Q&A: What kink of discounts to give employees?

Hi, Opening coffee cafe in Health Club, (Independent of club), but there employees want me to give them Discounts.
Not sure on what to give them and how often?? 20%? and then if each individual purchases say 10 meals they get one free worth $ 5??? or every month they get one free after purchasing during the month?
Also there is an Independent Hair Salon/Spa and they want me to supply their coffee. They say they will give me free Hair cuts. (I don’t need them, my daughter is a hair stylist) and if I supply them 2 to 4 airpots a day that equals 50 plus cups coffee a day. This does not equal a hair cut right? maybe a pedicure and a massage and what ever eles, but then I have to leave the tips too? HELP
discount coffee supplies.

latj:Business is business. Your first rule of hand in owning a business is profit. Then you can worry about what you can do for others. You have to take care of your employees and then they will take care of you. As far as others in the same facility, don’t do favors that don’t pay off. Remember why you went into business for yourself in the beginning. TO MAKE MONEY!!! Bottom line…..profit.

Tall:week off a year with pay some companys goes that route

sdn90036:You want everyone to be happy. This is a difficult situation.

First, you need to have a general idea how much your meals cost and what your profit margins are.

I’d keep it as simple as possible. I sure wouldn’t want to track how many meals a person purchases and then give them a free one. This is just hard to do.

You want it to be a win / win situation for everyone. You want their employees to receive a generous discount and you also want to make money out of it.

The hair salon is very simple. Tell that you will be happy to barter with them. Keep track of everything you give the hair salon staff. Then, insist on being able to “cash in” the credits the hair salon employees charge at your coffee cafe. This is only fair. If you give the hair salon / spa $ 400 in coffee and meals, you should be able to receive $ 400 in hair cuts, massages, etc. This is only fair.

You have to be careful, you have to earn a living. You can’t earn a living if you give everything away.

Good luck.

weregunnafight:You can do 50% off up to a certain price.
You can do 50% off only on the day they work.
You can do 20% off whenever
You can do 10% off of whenever they come and even if they are with a some people.

rayt721:Right now you need the profits so unless offering the discount will bring you substantial volume of sales that you would not get otherwise, don’t offer something that you may have to recind down the road. If they are bringing you massive amounts of business then consider a discount as incentive but your loyalty needs to be to your business, not theirs.

ed:If you decide to provide perks, such as coffee, this must be included in your operating expense. It can’t be an open ended amount. You might consider a limit with “donations” above that.

As for discounts, the percentage should not be an amount that creates a loss, less than your break even point.
You will not succeed if you try to operate at your break even.

As for trade outs, bear in mind that you would be offering not only free equipment and labor, but free merchandise, “coffee & cups”, that costs more than time, “money”.
Their trade is time only to a great extent.

If you are offering excessive discounts to others, who are not your own employees, I see trouble for your success.

Do what most retailers do these days.
Kick up the prices sky high and discount 50-80 percent. It’s all a sham. (Not really a reccommendation).

A free offering, based on purchases sounds ok. Just be aware of all your operating expenses.