We hear Barista Magazine Online readers’ thoughts surrounding employee benefits, and whether or not café owners should provide them.
BY EMILY JOY MENESES
ONLINE EDITOR
Featured photo by Mike Gattorna
Welcome to part two of “Let’s Talk About: Employee Benefits,” a series we launched yesterday wherein we explore the pros and cons of café owners offering their team benefits such as health care and paid time off (PTO). In part one, we discussed the pros of providing benefits, such as boosting employee morale and productivity, retaining long-term skilled employees, and the positive financial impact of offering benefits, such as reducing hiring and training costs. Today, we’ll hear from more Barista Magazine Online readers about the possible challenges of offering employee benefits and how to mitigate them.
The Complications of Offering Employee Benefits
Challenge #1: Financial Constraints
Many cafés operate with slim profit margins, making offering employee benefits feel financially daunting. Small businesses face high overhead costs already, and adding health care or PTO could strain an already tight budget. For many café owners, the question of sustainability—can we afford these benefits long-term?—has the potential to become a major obstacle.
Challenge #2: Raising Prices
In order to afford benefits, cafés may need to increase menu prices, which could alienate some customers. Unlike larger corporations that can absorb costs over a large customer base, independent cafés must balance the risk of losing budget-conscious customers with the desire to offer benefits. Competing with chain cafés and coffee shops that don’t offer the same benefits, and therefore might have lower menu prices, may be difficult if customers prioritize price over ethical practices.
Café owners might consider full transparency with their customers, telling them via signage, social media, and face-to-face that they are increasing menu costs in order to offer benefits to their employees. This might actually increase customer loyalty, as many will appreciate the owner going to such lengths to take care of their employees.
Overcoming Challenges: Opening Lines of Communication
Many readers told us that even if offering benefits isn’t feasible for a shop at the moment, it can be encouraging to employees to know that it’s something their bosses care about and are working to achieve.
“(We) currently get dental (at the shop I work for), and they’re working on health care. Not sure about finances, but it makes a difference in morale for me to even know they’re trying to get health insurance,” says Barista Magazine Online reader @coralsun_shine. “I think if an employer can make it work financially, yes, they should try. If they’re serious about people staying for many years and being a professional for their business, part of ensuring the employees can stay is having health insurance, or being paid enough to pay for health insurance.”
Opening up a conversation between you and your team can also help you better understand which benefits are most important to them. For example, the team may appreciate paid time off over health care, if they’re able to qualify for free or low-cost health care programs outside of the café.
“I’ve worked at shops where they tried to get insurance but could only afford it if someone took a pay cut, because the business was too small to get good rates,” says Denver-based barista and writer Jess Carlan. “We spent a whole meeting discussing it and voted not to do it because most of us were eligible for Medicaid or would get better prices for individual plans on the Colorado marketplace.”
Upfront Cost Vs. Long-Term Cost
When considering employee benefits at your shop, it’s also important to consider how the upfront cost of offering benefits may save you money in the long run.
“We offer PTO, sick leave, 401K, and health care. We also offer free meals, drinks, and coffee beans,” writes the team at Retrograde Roasters, a green-certified specialty roaster and coffee shop based in Sebastopol, Calif. “The cost of training people constantly and low morale from high turnover/poor work environment is more than the cost of offering benefits.”
Ultimately, a one-size-fits-all approach is unlikely to work for every coffee shop. Café owners must consider their shops’ unique circumstances, goals, and the values of their customer base when deciding whether to implement employee benefits, and which ones to extend. By striking a balance between their own needs and their employees’, and working together with their team rather than in opposition, café owners can aim to create a workplace that is both supportive of employees and sustainable for the business.
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