Half of you hire better than the other half. You can imagine how this variance impacts your bottom line, whether you have 5 or employees. The same could be said for your retention practices.
What if you had half the turnover of your closest competition? I speak with a lot of cleaning service business owners. I do my best to help them understand there is great opportunity in great HR practices. I also let them know somebody must pay for poor HR practices and eventually that somebody is the sales team which may be you.
They may have left because you fired them or they went to a competitor paying an extra 50 cents per hour. The time and money it takes to find a replacement. Sourcing, interviewing, etc. Time and cost of background checks and pre-hire fit for duty exams. You do bothβ¦right? Short-term replacements costs such as paying for overtime, hiring a temporary employee or best of all, doing it yourself.
Training, onboarding, new hire paperwork, payroll, benefits, handbook, etc. The cost affects your margins and pricing structures, making you less competitive.
It affects team productivity. How many people do they typically work with if on a team? It affects safety and work comp costs. The most dangerous employee is a new employee. The ratio jumps dramatically higher with office personnel. Not so fast. After speaking at two CPA conferences, I learned this was not the case. Because there are many fixed overheads involved, the replacement figure is closer to to ratio.
