If you are in retail, do you struggle to show an ROI on Upskilling training
Many L&D executives struggle with the challenge of showing how training they are keen to implement will boost the company’s performance and ROI.
In retail, it’s easy. The secret is where you start. Between 45% and 70% of a retailer’s sales are spent buying the products they sell to shoppers. Accountants call it Cost of Goods Sold (COGS). This money is spent by the company buyers. Make buyers number one to upskill. If your upskilling program can reduce the COGS by 1%, or improve the gross margin earned from those goods by 1%, company profit rises by between 20% and 33%! The cost of the program will be nothing like the 20% to 33% above.
The other place to start is in stores. Stores account for perhaps 70% to 95% of company sales depending on how developed your online channel is. But they also account for about 90% of total company expenses (excluding COGS). Upskill your store managers and watch sales grow. Also watch profit contribution rise by optimising the yield of selling space.
In other words, get your ROI by impacting key retail skill areas. You may struggle with things like justifying leadership training and other soft skills. If you lead with the examples above, you will be able to carry a lot of soft skills development on the back of the same ROI. Contact Brian Hume free of charge if you want me to explain this in more detail.
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Posted by Brian Hume
9th May 2025
