Tips to Choose an LMS for Your Small Business

In our fast-paced world, it’s more important than ever to provide our employees with the resources they need, when they need it. And there are more choices than ever when it comes to buying a learning management system (LMS) for your small business. 

The key to a successful employee learning experience is often selecting an LMS that meets your business’ unique needs. A Learning Management System (LMS) is a software you can use to deliver and manage employee learning content. For most business, an LMS is a critical piece of the learning puzzle. It gives your business the power to monitor employee progress and streamline the entire learning experience.

Finding the Right LMS for Your Small Business

With a number of LMSs to choose from and a variety of features available, it can be overwhelming trying to figure out which one is right for your small business. In this LMS guide, we’ll explore the benefits of an LMS, the features different LMSs provide, and discuss how to compare the costs of different systems.

Whether you already have an LMS or you’re looking to replace your current LMS, you’ll learn everything you need to know about finding an LMS for your small business.

The Benefits of an LMS

For some small businesses, the costs associated with an LMS can seem daunting, but it’s an investment that usually pays off. Here are just some of the ways an LMS can help your business.

Improve Your Onboarding Process

How you train and onboard your employees directly affect their perception of your company and your retention rates. Almost 50% of employees who received poor training wind up leaving their positions within the first year, according to a study by Go2HR. Losing employees means your wallet takes a loss too.

A good LMS can help improve your onboarding and prevent turnover because you can better manage the learning experience. Training is about more than someone showing you how to do something. It’s about giving your employees the right type of resources so they can learn and retain information.

Some small businesses choose to take a blended learning approach where their new employee completes eLearning modules to supplement face-to-face training. Others allow their employees to self-select eLearning courses and customize their own learning path. While the set up will vary based on your unique needs, the idea is that the onboarding experience is very employee-centered. An LMS is an essential part of creating that experience.

Provide a Positive Learning Experience

Another benefit of an LMS is that you can use it to replace in-person courses with eLearning modules. This works particularly well for small business because you save time and money. Your employees will also experience the benefits. In an eLearning environment, they will have the flexibility to open any course in LMS and complete it at their own pace when it’s convenient for them. 

When LMS is used, more employees feel positive about the experience. A 2016 survey showed that 96% of LMS users say an LMS improves both training and tracking. An LMS is an investment into employee productivity and engagement. Despite the upfront costs, you will save time and money. It’s an investment that will pay off in the long-run. 

The LMS Features to Look For


Different LMSs provide different features. Many LMS users end up switching providers because their current one doesn’t have the features they need. Before selecting an LMS provide, narrow down the challenges you need to solve and identify your employee’s unique learning needs.

These are some common LMS features to look for when you are selecting a vendor:

Space for Employee Collaboration

While eLearning modules are an effective way to train your employees, blending learner helps keep everything balanced. Many LMSs offer a social learning feature which allows your employees to share knowledge and connect. Some common features include group discussion boards and file sharing. Discussing course content with other learners and being able to reach out for help improves employee engagement. 

Tracking and Reporting Learner Progress 

A nice feature many LMSs offer is the ability to quickly generate training reports and track learner progress. Whether you want to issue a certificate of completion or just receive notification when courses are complete, a good LMS can automate many of your learning-related processes. 

Customization Options 

To make your LMS work for your small business, you’ll want to be able to customize your LMS so that it reflects your company’s culture. In most LMSs, you can add your business name and logo throughout the system, but not all do. Be sure to check whether this is an option or not, if it’s important to you.

User-Friendly Interface

One of the most critical aspects of an LMS is its user interface. It should be intuitive and easy for both administrators and learners to navigate. Test the LMS interface yourself, and if possible, involve potential users in the evaluation process. A user-friendly system reduces the learning curve and increases adoption rates.

Content Management and Delivery

The ability to upload, organize, and deliver content is a fundamental feature of any LMS. Ensure the LMS supports various content formats, including text, images, videos, and interactive elements. Additionally, check if the platform offers features like content versioning, scheduling, and the ability to create quizzes and assessments.

