How Do I Know How Much To Spend On Business Gifts?

How Do I Know How Much To Spend On Business Gifts?

First off, I want to flip-flop your mindset. You're not spending money on giftsYou are investing back into your peopleThe people who have made your business what it is today. The people who, without them, you'd be out of a job. Invest back into them; show them how much you appreciate and value them, and they'll go above and beyond to make sure your business is known and succeeds.

So, whether you've given gifts through your business in the past, or not, it can be tough to know if you're budgeting correctly. While I wish I could give you a magic equation that told you exactly how much you should set aside, I can't. It all depends on your business model, your values, margins, etc. However, generally speaking, you should figure that 3-5% of your net profits should be invested back into your VIP's. This 3-5% can be figured per project, or it can be figured at the end/beginning of each fiscal year.

If the only VIP's you have in your business are clients (a.k.a. you don't have employees and don't work with subcontractors/vendors/etc.), then figure up an amount per project to give back to them.

For example: If you're a photographer and you net $3000 on a session, you should be looking to invest $90-$150 back into the client.

If you have a variety of VIP's to give gifts to, then figure up your net profits for the previous year, and put 3-5% of that towards your people.

For example: If you net $100,000 last year, your budget for gifting this year should be $3000-$5000.

And once you've set that budget, stick to it. It can be so easy to want to just keep that money in the bank. But remember, you're not giving gifts, you're investing back into your people.

And if you're afraid you'll forget to give gifts, you won't have time or you'll be too tempted to keep that money for yourself, hire a gifting company *cough cough* to keep you on track and do the work for you.

OK, that's all I have for this blog post. I will talk more in future posts about how to break down your gifting budget so it has the best impact it can on your VIP's.

Happy gifting,

- Kelsey