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To Buy, or to Build: That is the Question

A DETAILED LOOK INTO THE COST OF TRAINING

To Buy, or To Build: That is the Question
August 9, 2016 Anya Anderson

One of the biggest barriers to going with a training provider is that the perceived the cost to bring in a third party is too high. After all, why would you pay someone else to do something you could do for a fraction of the price, right?

…Read on.

Platform ≠ Solution

A person can sign up to use a learning management system LMS for a fraction of the price compared to full service training suppliers and immediately feel like they’re getting a better deal.

All that’s left is to build the training. Can’t be too hard, right?

Well, the Association for Talent Development have done a lot of useful research into the time it actually takes to create training and the numbers are surprising!

To create just one hour of soft-skills training, it can take a person anywhere between 320 and 731 hours. Let’s look at that in a little more detail.

Avg. time to create 1hr of training (hours)1

535.5

Avg. Course Duration (hours)2

20

Total time to create (hours)3

10,710

Avg. hourly rate – Instructional Design

$52.08

Cost to build

$557,810.78

Now let’s compare that to what you get if you were to buy a customizable sales training solution from somewhere that specialises in sales training for retailer’s (ahem…RedSeed).

 

RedSeed Sales Training


$174,570.08
36 Months
500 Users

DIY Training (Using Litmos)


$557,810.78
36 Months
500 Users

Admin UsersUnlimitedFive
Box, Dropbox Content UploadContent Management Provided
Course BuilderCourse Comes Built
Shopify IntegrationNA
E-mail and Phone Support
Reporting & Tracking
Learner Dashboard
Custom Branding
Unlimited Storage
Instructor-Led Training
Developer API
Facilitated Blended Learningx
Tailored Filmingx
Instructional Designx
Dedicated Account Managerx
Implementation Supportx
Industry Benchmarkingx
Email Notificationsx
Course Link Automationx

How did we come to these figures?

To keep things simple, we went for the middle of the road in terms of average time to create one hour of  training internally. So, we based these figures on 535.5 hours to create 1 hour of training.

Next we compared this to our full sales programme which is roughly 20 hours worth of training.

And finally, based the estimated figures off 500 trainees, which is the maximum number leading LMS Litmos document pricing.

Litmos-pricing-table

More Bang for Your Buck?

We’ve unsurfaced some of the hidden costs of creating training in-house. But then we decided to delve a little deeper into what it is that you actually get with a straight-out-of-the-box LMS versus a full service alternative.

Strategy vs. Product Support

When a company signs up to an LMS they’re provided with user support, most of the time in the form of online or via phone. This is great for any technical questions users might have about using the platform. Keep in mind though, that this is where support often begins and ends; with the product.

Having a team who understand how to use a platform is great, but not very useful if they’re not actively engaged in the training.

With RedSeed each client given full user support, but more importantly they also have a dedicated account manager whose role it is to make the training a success. They work alongside client to strategize the best way to drive engagement in the business.

Speed to Market

Our core training programmes are what we call ‘COTS’ which means they’re customisable, off-the-shelf. So, where it would take person over a year to develop a comparable product, with RedSeed they can implement training within a matter of months, or even weeks! Meaning they can get on the road to making more money, faster!

Industry Benchmarking

As part of our commitment to excellence,clients can also opt to take part in the benchmarking initiative, which gives them access to industry insights for training engagement and ROI.

We look at a wide range of retail KPI’s to help out clients gauge their return on investment, and when a business becomes part of this ecosystem, we’ll feedback anonymous data from all of our clients so they can see how they stack-up!

1. Time to Develop One hour of Training: https://www.td.org/Publications/Newsletters/Learning-Circuits/Learning-Circuits-Archives/2009/08/Time-to-Develop-One-Hour-of-Training
2. Time to Complete RedSeed Sales Training: http://www.redseed.com/solutions/retail-sales-training-courses/
3. Hudson Salary Guides 2015: http://nz.hudson.com/salary-hub/salary-guides

Want to know how much more your sales team could be making?

Try out our sales growth predictor now!