The retail industry is in a state of flux as consumers increasingly gravitate toward e-commerce. While brick-and-mortar stores continue to drive the majority of sales revenue, many retailers are adopting an omni-channel approach that provides customers with a seamless shopping experience and product availability both in store and online.
This change, driven by technological innovation, is affecting more than just where customers acquire their goods. There is less demand for in-store cashiers, and more demand for data analysis. Data is growing exponentially, include insight into how photos, videos, and social media affect sales. For retailers, this presents significant opportunity but requires a strategic overhaul. Instead of focusing on endcaps and placement of products, today’s employees need to translate raw data into actionable insight, utilize software that can offer a personalized shopping experience, and understand predictive and prescriptive analytics. As technology plays a bigger role in retail, employee roles are increasingly becoming skilled positions, demanding superior proficiency and better pay.
Meanwhile, the industry’s infamous turnover rate—surpassed only by restaurants—is now a real liability, as is its dependence on seasonal, part-time employees. To remain successful, retail suppliers must rethink their human capital strategies, nurturing loyal, long-term employees who understand the changing industry and are invested in adjusting their roles and responsibilities as needed. Retail has always been a relatively nimble industry, drawing from a large pool of often unskilled workers, but these changes have led to fiercer competition for talent, higher wages, and steeper turnover costs.
So how is it HR can support retail? By developing a more sophisticated approach to the employee lifecycle, from recruitment to performance to retainment. HR leaders are in the unique position to help companies focus on hiring the right people and developing them into engaged, devoted employees. Here are four ways HR can support retail as employees become an increasingly valuable—and expensive—commodity.
- Reduce labor costs and increase productivity
In 2017, 16 states increased the federal minimum wage, which is a baseline for many retail positions. As labor becomes increasingly costly for retailers, identifying and rewarding top talent is crucial. Combining people data with sales data can be daunting, but today’s best-in-class HCM solutions are capable of identifying top performers, finding skills gaps, and optimizing scheduling to align teams with customers’ shopping habits. API integrations are game-changing, as are mobile-access functionality and payroll solutions that can process complex earnings and taxation calculations.
2. Turnover and related hiring/training costs
Effective retention programs are crucial as employers move to promoting long-term employment. When managers don’t know someone’s at risk of leaving, they can’t proactively work to retain them. Retailers are also looking to increase employee engagement and productivity, which can be a challenge with part-time employees. Fortunately, today’s managers have access to valuable solutions that can help them predict retention risks and suggest meaningful interventions to encourage them to stay.
- Improve customer experience to increase sales
Many retailers struggle with insufficient resources to properly train sales associates. In today’s landscape, organizations must prioritize onboarding and improving the selling capabilities of their staff. New hires need to quickly understand the product and how to sell it to their target audience, especially during the seasonal rush. Successful onboarding speeds time to hire and expedites integration into store culture, leading to higher productivity and retention.
Advanced learning modules offer bite-sized, consumable videos that bring employees up to speed on everything from customer service skills to compliance, without taking away from time on the sales floor. And since it’s been proven that employee engagement directly affects customer satisfaction, managers can use advanced employee feedback solutions to improve both the employee and customer experience.
- Cost-effectively integrate store and HR systems
Disparate data sources and prohibitive costs are common obstacles to integrating systems. But retailers in particular benefit from the ability to share people data with other store systems without having to rekey information, especially as businesses begin to fully understand the impact these employee metrics can have on organizational success. Business intelligence (BI) data can quickly report on the “state of the business,” integrating with external information for a deeper understanding of sales, customer service, and productivity. Finally, compliance efforts—which have often plagued employers—are simpler than ever, with hands-off support for local and state payroll and tax laws. As a result, HR is free to focus on its strategic reorganization in today’s changing world.
Essentially, HR can support retail by being an active partner during this complete industry overhaul.