Mystery shops provide a unique opportunity to go one of two directions with your team. You can either sit on a bunch of scores and make a determination of who is going to get fired or you can use the scores and the aspects of the report to provide further education and apartment leasing training for your people. I don’t know about you but the latter sounds much more appealing to me if I was an apartment leasing professional.
Last week a little cartoon was posted under our Multifamily Mayhem series. It posed the irony of being delivered information that would seem to necessitate action on our part and the foolishness that is perceived when nothing takes place. So let’s follow a little theoretical numerical scenario to talk through why apartment training needs to accompany shops and why shops should not be a standalone tool.
What would you say is the average cost of employee turnover? There is no doubt that the numbers are staggering. As this article on employee turnover states, if you had 10% turnover for a mid-size company, can you imagine that costing you over 7 million dollars? What can be done to reduce those costs? Here we go. I am going to use a video shop scenario for you.
Scenario Shops only
Let’s say that a video shop is scheduled for a recent new hire. They only get 60% for their score. No training is initiated but the new hire is told that if there score does not improve that they face termination. Six months later you schedule another video shop. The score does not improve and the poor leasing professional loses their job. So you have the cost of shops which would be around $350.00 for the two of them. For six months leases were lost as a result of lack of skills. Let’s be real conservative and say one lease a month was lost with a rental rate of $800.00 per month. Translate that into a years’ worth of income for each apartment and there goes $57, 600.00. Again that’s really conservative only losing out on one lease per month. Now the person is fired and you must add in your recruitment and new hire costs back into the overall cost of your employees. Let’s now look at this scenario with training involved.
Scenario Shops with Training
Take all the above data and say you immediately initiate training whether it’s online or live for that new hire to help them change their score from 60% and moving to a goal of 80%. What did that cost you to give that leasing professional the training they needed? If it was online training it could be as little as a few dollars to get them what they need to close the sale or to make the community come alive in the leasing pitch. If it’s live training this may cost a bit more depending on numerous variables. The point is that training costs can be less that 10% of what the cost of the mystery shop is. Now we can realistically say that if the training is applied the leasing professionals closing ratio is going to increase. Let’s say that their training enables them to close 2 more leases based on the rent parameters above. Where does that put this community? An extra $115,200.00 in income has now been realized. The employee does not get fired after six months and now you have also saved your company countless thousands of dollars in employee turnover costs.
We have found that by using a combined approach that the system works. Typically part of the training involves actually reviewing the shop themselves and seeing and/or hearing what they need to work on. Couple that with education that will help them focus on where they need to improve, now you have a satisfied employee who sees the company that they work for as one that values them and is giving them the tools they need to succeed.
If you have any experiences or thoughts on how education and apartment training has been a good comrade in conjunction with mystery shops, please feel free to comment below.