Scalability and Flexibility

Your small business may be growing, so it’s crucial to choose an LMS that can scale with you. Ensure that the LMS can accommodate a growing number of users and content. Look for options that allow you to add or remove users easily and integrate with other software solutions you might be using.

Reporting and Analytics

Effective training requires tracking progress and assessing the effectiveness of your programs. A good LMS should offer robust reporting and analytics features. These tools will help you measure learner performance, identify areas for improvement, and make data-driven decisions to refine your training programs.

Mobile Compatibility

In today’s mobile-centric world, learners expect the flexibility to access training materials on their devices. Make sure the LMS you choose is mobile-responsive and offers a seamless learning experience on smartphones and tablets. This flexibility is especially important for remote or field-based employees.

Security and Compliance

The protection of sensitive data and compliance with industry regulations are non-negotiable. Ensure the LMS you select meets security standards, including data encryption and user authentication. If your industry has specific compliance requirements, verify that the LMS can accommodate them.

Technical Support

As with any software, problems or glitches are bound to arise. You’ll need to be able to quickly connect with support staff so you don’t delay your employee’s learning progress. Check the customer service hours and support availability the LMS providers you are considering offer. Verify whether or not there is an additional fee for support services.

The Types of Systems to Consider 

Once you know what features you need, you’ll need to decide what type of LMS you want. Two deployment options to consider are:

  1. Cloud-based LMS. and 
  2. Installed software LMS. 

These both operate similarly, but “live” in a different place which will change how your employees interact with it.  

Cloud-Based LMS 

A cloud-based LMS is the most popular type of deployment. These are usually less expensive and easier to scale than an installed software LMS. With this type of deployment, you’re learning content and other data is stored on the LMS vendor’s server. For a small business, a cloud-based LMS will usually provide the most benefits because it is flexible and inexpensive.

Installed Software LMS 

Installed LMS software isn’t as popular anymore, but it’s an option to consider if you have an on-site IT team. As the name suggests, the LMS is software installed on your computers. It doesn’t require an internet connection which is a benefit if you are in a remote area. The downside is the costs associated with it. For many small businesses, it may not be worth the additional cost.

Horizontal and Vertical LMS Systems 

After you decide the deployment you want to use, it’s time to consider whether you want a horizontal or vertical LMS. A horizontal LMS is more versatile system and works well for almost any industry. A vertical LMS, on the other hand, cater to the needs of a specific industry.

Let your business guide you in selecting the right type of LMS. If you’re in a highly specialized industry like insurance or you’re a non-profit, a vertical LMS can help address industry-specific learning changes you face. For most other businesses, a horizontal LMS will meet your needs and give you the flexibility to grow.

Comparing LMS Vendor Costs

Estimating costs for an LMS is a challenging, but essential consideration. Almost 60% of businesses underestimate their expected costs according to a survey by Capterra. Make sure it doesn’t happen to you.

There are two types of costs to consider: 

  1. Initial LMS Costs
  2. On-going LMS Costs

Initial LMS Costs

Initial LMS costs are a large upfront investment you’ll need to make. After reviewing numerous LMS set up fees, the eLearning Industry found that the initial set up for a cloud-based LMS costs between $4,000-$7,000, on average. Self-hosted LMS often ran upward of $25,000

The costs will vary significantly by vendor and the features you’d like to have. These fees often include training, company branding, installation, and some level of customer service support. Some vendors provide all-inclusive pricing, but many others do not. It’s important to check with the vendors you are considering to see exactly what’s included.

On-going LMS Costs

In addition to the initial LMS costs, with most vendors, you can expect to pay ongoing monthly fees. The fees charged vary significantly from vendor to vendor. Some vendors’ monthly fees start at just $2/user while others range upwards of $8/user. The price you can expect to pay for an LMS will also depend on the features your business needs. Make sure to take these fees into account when you’re comparing different vendors as they can really add up.

Final Considerations

Deciding which LMS is right for your business is a big decision. Before you start looking, think about your unique needs. What do you want to accomplish most with an LMS? Are you ready to commit to the on-going expenses associated with an LMS? Do you have the capacity to develop custom eLearning content? Answering these questions will help you plan expenses, find the right LMS vendor, and create a great learning experience for your employees.


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