By Marcus Leach

Findings show that UK small companies risk damaging staff morale by cutting back festive activities this year.

The research found that almost half (48%) of small to medium sized enterprises (SMEs) questioned are not planning a Christmas party this year and that 91% of businesses that are, will spend the same or less than last year. Despite this, 63% recognise that cutting back or cancelling Christmas parties damage staff morale, and therefore productivity.

Recent tough times were blamed for a decline in Christmas related activities over the past few years (41%). Of those intending to have a Christmas bash, the average spend per head will be £43.80.

The research also showed that a third of businesses (30%) are introducing new, leaner measures this year to make sure they run smoothly over Christmas. New initiatives planned involve having skeleton teams in place or key people on call 24/7, in an effort to run more efficiently but not shut down completely. On the other hand, 35% of SMEs will be closing for Christmas, believing their staff deserve a good rest.

SMEs are not entirely turning their back on tradition though, with nearly half of companies (48%) still planning on sending out Christmas cards, with a further 20% intending to send a mix of physical and digital cards. It is this integrated approach to communication that companies find generate the most business, with 27% saying that a combination of mail, email and web campaigns provide the most success compared to standalone channels**. Only 7% said they would just be sending e-cards.

“Controlling costs is always important, but staff Christmas parties are a valuable way of showing recognition and appreciation of your employees,” said Phil McCabe, Senior Policy Adviser at the Forum of Private Business, a leading small business body. “In turn, good employee engagement delivers bottom line results. Choosing not to recognise staff at Christmas could have a negative effect on morale and therefore productivity so companies need to introduce other ways of motivating — it doesn’t have to be costly.”

Commissioned by Pitney Bowes, the independent study was carried out by YourSayPays and questioned 500 small companies across the UK.

“Christmas is a great time to engage with staff and customers, especially when times are tough, and festive activities need not be expensive,” said Phil Hutchison, Pitney Bowes Tactical Marketing Director. “In place of parties, companies can try other ways of showing their appreciation, such as more flexible working, relaxed dress codes or setting time aside for activities such as a festive quiz.”

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