The truth is cost cutting, especially when it impacts the payroll, can often have negative side effects on employee morale. As American Express’ OPEN Forum blogger, Darren Dahl, writes, “While you might succeed in adding a few dollars to the bottom line, you might actually suffer a net loss in the productivity of your employees.” Below are a couple methods to help both your business and its staff with the ultimate goal, making money and keeping morale high:

1) Ask for ideas. Don’t overlook your most valuable assets, your employees. They not only have first hand knowledge of the processes to help point out areas of waste, but can also provide you with innovative insight about your customers as they interact with them, learning about their needs and what might be missing in fulfilling those needs. As Marla Gottschalk, Ph.D., a practice manager with organizational development firm Rand Gottschalk & Associates, admits, “It can take some planning to create a channel of communication where employee ideas on cutting costs can be brought up, but when it’s done well, great rewards follow.”

2) Lay people on, not off. Laying off employees will only have the rest of your staff fearful of losing their job, or they may leave before being asked, leaving you understaffed and even less capable of making sales. Instead, ask employees if they would volunteer some extra time to help the store out, especially if you are considering increasing store hours to compete with late night and all weekend, big box retailers. While you may not be able to offer them their typical hourly rate, or anything at all, once the extra work shows some turnaround in the bottom line, perhaps there could be a bonus down the road. Once again, it is all about communication.

One thing is for certain; hardworking loyal employees cannot be taken for granted, even if your cash register is a little drier than in previous years. As the store owner and their employer, you should make the effort to recognize the efforts of those employees who continue to keep the storefront going. As Roy Saunderson, president of the Recognition Management Institute, says, “What employees won’t forget is how managers treated them during the tough times. That means you should be increasing the amount of time spent one on one with employees, writing appreciation notes, listening to concerns and thanking them,” and most importantly, cutting costs elsewhere.

1. Measure everything. Wasteful marketing can be a real drain on a businesses’ budget. Before you start any type of marketing, set up a system in which you can measure the success or failure of each marketing strategy and tactic.
2. Have a good lead generation system. Never in the history of marketing have there been so many ways to attract customers to a website or store front. The trick is to sort through the clutter to find what works for your business and your customers. By knowing your customers, you’ll know exactly in which medium your business should advertise. Every business that struggles to find customers does so for at least one of these six reasons. This book was written to give business owners a practical guide to a successful marketing system.
3. Know your customers. Building a marketing system without knowing your customers is like building a house on marshland. It will collapse immediately. Knowing your customers will allow you to determine how best to get your potential customers attention. Get out of the office and interview them. Find out what problems they have, what magazines they read, which websites they frequent. If you bury yourself in their world, you will build the foundation for a successful marketing campaign.
4. Compete on value, not price. Too many business owners think that consumers simply want the lowest priced product or service. Once you find what your customers’ value, then you can charge a premium for it.
5. Speak about your customer’s problems, not your products. Often, business owners build an entire marketing system around the product specifications. For instance, the website and brochure will speak endlessly about how fast a signal processor is, or how much data a product can store. Instead, these brochures should speak about the customers problems and how you, as a business owner, can solve them.
6. Offer multiple products for multiple customers. Not all customers are the same. Some customers may want an introductory offer, while others can’t wait to tell their friends about you. By treating every customer the same, you are doing a disservice to your business and your customer.