Karlie Cremlin is the Managing Director of DLPA and a workplace culture and business strategy specialist. In this piece, she explains how businesses on a tight budget can keep employees happy.
As we step into 2025, the financial strain on Australian small businesses is undeniable. According to the latest ScotPac SME Growth Index Report, nearly 30 per cent of SMEs admit they are at risk of going bust if they lose a major client, while insolvencies are hitting their highest levels since 2020. It’s no wonder many business owners are focusing on cost-cutting to stay afloat.
In a tough market, cutting team learning and development, perks, and other discretionary ‘fun’ from your budget might seem like an obvious solution. It’s easy to justify saying goodbye to that team getaway or morale-boosting activity when the business is heading into the red. But while trimming expenses is often necessary, cutting initiatives that build morale can be a costly mistake in the long run.
Businesses that get stuck on ‘cost-cutting’ and focusing on the negative aspects of the economy tend to be less innovative and have lower engagement. As a result, it can often cost more to re-engage their workforce when the market starts to shift.
Even if you’re a solopreneur or running a business with a skeleton crew, fostering a positive work environment can help you weather tough times and position you to thrive when conditions improve.
Knowledge sharing
The good news is that there are several ways to keep morale high without breaking the bank. One of the simplest and most cost-effective ways to support professional development and boost morale is through knowledge sharing.
For businesses with small teams, this could involve skill swaps, where team members with complementary skills are paired up for regular learning sessions. For solopreneurs, consider joining industry forums or networking groups where you can exchange insights with peers. It’s a win-win: you’ll gain new perspectives and feel more connected to your industry.
Rethinking flexibility
Flexible work arrangements are low-cost and high-reward, meaning they should be a no-brainer for business owners looking to maximise morale on a budget. Fortunately, this doesn’t mean overhauling your business model entirely – greater flexibility can be achieved through making small, consistent tweaks to the way your business operates.
Allowing team members to start earlier or finish later to accommodate personal commitments won’t cost anything to your business, and can actually improve productivity through boosted morale and a sense of mutual respect.
Even if your business requires physical presence, occasional remote work for tasks like planning or training can be a welcome change. During quieter periods, let employees focus on projects that align with their interests and strengths. This not only boosts morale but often leads to fresh ideas and innovation.
For solopreneurs, flexibility could mean reevaluating your own schedule to prioritise tasks that energise you. Burnout is a significant risk when you’re wearing all the hats in a business, so giving yourself room to recharge is vital.
Engage with your team (or yourself!)
If you are looking to invest in a new learning and development program in the new year, first take a step back and look at what you’ve already got at your disposal. Create an inventory of the assets you already have – whether that’s knowledge sharing, peer groups, or drip-feed learning programs – and directly ask your workforce about which initiatives they find the most beneficial.
For solopreneurs, investing in your learning and development is just as important as scaling your business. Before diving into new programs for the new year, take a moment to reflect on what’s already working for you.
Start by creating an inventory of your current tools and methods – think online courses, industry memberships, books, podcasts, or mastermind groups. Then, evaluate which has had the greatest impact on your growth. Ask yourself: what has helped me achieve real results? Where am I still struggling?
Armed with this insight, you can design a tailored, cost-effective calendar of initiatives that maximises impact and gets everyone (or just you!) excited for the year ahead.
Acknowledge hard work
Acknowledging hard work doesn’t need to involve expensive gifts or bonuses. Regular and meaningful recognition can be even more impactful when it’s genuine and tied to specific achievements in real-time. Whether it’s a successful client pitch or resolving a tricky issue, focus on building a culture that calls out achievements as they happen. A heartfelt “thank you” in person or over email can go a long way and costs nothing.
Solopreneurs can adopt these practices by acknowledging their own milestones and progress. Celebrating your wins – big or small – reinforces your sense of accomplishment and keeps your motivation high.
Shift your mindset
Finally, the most cost-effective strategy of all: mindset. Businesses that focus solely on survival often find themselves stuck in a cycle of negativity, which can stifle creativity and engagement. Instead, frame challenges as opportunities. Economic downturns can be a chance to streamline processes, build stronger relationships with customers, or develop new offerings.
Tough times don’t last, but tough teams do. As you plan for the year ahead, consider what small steps you can take today to build a motivated and resilient team or solopreneur mindset. A little creativity and care can go a long way, without blowing the budget.
