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Dear David: Is training really a good investment?

November 7/14, 2016: Volume 31, Number 11

By David Romano

Dear David:
Screen Shot 2016-08-29 at 3.15.31 PMI am having such a hard time when it comes to training my staff. I know everyone needs training, but how do I justify the investment? And if I send someone off to training, who is going to help with customers?  

Dear Short-Term Focused Owner,
When thinking how to properly answer your email I was reminded of something I learned when training to teach DISC. During training I learned I am a high D/I personality type and my blind spot is short-term solutions cause long-term problems. What you described is a mirror image of my issue. The idea that it’s impossible to send people to training because it will put strain on you or the rest of your staff only prolongs your potential to have a really motivated and productive staff. Wondering if you can afford to send someone to training because cash flow is too tight only prolongs the potential of producing more cash because your staff is more effective.

The worst decision you can make is to not send someone to training when there is a chance that performance can be improved long term. Also, owners and managers need just as much, if not more, training than sales staff. Missing out on those opportunities because you and/or your management staff are too busy only prolongs the potential of generating more profit, reducing employee turnover and providing the support to improving customer service.

Here is some simple math to help you understand the effects a good training course can have on your company’s sales. Let’s assume:

  • Close rate prior to sending a sales associate to training = 35%
  • Average transaction prior to sending sales associate to training = $2,000
  • Average annual written sales volume = $650,000

During a class your associate spent three days being exposed to how to identify the customer’s needs, build rapport, sell to multiple personality types, sell upgrades and add-ons, and learned the best way to close a customer and effective methods to counter negotiation tactics. Could their close rate go from 35% to 38.5%? Could their average transaction go from $2,000 to $2,200? If you’re thinking yes, that represents a 20% increase in performance.

With those results, one sale associate who attended a training class would go from $650,000 to $780,000. Multiply those results by the number of staff that attended the training and the results are exponentially greater. Let’s take it one step further:

  • $780,000 (increased volume) – $650,000 (original volume) = $130,000
  • $130,000 @ 35% gross profit = $45,500 in profit dollars
  • $130,000 @ 9% commission = $11,700
  • $45,500 – $11,700 = $33,800 gain

There is no training on the market that costs more than $33,800. The only question left is of what training should you take advantage?

The WFCA University has an online training platform that consists of 45 modules for every facet of your business. The WFCA University also has five live camps for sales managers looking to improve their management skills, an inside sales camp for rookies or those who have lost focus, an outside sales camp for owners looking to quickly grow their sales volume, and a camp for owners interested in networking with peers.