5 Ways Your Employees May Be Costing You Money
Every small business needs to conserve capital and run its operations efficiently. Once you have employees, you have less direct control over your company and need to rely on a well-trained, efficient workforce. Although most employees are hard-working and align their interests with yours, some may take advantage of their positions and end up costing you money.
Here are five areas in which your employees may be bleeding you dry.
1. Office supplies — Every employee, at one time or another, has ended up with an office pen or pad of sticky notes at home. This isn’t surprising, especially if your employees complete tasks remotely. But when printer cartridges, staplers, and calculators start disappearing, the outflow can really add up. Short of turning your supply room into Fort Knox, it is unlikely that you will prevent theft completely, but a sign-out sheet system for office supplies can serve as a deterrent.
2. Long-distance calls — Many large corporations track long-distance charges with employee-specific telephone codes, whereas smaller organizations typically rely on the honor code. It may be tempting for employees to use the company’s “free” long-distance service for personal calls rather than paying for them at home. As with any other invoice your company receives, you should review the telephone bill monthly and make sure that you can validate the long distance and other charges on the account.
3. Personal time online — The internet can be a powerful tool for business and it's understandable that it will be used for personal activities at the office, too, to some extent. However, if your employees go online during work hours for personal purposes, you are basically paying them to engage in recreational activities. Some companies handle the situation by blocking certain social websites, but there are ways for employees to get around this. To minimize subsidizing your employees’ surfing time, set a clear written internet use policy, which should allow employees to use the web on their breaks but minimize personal internet time otherwise.
4. Sick days — Some studies suggest that up to one-third of all sick days are taken by employees who are not ill. Employees are more likely to take a sick day when healthy if they feel they have to “use them or lose them.” To avoid this, allow sick days to roll over into the next year. Set a policy that any absence over a certain number of days must involve a doctor’s note. But above all, create a challenging, inspired workplace that employees will love working in every day.
5. Inventory shrinkage — If you sell physical goods, whether you manufacture or resell them, you know the importance of inventory control. Employee theft can be a serious issue in companies that do not have procedures and processes in place to protect their inventory. Theft can be as minor as an employee taking a pack of gum from your convenience store or as serious as employees walking out with computer parts under their coats. Performing regular inventory counts will help identify ongoing shrinkage. To prevent large thefts that are covered up, separate the functions of custody of the inventory from accounting for the inventory.
As a small-business owner, you don’t want to have to think about your employees costing your business money above and beyond their wages. Setting clear policies and protecting your assets can help the relationship remain productive.