The Value of Quality Employees and The Impact on Your Company

I just walked out of a well-known stationery retailer where I wanted to buy a box of pens priced at R280, but rang up at the till for R400 (due to bad labelling skills by staff). I left the pens at the till, bought nothing at the store and ended up buying the pens from a competitor.

JOBJACK Blog

By Heine Bellingan on Fri Jun 17 2022

Zig Ziglar: “You don’t build a business, you build people, then people build the business.”

Finding the best people in your business is probably the lowest hanging fruit and simplest way to grow your sales, cut your costs and just make everything better!

You might say, “Hey, we spend hundreds of millions on training, learnerships, onboarding and hiring many managers to manage all these well-trained people and all that jazz.”

Good job. No really, good job – proper onboarding, training and support for your team is crucial, but if you don’t onboard, train and support the RIGHT people, then you’re wasting your time.

Quality employees: Like a fresh slice of bread

A quality person is like a fresh slice of bread. Onboarding, training, support – these things are like buttering your bread, adding some cheese, maybe even melting the cheese in your microwave. However, if your bread is full of mould to start off with then you’re wasting butter and cheese.

So get the right slice of bread in the toaster before adding toppings.

Let’s get practical, practical.

(You have to say it like Olivia Newton-John says, “physical”.)

Company X is a clothing retail company that has 20,000 employees and a yearly employee cost of around R3.5 billion.

We will compliment their employees and give them an overall quality rating of 80%.

Now take a minute to think about 'what is quality?'.:

How much NET value does an employee add to the business. Some examples:

  • Value added: A sales assistant greeting a client with a smile, who becomes a return customer. (Directly leads to increased sales).
  • Value added: Stock is out on the floor in time and in the right place. A customer finds what they want and makes a purchase. (Directly leads to increased sales).
  • Value added: A store manager praises a sales assistant for assisting a difficult customer with a smile which contributes to a happy team and a reduced staff turnover. (Directly leads to a decrease in cost).
  • Value lost: An employee steals stock. (Directly cost).
  • Value lost: A sales assistant is on their phone at the back of the store. A customer is not assisted and leaves the store without making a purchase. The customer goes to a competitor and becomes a return customer at the competitor. The customer spends R60,000 over the rest of their lifetime at the competitor. (Direct loss in potential sales).

To further paint the picture of an 80% quality rating: In a group of ten employees, eight would greet customers with a smile and help increase sales while two will sit at the back of the store on their phones and decrease sales.

Now let’s apply that concept at scale:

  • If this retailer generated R30 billion in revenue with 80% quality staff, does this not mean that there is an additional R7.5 billion (20%) in sales that could have been made?
  • If they spent R360mil on training – does this not mean that R60 million (20%) was wasted on moulded bread?
  • With an employee cost of R3.5 billion – does this not mean that R700 million (20%) of the cost went down the drain?

Ask yourself: What is the quality rating of your employees?

JOBJACK is an entry-level recruitment system that replaces your traditional box of paper CVs which enables you to identify quality talent. JOBJACK has been implemented by PEP, Food Lover’s Market, KFC, McDonald’s, Burger King, Kauai and more.