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What is the Real Source of Turnover in Retail?

The Retail Operations Management Workshop

All retailers know that high employee turnover is a major problem in the industry.

Which of the following do you think has the most impact on ET?

a)     Low wages

b)     Physical demands

c)     Lack of family time

d)    Working through holidays when others have time off

If you said none of the above, you are correct.

The biggest impact on ET is bad management. Did you know that 49% of retail associates leave their retail position due to bad management?

True. According to the Chartered Management Institute, 49% of the 3,000 people they polled said they had quit a position in the industry after being dissatisfied with senior staff.

That means about half of retail employees left jobs as a result of being badly managed.

We know that, very often, retailers promote staff to management positions even though they are not properly equipped for a management role. Some of them don’t even have a desire to be managers but accept the position for various reasons such as a higher paycheck, more authority, better shifts, more job security, or maybe even because, if they don’t, they won’t have a job. Many of these people refer to themselves as accidental managers.

Many will readily admit that they have had no management training; they really did not want the responsibility of managing people; and they don’t have any idea how to do it.

CMI director of policy and research Petra Wilton believes putting people in charge of staff who do not have adequate skills can be severely detrimental to retailers’ businesses. She says: “It’s no surprise the retail industry has a lot of staff leaving if it is not investing in training. Managers need skills and in some cases qualifications so they can do their job and keep staff.”

The fallout from this type of promotion strategy is high employee turnover (ET) and, of those who stay many are unhappy workers who make bad impressions on customers.

At DMSRetail, we know it is a fact that bad management practices become very obvious to the customer through the service they receive in addition to the appearance of the store.

DMSRetail’s ‘Retail Operations for Maximum Success’ Workshop provides the knowledge and tools required to increase employee engagement while maximizing sales and profits. This is the training retail managers need.

Excellent management practices and, thus, engaged employees will make the difference on the top line, the bottom line, and everything in between.

Even though some people may be naturally adept at managing people, most are not and they need training. People management skills cannot be learned on-the-job alone. Promoting someone to a management position and then withholding training is setting the scene for a disaster.

Sales and profits will not meet expectations, Employee Turnover will go up, store appearance will suffer, customers will be dissatisfied and the downward spiral will continue. It’s a no win situation.

So, always plan to promote from within when you have a candidate who is well trained and competent at managing your store(s) and your people in particular. But do not promote someone who is not capable just for the sake of getting someone into the position.

Train all managers and have a system in place for continuous improvement.

Choose training programs that will meet the needs of your organization. Training sales associates is very worthwhile, but it should always come after management training. Otherwise, according to the statistics at the beginning of this article, possibly half of your associates – the very people you have invested time and money in - will leave, making your investment in training them a complete waste.

 

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