Should You Sweeten Your Benefits With Snack Foods?

For quite some time we've been reading that small business owners want to expand their teams, but are having a hard time finding the qualified candidates. So here's a question to consider: If the path to your small business is paved with snack foods, will desirable recruits start pounding at your door, wanting to get in?

An article in USA Today said that according to an informal survey by Peapod, free snacks are the key to employee happiness among some high tech firm employees -- ranking as the second most desirable non-traditional perk, right after game rooms.

Further, it seems that having a good assortment of free snacks handy is particularly important to Millennials, so if that's the demographic you need to bring on board, you may want to push "stock up on snacks" higher on your to-do list.

However, if you're planning to open your wallet and start satisfying your employees' hunger pangs, you need to know what you're getting into so you're ready for the problems that might arise.

Snack food snags

When I started to provide food at one of my companies, I quickly learned a lesson that all restaurant owners know: employees will walk out the back door with food and take it home with them. This is just a fact of life. You will experience "snack shrinkage." Of course, some employees leave with reams of paper and other small items, so this isn't really anything specific to snack foods.

Stacy Williams, who is the Director of Consumer Experience and Operations at her company, SERVIZ, makes a good observation that applies to many small businesses and startups.

"Buying snacks for the office can be tricky and if not done with care can end up alienating rather than motivating employees. Especially at a startup where there usually isn't an office manager dedicated to these things on the payroll yet," she explains.

When she started buying snacks for her team she asked for input, but this "quickly spun
out of control as I started getting too many individual requests for specific items no one else wanted and I noticed some things were running low too quickly which meant people were 'hoarding' them in their desks or taking food home," Stacy says.

She scaled back on the requests, noted dietary restrictions and eventually everyone settled into a routine.

Spoiled fruit

James Armstrong of Wooden Blinds Direct had similar hassles when they decided to start bringing in fresh fruit: "Initially it was a great success, but problems with the quality and selection of fruit soon emerged, and low level conflicts began around certain employees taking all the choice pieces for themselves."

They decided that it just wasn't worth the trouble and cancelled the order.

Something that's fundamental for everyone to understand is that the snacks aren't "free." Ultimately, the money comes from payroll as do all other benefits. And since we're on the topic of money, it's important to know when you can feed your crew without getting into trouble with the IRS.

Bringing Uncle Sam to the table

The IRS has two tests that must be met for meals to be excluded from income tax reporting requirements:

The meal must be served on the premises, and
The meal must be furnished for the convenience of the employer.

Rakini Chinery, who owns Allan's Flowers & More in Prescott, Arizona, highlights that second IRS requirement in their approach to offering snacks.

"I don't offer snacks all the time but I do stock snacks and drinks during our major holidays. I feel it is a great perk to offer my employees who are putting in a lot of extra hours. They love having the snacks available and I really believe it helps their production," Rakini explains.

What has your experience been with workplace snacks? Do they sweeten productivity or have you soured on the whole thing?