Teach Employees About Your Business to Reduce Expenses and Improve Productivity


Put aside your personal politics for a minute. Does any of the heated dialogue of the past couple months bother you as a business person or the owner of a multichannel company? It bothers me. There is so much misleading dialogue and even fake news.

What if your company made the news? Would employees know the truth? Is your company transparent enough? It makes me feel that we need to do more to continually educate our employees on the drivers to sales and profitability for our business and industry. No, that doesn’t mean we have to share details about P&Ls, though.

Here are three specifics to make my point:

  • State tax abatement to save jobs
  • Outsourcing
  • Imported products

State of Indiana and Carrier Corp.

What perplexes me most is how little people understand about how private business can work with state-county governments to create jobs, make solid investments. It can be a win/win for all parties involved. We have all heard in recent weeks that the State of Indiana and Carrier struck a deal, keeping somewhere between 800 - 1,100 jobs from moving to Mexico. The unfortunate part is that many jobs could not be saved as it was too late in the process.

From what I can tell, I don’t see this deal being different from what I have seen my clients negotiate for investing in headquarters operations, fulfillment centers and call centers in MOST states. Some states like North Carolina and Virginia may be more aggressive than others to gain jobs. But even New York State has become very aggressive with tax abatement for up to 10 years.

I felt a very important factor was left out of this discussion: how the every-day expenditures of those workers will benefit others in the community. Suppose each dollar turns in the Indianapolis economy 3 times? Think of all the other retailers and service providers that gain revenue, profit and can feed their families. Everything from banks to apartment complexes to grocery stores to florists to car dealers and more.


Many companies outsource contact center operations for off-hours coverage. For some companies, outsourcing is their primary method of handling contact center operations. Others use outsourcing for fulfillment rather than internal operations. Financial services companies use offshore outsourcing and save considerable expense.

If you outsource, it’s important for employees to understand the cost savings and benefits. We need to tell the business story better.

Imported Products

There’s been much discussion about Trump’s ties and shirts being manufactured and imported rather than manufactured in the USA. Businesses, including yours, use imported products every day. If it wasn’t for offshore sourcing, America’s business landscape would look very different. Certainly, businesses like WalMart, Target, and others rely on goods made overseas as a part of their business model. Without imported products, consumers would pay much higher prices.

I think that it’s in our best interests as multichannel managers and owners to continually educate managers and employees about the drivers of sales and profit. As we invest in new or remodeled facilities, process improvement, technology, etc., communicate why these business investments make business sense to your company.

Here are two ways to start educating your workforce about issues that impact your business, both centered around communication and transparency:

1. Communicate Company Profitability Metrics Regularly

Start out at a high level if you’re not doing this already.

  • What are the major financial ratios for your business?
  • How is gross demand eroded by returns and cancellations? How do you reduce it?
  • What is gross margin and its components?
  • Why does it take a mark-up of 50% to 60% in many businesses to cover the major costs of marketing, contact centers, fulfillment and G&A costs and outbound shipping costs?
  • Everyone hears about how healthcare costs are rising. The employees see their share. How are you communicating what you spend on this and other benefits?

Share a highly summarized version of your P&L in the longer term. Talk about performance for 2016 and goals 2017. It’s is my belief that we can empower employees once they understand our goals and how things work.

2. Achieving Higher Productivity

I believe most employees are diligent to help you achieve your goals once they understand the goals and productivity you need to be successful. How do your operational metrics stack up to other multichannel companies?

At F. Curtis Barry & Company, we want to help you improve productivity and reduce costs.

If you’re a multichannel company, you might be interested in an exclusive joint project we’re doing with Multichannel Merchant. We’ve teamed up to develop an industry benchmarking report that will focus on key performance metrics and costs across fulfillment center, contact center and inventory management. This research will be developed in cooperation with executives from leading multichannel companies of all sizes.

The results of this exclusive research project will be presented and discussed on March 28, 2017 at the Executive Operations Forum at Operations Summit. Only those companies providing data to the benchmarking survey will receive the detailed, by-company benchmarking report. Nothing needs to be done until after Jan. 1, and survey data collection will remain open until Jan. 30.

Get more information on the forum here

We think it’s in the best interest of owners, managers and your employees to educate them and how our businesses operate and make money. That is the very best course for us to thrive and be relevant in the future. It’s the best way to combat the negative climate today.

 Click to download: Reduce Cost and Increase Productivity