How to Create Training that Boosts the Bottom Line

By Evan Hackel

Most business leaders know that effective training builds more consistent performance among employees, improves customer service, reduces the amount of time that managers spend training new employees, and provides other benefits that impact the bottom line.

But do those same businesspeople also understand just how much a company’s overall profitability will grow when a comprehensive program of training is put into action? In many cases, they don’t. Here’s a case study that gives some food for thought for companies that would like to quickly realize significant improvements in their bottom line.

Case Study: A Restaurant Chain You Know

Tortal designed and implemented a comprehensive eLearning program. One year after the program began, profits had already increased in dramatic ways:

  • At restaurants where 80% of employees had completed the eLearning training, overall business had increased by 4%.
  • At restaurants where 50% or fewer of the employees had completed the training, business had increased too, but by 1.4%.

Now let’s crunch some numbers. Each of those restaurants do about $2 million of business every year. So using that as a baseline, we see that restaurants that had generated 4% more business had made $16,000 more in just one year. In contrast, the restaurants that had achieved 1.4% growth had generated $2,800 in more business.

If you roll out those numbers further, you will see that over a five-year period, the restaurants that trained 80% of their employees would see an increase of $80,000 in new business, compared to $14,000 in companies that had trained 50% their workers. But in reality, the revised training will generate even a bigger ROI, because:

  • Business growth is cumulative. Even if a business grows at a rate of 4% every year, that percentage is built on a bigger profit base. So even if the growth rate holds steady, the number of new dollars earned each year will increase.
  • More efficient operations lead to greater profits and growth. In a restaurant setting, managers who are freed from training responsibilities can invest more of their time running their restaurants. The same principle applies in most businesses. And as we know, better-trained employees are more efficient, sell more, and generate increased profits.
  • Retention rates among well-trained employees have been proven to be higher than for employees who are not well-trained. And as every company executive knows, the cost of hiring and training new employees is very high.

To learn more about providing training that produces results, be sure to check out the course Customer Service Success. 

About Evan Hackel

Evan Hackel, a 35-year franchising veteran is a nationally recognized expert and speaker on franchising. Evan is founder and CEO of Ingage Consulting, and CEO of Tortal Training, a leading training development company. Evan is an active advisor in the C-Suite Network. He is also author of Ingaging Leadership, and host of “Training Unleashed,” a podcast covering training for business. Contact him here, follow him at @ehackel, or call 781-820-7609.