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Retail turnover hit 69%. Here’s how to manage it.

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“The shot heard around the world”, the Great Resignation, millions of people around the globe voluntarily leaving their positions, driving turnover through the roof.  In 2021 alone, the employee turnover rate in the retail industry was higher than it had been in the previous 5 years at 69%. For many companies, these levels of attrition can leave them drowning in a backlog of work that could cause them to sink. While employee turnover has always been and will always be unavoidable, the dramatic numbers of today are shining a spotlight on the need for a better way to manage it. 

Focus on getting the most from every labor hour

Focusing on creating systems of efficiency in the on-deck talent is an essential tool when it comes to managing turnover.  Proper scheduling can make or break store performance; however, studies over the past decade revealed retailers have unstable scheduling practices which are frequently the result of lapses in manual scheduling. Most shifts start at the same time everyday with the same number of associates which makes manual scheduling more manageable, but often leaves stores understaffed during peak hours. Still, 57% of retailers manually set weekly employee schedules, which not only leads to oversights and inefficiencies, but also takes a significant amount of time away from managers.  The solution is simple and also helps to push retailers towards digital transformation: Artificial intelligence (AI). AI can drastically improve overall performance by analyzing historical data on each employee’s performance as well as store trends to create the optimal schedule, even during unexpected staffing shortages caused by high turnover. Stores with more stable scheduling saw increased sales by 7%, and labor productivity increased by 5%. Using AI for staff scheduling allows retailers to sensibly re-configure associates to make the most out of every labor hour.

Use store managers as leaders on the sales floor 

When considering the efficiency of stores and their associates, one key resource is often overlooked.  60% of store managers were once associates, and yet, their talent and expertise is generally spent completing administrative tasks instead of on the floor.  This is just another example of the dire need for digital transformation in retail stores. By automating tedious back-office support tasks, store managers can use their knowledge on the floor to assist customers and associates.  This leads to overall improvement of store performance and efficiency while also cutting down on operational costs. Having managers on the floor alongside the associates not only builds strong relationships within the store, but also helps to greatly increase employee engagement. When everyone is engaged, a store that was once a million moving parts now runs as a well oiled machine.

Expect employee turnover and manage it efficiently

Perhaps the most important exercise when managing turnover is preparing for it. There likely won’t be a case where you have zero turnover, so coming up with a plan of action for when you do is key. Many times, the transition from one employee leaving to another taking their place can be choppy as there are many, different components, but little time to break them down. When relying on employees to remember and relay all of their job functions and responsibilities to another, it is unavoidable that some parts may be missed. The solution relies on a systematic approach that ensures information will be quickly and completely passed from one employee to the next. Instead, associate tasks, customer contact info, and everything else that goes into the role needs to be stored digitally and managed systematically so that when an employee leaves the brand doesn’t lose knowledge, data, or most importantly, customers. 

 

Employee turnover might be inevitable, but the challenges associated with it don’t have to be. Harnessing the power of digital transformation welcomes retailers into a new age of efficiency while simultaneously preparing them for future uncertainties. The changes realized now will lay the foundation for success and result in a more engaged staff, better margins, and increased sales. Download the full whitepaper here to learn more about managing employee turnover, the labor shortage, and best practices your business can exercise to help manage it.

 

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