The basic definition of an employee discount is that the employees of a certain business get the goods or services that business offers for a lesser price than the one at which they are being sold to customers. Generally, this discount is offered by the employers to their employees as one of the fringe employee benefits.
Reasons for employee discounts
As a business owner, it’s important to remember that each of the employees is key to the ongoing success of your business. Making a determined effort to keep employees happy is valuable to your company in both the short and long run. Some companies, commonly retail outlets, offer employee discounts to their workers.
The temptation of a special discount on items from the company store is a perk that employers offer when hiring new employees. This perk, offered in combination with other employee benefits, helps make the employer’s recruitment efforts more successful.
Employers also incorporate discount programs for workers as a way to boost sales. Since an employee of the business commonly spends a substantial amount of time browsing and learning about the company’s products and services, he/she could end up becoming a dedicated customer.
The discount helps spur sales that may not have occurred otherwise for the business. For instance, if an employee of a retail store wants to purchase Christmas holiday gifts for their family, the significant discount may inspire them to get all of their gifts from their employer’s store instead of the competition.
If the employee buys and enjoys the products or services, he/she may also become a source of free advertising for the business. Even when the employees are not on duty their use of the company’s products could inspire their friends and family to visit the store. For example, if the employee of a telecommunication company chooses his employer’s service due to the discount and has a positive experience with the network coverage, he might recommend a friend to the company.
Employee recognition and morale
A significant employee discount on products and service can also lead to higher morale among the ranks. Offering a deep discount on products and service may make the recipient feel not only as a valued customer to the business but as an appreciated employee as well.