Strategies to tackle 4 year-end small business challenges

For small businesses, the holidays can often mark the start of the craziest time of the year. Rushing orders, increased sales, and staff shortages can present challenges, all of which affect the bottom line.

While the holiday season is usually filled with twinkling lights, special celebrations and high spirits, small businesses face several unique challenges. These challenges are not holiday specific, but the demand for goods, services, travel and accommodation increases exponentially during the holiday months, meaning these challenges are increasing more than ever for small businesses.

Visits to family and friends, large meals and gift exchanges lead to an increase in market demand. While large companies face similar challenges year-round, planning to ramp up production or hiring seasonal staff is very different for small companies and even critical to business success. knowledge the challenges is essential to make plans, face them and overcome them. That’s why SPARK is recaping an on-demand webinar hosted by ADP where the experts will discuss this topic: Small Business at Work Fall 2022 Outlook: Preparing for a Changing Landscape. Based on research conducted among ADP’s small business clients, expert Julie Arzonico – Senior Director of Market Insights at ADP – discussed trends and challenges.

Consider the following guide as you take on these four challenges, even though they’re compounded by the hustle and bustle of the holidays:

How do I find qualified employees?

Attracting talent continues to pose challenges for small businesses in the current job market. “Finding qualified employees was overwhelmingly the biggest challenge faced by our customers,” says expert Julie Arzonico. This was named as the top challenge in ADP’s recent customer survey. And of course, this challenge has an even more profound impact on small businesses struggling to cope with the holiday rush. Whether it’s barista staff at a local coffee shop or salespeople at a furniture store, a staff shortage not only puts stress on other workers trying to fill the gap, it also impacts the bottom line. However, there are a few things small businesses can do to attract workers. Be sure to list vacancies on platforms that are heavily frequented by job seekers. Also, if possible, offer benefits that job seekers value. The research found that things like flexible working hours and special bonuses are two of the incentives that small business customers find most important in attracting new employees.

How do I keep my employees?

Another leading challenge for small businesses is employee retention. As many business owners have learned firsthand, since the COVID-19 pandemic, employee retention has been a challenge like no other. This trend shows no signs of reversing and the furlough rush will only serve to increase the need to keep staff on board. All entrepreneurs know the value of employee retention – from maintaining morale to the impact on profit margins. As you consider employee retention this holiday season, consider what Julie Arzonico shared when researching the topic: “Special bonuses and higher salaries are seen as the most important thing you can offer employees to make them stay.” You can too Using things like career development opportunities to motivate employees and get them to work.

How is the economy?

The economy has been a source of stress for many business owners, as rising inflation has forced many to raise prices or take on more work to offset falling margins. Thirty-five percent of small business customers surveyed said the economy is a major challenge for them. It’s everything from increased commodity prices, production costs and delays to supply chain disruptions and reduced cash flow. As you might imagine, these economic issues have the potential to affect small businesses more profoundly than larger companies.

While the economy may not be the biggest challenge for small businesses this season, it does come with some of the most commonly cited challenges like finding and retaining employees. Julie Arzonico says: “We know that 35 percent of our [small business] Segment shows that the economy is a big challenge for them. And now we’re seeing uncertainty about the economy impacting their hiring plans.”

When companies tighten their budgets to accommodate the changing economy, then having leeway to hire or providing additional incentives for existing employees may not be an option. But not all incentives are monetary.

How do I deal with employee absences?

Absenteeism has been a problem since the start of the COVID-19 pandemic. The ADP customer survey shows some business owners are struggling with this. While it’s not as hot a topic as recruitment or retention, it’s still a point to consider when evaluating overall employee engagement, which as many business owners know impacts the organization. Employee absenteeism can increase in the small business space because the numbers and margins vary. The absence of one or two employees during the week can severely impact the bottom line for a small company, while for a larger company it can cause inconvenience, but there may still be enough employees to cover the shift or meet performance demands .

Some suspicious absenteeism is due to a quest for greater flexibility at work and the need to care for children or the elderly. Expert Julie Arzonico shared what the research suggests, which is that absenteeism can be tackled by creating more support for employees by increasing work flexibility as much as possible: “The prevailing way of dealing with it when what she is handling is offering flexible working hours and schedules.” This will allow small businesses to accommodate the personal and family needs of employees while building a supportive relationship that lends itself to employee retention and consistency.

The abstract

If you’re a business owner, devising a plan to address these small business challenges could be a game changer for you and your business. While these challenges are not new, the holiday season will amplify them.

Start the webinar here: Small Business at Work Fall 2022 Outlook: Preparing for a Changing Landscape.

Tags: Salary and Wages People Planning Talent Management Small Business HR Articles People Management and Growth Business Owners Employee Engagement and Productivity Incentive Programs Revenue and Retention

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