short thank-you note to a hard-working employee is always well worth it. Let the note be a nice surprise for them by putting it in their mailbox at work or by mailing it to their home. And make it specific—"Thank you for staying late last Thursday to treat that last-minute client" is a lot more powerful than a vague "Thanks for all your hard work!"

6. Help them improve themselves.

Your employees appreciate it when you are willing to invest in their futures and help them widen their career horizons. You can do this by paying for them to attend a class at a local community college or a seminar that interests them. Let your employees decide whether the classes are work-related or not. If they are, great! You've paid for them to learn skills that will help them do their jobs better. If they aren't, that's great too, because you've likely helped them build on areas that will make them feel better about themselves, thus making them happier employees.

7. Help them get healthy.

Providing your employees with a gym membership can have multiple benefits. First of all, it's another great way for you to say thanks and help them improve their lives. You can probably get a group deal at your local gym so the cost to you won't be very significant, and their improved health will help you save on health insurance and paid sick days.

8. Ask them what they'd like to improve about the business.

One employee might suggest updated equipment or an interesting product line, while another might suggest a unique sales promotion. Either way, they will be changes that will help them do their jobs better. It will make them feel like they have some ownership in your spa. Plus, it can be hard for employees to leave when they feel that they have helped build your company into the great business it is. But remember, once you've asked your employees what they'd like to change, there's no turning back. You must take their suggestions seriously and show them you value their opinions by acting on some of them as quickly as possible.

While times are tough now, they will eventually improve. When all of this is over, you don't want your staff members looking back and thinking, "Man, I really worked hard for you when you needed me, and you never said thank you." Your employees want to do a great job for you. They want you to care. So show that you do. It's that simple.

Ed Hess is a professor of business administration and Batten Executive-in-Residence at the Darden School of Business at the University of Virginia where he teaches courses on building small businesses and organic growth. Charlie Goetz is a successful entrepreneur who has built several profitable businesses. Together, they wrote the recently released, So, You Want to Start a Business? 8 Steps to Take Before Making the Leap (FT Press, September 2008).