Business Up Front - September 2008

Business Up Front

Employers Enhance 401(k)s To Match Employee Demands

In a survey released by the Charles Schwab Corporation, companies are spending more to strengthen their 401(k) plans. The survey results show a trend in corporate America of adding features that increase savings such as automatic enrollment, increasing matching contributions, investment advice and additional investment options. Executives cited recruitment, retention and retirement assets as the motivations for improving and expanding their 401(k) plans. According to the Schwab survey of 208 executives, conducted by CFO Research Services:

• 84 percent agreed that a 401(k) plan is necessary for recruiting and retaining a high-quality workforce,

• 67 percent believe offering a 401(k) plan enhances a company’s corporate reputation,

• 58 percent said it contributes to a company’s long-term financial success, and

• 55 percent expect to devote even more resources to strengthening their plans in coming years.

As Trends Are Headed Down, Keeping Small Businesses Up

The tough economic climate means diminished opportunities, stagnant cash flow and narrower profit margins for small businesses. The United States Federation of Small Businesses (USFSB) recently released eight tips for small businesses trying to survive.

1. Track accounts receivable more closely – getting paid on-time must become a top priority.

2. Use technology efficiently. Look into Web-based accounting and postage software or introducing video conferencing to reduce expenses.

3. Boost sales while keeping costs flat. Charge for products or services previously given away for free or consider raising prices. Attempt to sell more to existing customers instead of prospecting new ones.

4. Smart marketing means using targeting email marketing and sprucing up the company Web site.

5. Remain visible. Stay in touch with your customers.

6. Inventory slumps? Have a sale to move obsolete inventory and examine the length of your holding cycle.

7. Employee productivity is crucial. Reduce the amount of employee trips outside the office.

8. Don’t cut the perks. Maintaining employee morale and confidence goes a long way.