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RetailWise Vol. 3 Issue 1

 

Customer Satisfaction is the Ultimate Goal

 

The Store Manager is a Lighthouse

Throughout history the lighthouse has played an important role in navigation and pilotage at sea; its purpose is to guide, to show the way, to warn of danger and generally provide safe entry into harbors.

The Store Manager is the lighthouse for the employees of a retail store and the Head Office is the lighthouse for all of their retail employees nationwide.

Lighthouses do not shift positions; they stand firm and bright and can always be counted upon to guide those looking to them for that purpose. If lighthouses moved; changed direction and sometimes turned out their lights they could not be counted on and, therefore, could not have become such an enduring navigation aid. Granted, technology has diminished the need for the lighthouse as we know it. But other tools and devices now replace the lighthouse. So it is not that the need for guidance no longer exists but only that there are now different ways to provide it.

As long as humans are manning retail stores and as long as retailers want to stay in the game, the Store Manager must be the guidance device…the lighthouse.

The Manager must provide consistent guidance. In every aspect of the store operation there must be clear and consistent management at all times. I am talking about the kind of management that is based on integrity, respect, knowledge and principles; the kind of management that every Manager should practice and so few do.

The Manager with integrity and respect for others will not say one thing and then do another; or make a mountain out of molehill one day and ignore the very same circumstances that precipitated the outburst the next. S/he will not forget that employees- all employees regardless of their position, performance or abilities - should be praised in public and disciplined in private. S/he will establish and abide by some golden rules and insist that others abide by them also. They will ensure there are rewards and consequences and that both are consistently applied.

The Manager with knowledge – both general and retail specific – must use that knowledge for the good of the people and the organization. S/he must constantly engage in productive conversation and activities that transfer that knowledge to others in the store/organization. This Manager must make his/her knowledge free for the asking and everyone must be encouraged to ask.

The Manager with principles will not be thrown off course by whatever comes along.  Decisions will not be made based on comfort or popularity. They will be made based on principles because they understand that giving up their principles leaves them open to the turbulence and uncertainty and, very likely, the failure that befalls unprincipled Managers.

It’s easy to imagine the Manager as the lighthouse in the store environment. Just think of the myriad of details that must be attended to every day…like receiving, merchandising, scheduling, cleaning, hiring, training, banking… just to name a few. And those are only the non revenue generating tasks. The really important work – serving and selling to customers – occupies the majority of the retail employees’ time or, at least, it should.

In an environment like this it is easy for employees to lose sight of the goals and to go off course simply due to the activity in the store and not because they are indifferent, unskilled or lazy. The simple truth is that if there is no one to act as the lighthouse, or if the lighthouse is not stable, consistent and bright, the most important reason for being there in the first place – which is to satisfy customers and produce revenue – may just be forgotten. Most retailers cannot afford to take that chance. The Managers  must provide the guidance.

Interview Tips

Apart from standard stuff, here are a few additional things to consider...

Hiring managers have pain, and if you can convince them that you can help them ease that pain…you’ll get the job.

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Wear your Enthusiasm on your sleeve– if you don’t absolutely exude enthusiasm you are unlikely to land the job. Retailers want happy, bubbly, smiley people representing them in the field. If you appear too serious you will not likely get the job. They might think that you aren’t a fun loving retail person. They will want you to lead or at least participate in pep rallies, games, songs and low cost meetings.

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Make it obvious that you are a people magnet- if you can persuade them that you know many, many outstanding retail employees who would all jump at the opportunity to come and work for or with you…you will likely get the job. Retail turnover rates are astronomical and getting worse so it is really important that any employee hired be useful in recruiting others into the organization.

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Talk about sales and wage cost targets- you have to know that sales and wages are the biggies in retail (particularly at store and district level). You should make it clear, just by using the words in your conversation, that you are an expert on sales and wages and the key performance indicators that pertain to them.

 

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Introducing the DMSRetailer™

The Ultimate and the Only Organizer Exclusively for Store Managers

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Dear Bobbie,

In my company I have learned that a few of the managers are capped. One has been with the company for 6 years and the other for 8. I have been in retail management for over 20 years and have never worked for a company that capped anyone. This company is also beginning to cap Assistants, too. Is this a common practice that I am unaware of or could it be the beginning of the end?!
Robin

Dear Robin,

First of all, let me congratulate for being one of the few lucky retail people who have a compensation package so lucrative that it needs to be capped. Most people, working in the retail industry, do not have an opportunity to make a lot of money.

Companies usually resort to capping compensation when they realize that some of their employees are earning a lot of money while the business unit, usually a store, is not making target. Of course, that results in a higher than desired wage cost. Their first reaction is that the employees need to be stopped. They question why it is happening and what can be done about it. Unfortunately, they come up with the wrong answers. So, they put roadblocks (compensation caps) in place.

Now, not only do they have business units missing targets but they also have employees who are no longer motivated. A ceiling has been put on their earnings. This generally causes the business unit to achieve even less of their target. A vicious circle.

Here are some of the contributing factors which inspire retailers to cap compensation:

1) They cannot continue to increase salaries of long term management personnel because it becomes too much for the business unit to bear. They can still, however, avoid overall compensation caps since a large part of the compensation should be tied to performance anyway. In fact, for long term experienced management personnel earning high commissions/bonuses should be much easier than it is for newer people.

2) They are afraid that some employees will find a way to manipulate the compensation system. For example, if one employee makes the major share of the sales, s/he may get a significant commission/bonus. If the employees have decided to manipulate the system, they will arrange it so that one employee gets credit for everyones sales, makes a lot of money and divides it up with the other employees. In this case, sales do not go up but a large commission of bonus is paid out raising overall wage cost. This is easily dealt with by having a good manager in place.

3) Even without manipulation of the system, one or two employees may make hefty commissions/bonuses while other employees do not. Perhaps the one or two are receiving plum shifts, better leads, more coaching, better training, more management attention in general. Again, this is easily dealt with by having a good manager in place.

4) The compensation plan is seriously flawed and no one knows how to fix it so the quick and easy (but totally wrong) fix is to put caps in place to stop the bleeding.

5) They don't know any better. Perhaps an accountant with no understanding of sales is running the show. Or maybe wage cost is something that is not properly understood in the organization - don't laugh - you would be surprised how many retail organizations have less than competent people at the executive level.

Here is the bottom line: any organization planning high and continuous growth in revenue can not put compensation caps in place. Compensation caps are counter productive. They can only produce negative outcomes in the long run. Instead, they should seek to find the very best, very lucrative compensation plan, show everyone how it works and how they can make lots of money and then, assuming the company is well managed, watch sales happen!

Bobbie

 

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