Business Gift Giving
Business gift giving has been an aspect of doing business for centuries. Sources show that there has been an increase in business gift giving due to the fact that more business people are appreciative of the tradition’s value than ever before. It is a way to improve relationships, acknowledge excellence, and impart a sense of connection, if it is done properly. If it is done properly is an important point. This is where gift giving etiquette comes into play. Common sense rules.
Some of this is very plain to see, but will be mentioned here anyways. First of all, always wrap your gift. One not wrapped can convey a sense of carelessness.
Secondly, try to avoid having your company name noticeably displayed on the gift you are giving since this is can be viewed as commercialism and is not appreciated during this season. Do be sure, however, to include your name on the gift card. You will be favorably remembered this way. Also, steer away from overly expensive gifts since they can either make the recipient uncomfortable or be viewed as a form of bribery. However, if your business associate is a multi-million dollar athlete, this writer is not sure what an overly expensive gift would be.
Various points to remember in the gift giving process include the following areas:
� Budget. Determine how much you can spend and divide this by the number of people you are interested in giving to. This will give you an idea of how much to spend per gift.
âÂ?¢ Objective. What are you expecting to accomplish or achieve with your gift? Be it practical, emotional, or simply to leave a lasting impression…decide what’s important to you.
� Presentation. Just a little flair will give the sentiment of sincerity.
� Thoughtfulness. A gift that was specially chosen for your associate will be much appreciated. A great way to keep track of this is to maintain a file on all your clients whereby you note their likes and dislikes, hobbies, personal info.
� Personalization. Having their name put on the gift shows them that you view them as being special.
âÂ?¢ Scheduling/Timing. It goes without saying to make sure to allow enough time for deliveries, ordering, and the creation of the gifts. Plan in advance since last minute rushes can cause mistakes. A gift received first thing in the morning, and placed on your dad’s (or associates) desk is sure to be remembered. Or, if you like the face-to-face encounter, schedule a surprise short meeting with him. Give your gift then. It is sure to stand out from the rest and be remembered for a long time. After you have given thought to how and when you are going to present your gift, you are going to want to decide what type of gift you want to give.
There are the “traditional” gifts, activity gifts, experience gifts, and the consumable gifts.Traditional gifts are those everyone thinks of when thinking about business gifts. Pen and pencil sets, pen holders, paperweights, etc. Nothing out of the ordinary here. Activity gifts consist of those gifts where your recipient partakes in, or is a spectator of, some activity such as going to a sporting event. The experience gift category is where your recipient is given an experience to enrich themselves such as a day at a spa. As you can see, activity and experience gift categories can sometimes cross. And last, but not least, is the consumable gift category.
Of course, this involves gifts that are edible. Depending on the nature of the presentation, this gift category is known to be the least memorable. How many cheese and sausage baskets can one receive? Then again, a handmade gift basket consisting of your dad’s favorite cheese and sausage items would be most welcomed. Presentation is important in this category since it will make the gift memorable. Just as an example, one Father’s Day in order to make their cheese and sausage baskets memorable, the office pitched together to have the cheese formed into golf balls. They knew there boss was a golf fantatic. It is not easy to forget golf ball shaped cheese, wouldn’t you agree? Also, be certain your recipient has no dietary restrictions (such as diabetes) or else instead of receiving an enthusiastic “thank you!” upon giving a basket of Godiva chocolates, you will walk away wondering why you received a look similar to that of a deer looking into headlights!
Let us turn to the classification and taxability of gifts for some more excitement. The IRS allows $25 per business gift per recipient (last time I checked, anyways). And if you and your spouse give gifts, it is considered a joint gift (treated as one taxpayer). It does not matter whether you have separate businesses or independent connections with the recipient. That is a direct quote from Pub. 463, Ch. 3 “Business Gift Expense.” For corporations giving gifts over $25, the difference would be treated as a reconciling item between your book income and taxable income. It’s considered a reconciling item since it’s reflected totally in your financial statements, but only limited to the $25 on your tax return. For partnerships or sole proprietorships, the difference may be treated as a draw, increasing your profit (not as many expenses taken). Depending on the type of gift, it could take various classifications on your financial statements. If you are a direct seller, it could be included in cost of goods sold. For others, it could be gifts or entertainment, or advertising. Whatever is most convenient for you, the giver. Onward to some gift giving ideas.
If your dad or associate is a new business owner, a grand opening or congratulations ad in the newspaper would be most appreciated. Most publications offer Announcement sections where this type of ad would be placed. Professional services firms are known for their love of classics, so a painting with some history behind it would be quite welcome. If your dad or associate work in the entertainment industry, an industry traditionally known for having “every asset,” they would enjoy an experience gift – a day on the golf course, for example. Academia and the real estate fields are known for enjoying more personalized gifts. A gift centered around one’s hobby could be appropriate. Consulting firms have been shown to prefer either traditional or activity gifts. For those working in the media industry, know that this industry base their gifts on the relationship. Loyalty is important in the high technology field, so choose those gifts especially wisely. These are just a sampling to get you thinking.
Finally, the most unusual and memorable Father’s Day gift is one involving a sports fan at Detroit’s Tiger Stadium on the closing day of play in that historical venue. Management had “opened up” the stadium to the fans in an appreciative motion. Seats, banners, signs, etc. were all taken. One exuberant person even took a urinal out of the men’s restroom. If that person was a business owner and gave that gift to a business associate who was a huge Tigers’ fan…well, that would be one unusual Father’s Day executive/business gift.
