Turnover kills businesses!
Turnover in horse industry businesses is a killer diet. Nothing will kill a business faster, and nothing has more hidden costs. Start by understanding that well trained, loyal, productive employees are the single most important element in a successful horse business. Do not underestimate the value of hiring and keeping good employees.
Having said that, personnel management can be a can of worms at times. Both employers and employees have strengths and weaknesses, hopes and dreams, expectations and disappointments. Whatever we do, sometimes employment relationships don’t work out.
However, turnover can be excessive and damaging to a business. Excessive turnover exists when staff is being replaced at such a rate that continuity of expertise and productivity suffer dramatically.
A farm that replaces a trainer more often than every 24 months, replaces barn help more often then every six months, or replaces a Farm Manager more often than every two years is in trouble. A farm that replaces more than one of these key people in a two year period, needs to take a serious look at it’s approach to hiring, training, and retention.
It is very easy to take turnover for granted miss the costs to the bottom line. There are direct costs and intangible costs here they are:
Direct Costs
(based on an hourly rate of $25 per hour for your time)
Write job description – 2 hours – $50.00
Write/place ad – 1 hour $25.00
Cost of ad – $85.00
Handle initial responses – 6 hours – $150.00
Select/contact applicants – 2 hours – $50.00
Interview – 6 hours – $150.00
Background checking – 4 hours – $100.00
Orientation and paperwork – 2 hours – $50.00
Initial Training – 2 hours – $50.00
Pay for Trainee – 2 hours @$8.00 per hour – $16.00
Coworker’s Assistance – 2 hours @$10.00 per hour – $20.00
Trainee’s first 30 hours @$8.00 per hour – $240.00
Follow-up Training – 2 hours – $50.00
Paperwork, payroll, insurance, etc. – 1 hour – $25.00
Total Direct Cost for Hiring ONE Stable Help level employee – $1061.00
Hidden Intangible Costs
Slowdown in operations – decreased productivity
Manager distracted from supervision of other employees
Manager does not have time to do things to improve the company Poor customer service from untrained help
Lower staff morale – getting to know the new help
Increased employee theft
The conclusion is obvious. Develop techniques for reducing turnover before turnover reduces your business to rubble.
