What A Children’s Book Can Teach You about Your Clients' Business
Question: How can we help our client companies reduce costly turnover?
Answer: TDA’s Defined Contribution plan can help reverse the cost of turnover, to create more profit for the companies and the brokers.
When I was a child I took what I like to call a rudimentary introductory course on applied logic. That is to say, I read one of my all-time favorite books: If You Give a Mouse a Cookie.
The book’s premise is simple—if you give a mouse a cookie, he’ll want a glass of milk. When he gets the milk, he’ll want a straw. Then he’ll want a napkin. Then he’ll need to use the bathroom. One thing leads to another and another in the story, but I won’t spoil the ending for you.
The logical step-by-step of that seminal classic can teach us all a little something about cause and effect, and how one seemingly simple thing can lead to everything else quickly spiraling out of control. A prime example lies in the world of business and brokerage:
What is turnover costing you?
When an employee leaves, it costs the company an employee. That’s obvious.
But it not only costs that employee, but it also costs the expense of training their replacement. Estimates place the cost of replacement anywhere between 20% of annual salary to 150%, depending on position, production, and time needed to bring the new employee to proficiency.
The cost doesn’t end there. When an employee leaves, you have to add up the cost of losing an experienced worker, the expense of replacement, and the loss of production during the six months to a year it takes for the new employee to reach the proficiency of the old employee.
And during that year? Morale takes a hit. It’s difficult to see colleagues and coworkers come and go. When morale is low, when workers feel insecure about their working situation, customer service and quality suffer, reflecting directly on the company.
So far, that means turnover costs employees, replacement expense, loss of production, poor customer service, and overall lack of work quality. When all these areas suffer, surveys report that workers feel a general air of uneasiness like something is wrong with the company itself—and this can lead to more turnover!
That’s right, turnover can even cost more turnover, leading to frightening statistics like 40% of resignations occurring within six months of starting. And if it always takes so long and so much money to replace those employees, the numbers just keep stacking.
The final cause and effect of this particular story is that when turnover costs your client companies, turnovers cost you, the broker. Employees leaving means clientele leaving. The cause and effect of employee turnover ripples through the company and everyone they work with.
But if you give an employee a cookie...
Rather, if you provide an employee with a benefits package they want, the kind that can help a small business compete with larger businesses, or that can help a larger business reduce their own costs, you help to create an environment where employees want to stay.
When employees want to stay, revenue stabilizes, and cost reduces. Companies become more profitable and hire more workers (not to replace, but to expand). More and happier workers means more consistent and loyal clientele.
When you give an employee that kind of benefits package, you profit.
TDA’s Defined Contribution plan is the cookie that will keep employees satisfied with both their employers, and with the brokers who gave their employers such a great deal.
Learn more about this plan in the brand new report “Your 3 Wishes Have Been Granted... a revolutionary solution to your most painful business & employee benefits challenges.” It’s a free download you can give to your prospects and clients to help them address their turnover problems.
A download you can give to your prospects and clients to help them address their turnover problems.