It’s never been easy to be a successful retailer - but right now, it might be one of the toughest jobs on the planet.
Retail has been swept up in a perfect storm of labor shortages, supply chain issues, higher than ever consumers expectations, while trying to bounce back from a global pandemic.
Any one of these on their own would be a tough gig. Throw them all together and you’ve got yourself a big challenge (to say the least).
It’s why the main topics for this year’s NRF were how to get more done with less while creating stand-out experiences for customers and employees.
Surprisingly, the industry grew by 7.2% in 2021 - a 12.3% point jump from the 5.7% dip experienced in 2020. This growth was fuelled by retailers who embraced digitalization and doubled down on customer experience (CX).
Retail is robust and resilient, but like many sectors will have challenges. So let’s take a look at the 3 biggest retail challenges 2022.
1. Hiring and retaining hourly workers
Employee retention is 3x worse in retail than in other industries, costing an average of $1,500 per employee to replace. It’s part of a wider theme we saw in 2021; The Great Resignation.
This phenomenon has been mostly keenly felt in the US with record numbers of employees saying: “I quit.” In September 2021 alone more than 4.4 million Americans quit their jobs.
But why are so many hourly retail employees quitting their jobs? Asking yourself this is what Betsy Summers, Principal Analyst on the Future of Work at Forester, calls The Great Reckoning.
In the latest episode of The WFM Show Workforce Trends and Predictions 2022 by Forrester she said, “People spend so much of their life at work and are looking more critically at their jobs asking - Is it worth it?”
“Those organizations that are seeing huge exits in their ranks, need to go through a Great Reckoning of their own to interrogate how they're treating, and trying to retain their employees.”
In a competitive environment where sign-on bonuses are common and hourly rates are high, retail businesses need to demonstrate what distinguishes their workplace from another.
This goes way beyond the paycheck. Hourly workers care about flexibility and career progression that makes them feel valued and empowered.
From our research, we learned that half of the current retail hourly workers believe finding another job would be easy. Yep, you heard right - 50% of your retail workers feel confident that they could find other opportunities.
So what can you do about it? Flexible scheduling practices and best-in-class employee engagement are great places to start. For example, companies using Quinyx see an average of 98% app adoption rates amongst hourly employees, resulting in better communication and more mainstream scheduling. Average ROI includes a 10% Improved employee satisfaction, 30% increase in employee productivity, and a better in store customer experience.
2. Creating schedules that meet retail needs
Your schedules don’t just need to be flexible; they need to fit the exact need of every location.
Bad scheduling is expensive. The report - The Cost of Poor Scheduling - found inefficient scheduling could be costing businesses up to 40% of income.
Without the right tools, your managers end up wasting hours every week trying to create the accurate schedules. Meanwhile, your employees are often deployed inefficiently, resulting in overstaffing during low customer traffic times or, worse, understaffing during your busiest times.
No one wins. Your employees are either stressed or bored, your customers don’t get the experience they expect, and your business suffers.
With the current labor shortage, understaffing is the biggest challenge, taking its deepest toll on your hourly employees, who often must work harder (and with more rigid schedules) to make up for the lack of labor. That seems to be a common problem, because 51% of employees have experienced understaffing issues, 52% say it resulted in poor customer service.
You get around this when flexible scheduling is combined with powerful, AI-driven labor optimization and demand forecasting. In fact, Quinyx helped one global supermarket chain - with over 10,000 employees and 578 locations - reduce salary cost by 6% by optimizing their schedules, as well as giving them a 70% reduction in time spent on scheduling and staff-related admin.
3. Delivering on customer expectations
The last of the 3 retail challenges 2022 is customers' constantly evolving expectations. Be ahead of this, if you don’t want your business to suffer and start losing customers to the competition.
By embracing digitalization and new technologies, you can get a 360° view of your customers’ cross-channel behavior - while at the same time giving your hourly workers the tools they need to provide a best-in-class service.
For example, when your WFM tool, Point of Sale, training app and CRM are integrated, the level of service you’re able to offer your customers goes through the roof. Not only does it delight your customers, it empowers your store associates and can give them an extra kick of motivation
By empowering your store associates to deliver personalized experiences that go above and beyond customer expectations, you keep them happy and engaged at work. But that’s not all. This approach builds loyalty, generates repeat business and helps your customers get what they want every time.
Retail employees need better tools to easily communicate with managers and colleagues, pick up or swap shifts on their phones, and easily access their salary and holiday information.
Store managers need an intuitive and seamless platform that automatically takes into consideration all preferences, rules, and labor regulations to create the most optimal schedule for every location - putting a stop to inefficient and manual processes.
Head office needs tools that take the guesswork out of long-term planning by providing clear and concise insights to assess future staffing needs before they arise.
A solution like Quinyx helps you instantly see labor plans according to different scenarios, get staffing recommendations to hire or re-train and picture total labor costs by region and location.
Download our report Retail: The State of the Hourly Workforce to find out more about how the right workforce management platform benefits your employees while allowing your business to be more productive and efficient.