Although you may be a small, one-person home-based business, your efficiency and operations can still be affected by a high turn-over rate at vendor, client, and partnership companies you may work with in your business efforts. What does it mean for you and your business when you work with companies that do have a high turn-over with employees.
Most businesses are relationship-dependent. We form relationships with our customers and prospects, but we also form relationships with the companies who provide our equipments, supplies and other things we need to do business. If you are in a consulting industry, relationships are incredibly important as you get most of your work through referrals and maintaining and cultivating relationships. When people leave, this can mean starting from scratch–getting to know someone new, renegotiating contract details, and building trust and a working relationship all over again.
This can mean a loss for your business. It costs money in terms of time and effort to build and maintain these relationships. Networking may be time well spent, but it is still time that costs a business. Working with a company where people are leaving jobs at a high rate–sometimes even multiple people in a position in a year–can take its toll on your own bottom line.
There is nothing wrong with making your partnership choices based, in part, on turn-over rates. Once you’ve been through a situation where a contract has to be renegotiated and re-written or you lose a contract or relationship due to a “changing of the guard” you will know that asking about turn-over prior to putting all your relationship eggs in one basket just makes good business sense. As a business owner, you get to choose who to do business with, and while you may take on a customer, client or contract in good faith only to have personnel change months later (this is increasingly common in today’s mobile job market) create upheaval and insecurity for your business, you can do some research and find out how stable the personnel is in a particular business or industry prior to entering into things.
See Also: Updating Contracts
Should You Be Using Contracts?