It’s usually bad news when your top talent walks out the door. That’s why any good employer understands that attracting and retaining good employees is important for maintaining a strong organization and work culture, because it’s the first step to building a team that will accomplish great work for your business.

It takes a combination of solid leadership and compelling incentives to help your small business attract and retain top talent.

Here are 5 tips for attracting and retaining the best people for your business:

1. Money is never secondary

Despite how much you might think you’re spending on employees, chances are you’ll end up spending more money replacing them if they leave. The average cost of a bad hire is at least 30% of the employee’s first year earnings. As the job market continues to tighten, employees are more aware than ever about fair compensation packages. Pay your employees at or above market level to foster a culture of long-term growth and value to the your business. “It’s important to appropriately pay and incentivize financially,” said Earle Lerner, President of Stewart Staffing Solutions. “People want to enjoy their work, but they’d like to get paid as well.”

2. Communicate openly with your team

Don’t be afraid to make mistakes and admit them. While you must have a clear business plan in place, it’s also important to be nimble and be prepared to pivot to another path. Communicating your mistakes demonstrates to your team that you’re not only their leader, but their teammate and partner as well. By allowing yourself to be open, your employees will feel comfortable to come to you with their thoughts and concerns.

3. Be transparent and consistent in your rewards

You’ll need to have guidelines and expectations for rewards that are consistent, transparent, and accessible to everyone in the company if you want your employees to strive to do their best work. Create a rewards system by consistently praising or giving personalized gifts to your most dedicated employees. One-off rewards can send the wrong message to the entire team and stir resentment, so be sure to clearly communicate that recognition and rewards are open to anyone willing to work for it.

4. Provide opportunities for growth

Most of your employees are probably looking to advance their careers. If your employees feels that they are unable to progress in their career development, they’ll most likely start searching for better opportunities. Ask each of your employees about their long term career goals and think of manageable ways to help them. Some businesses compensate their employees for continued education training or reimburse their travel expenses to industry events.

5. Make it about the culture

Establishing a friendly work culture can make a world of a difference for employees. At Bluevine, we have a bi-weekly Beer and Banter, which is a designated time for new employees to introduce themselves and when current employees share updates about their projects over ice-cold beverages. Think of creative ways to build your team bond like hosting weekly happy hours or encouraging your employees to participate in a company sports team after work. Creating a unique and healthy company culture will keep your employees coming back day after day.

If you want to attract talented employees to your business, retaining your best employees is key. Promoting a healthy work culture, providing competitive benefits, and maintaining open channels of communication is just the tip of the iceberg of what you should be doing as an employer. As your business continues to grow, you should always be thinking of new ways to keep your employees motivated to do their best work.

This article was first published on Oct. 17, 2014. It was updated on April 9, 2018.

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This content is for educational purposes only and should not be construed as professional advice of any type, such as financial, legal, tax, or accounting advice. This content does not necessarily state or reflect the views of Bluevine or its partners. Please consult with an expert if you need specific advice for your business. For information about Bluevine products and services, please visit the Bluevine FAQ page.