How to Reduce Payroll Costs, Decrease Turnover, and Drive Revenue Across Retail Locations.
Retail technology typically focuses on the customer experience…
It aims to improve customer service, making it faster and more effective. This, in turn, increases the customer spend per transaction. To aid in the process, many companies have started using traffic and POS data to inform their demand forecast, creating employee schedules that perfectly suit customer demand levels.
That said, merely knowing when staff need to be available isn’t enough. In other words, having associates in the right place at the right time doesn’t mean those workers will be motivated to excel, to become the revenue drivers you want them to be.
Collaborating with employees to create schedules that promote work-life balance is the smart way to ensure they’re helping to fulfil their employer’s growth goals and ambitions. It’s also an effective way to reduce staff turnover, which gives retailers a significant competitive advantage.
Employers that have adopted intelligent forecasting and collaborative scheduling practices consider both employee preferences and customer demand when creating schedules:
- Intelligent forecasting helps put the right people, in the right place, at the right time.
- Collaborative scheduling ensures those people clock-in with the right attitude.
Collaborative schedules balance the working preferences of employees with the needs of the business, creating a perfect schedule − literally − for each location. Each location’s unique traffic and POS data is complimented by employee availability and preferences as well as company policies and local labor laws, creating an ideal in-store scenario.
These modern systems can automatically schedule your top performers at the busiest times of the day. They can also match top-sellers with new employees for training reasons.
But can this really lower my payroll bill?
It can by way of workforce optimization:
Optimized schedules use existing data to help organizations forecast their workload. Understanding and anticipating this workload, then, helps managers put the right number of employees in the right place, exactly at the right time.
This level of efficiency, among other benefits, spares employers unnecessary payroll costs.
But can this actually reduce my employee churn?
It can, absolutely:
According to a study by SHRM, 20% of employee turnover occurs within the first 45 days.
According to research done by Capterra, much of this turnover can be attributed to poor scheduling or even scheduling abuse − and it’s costly: The Center for American Progress found that it cost $3,328 to find, hire, and train a replacement associate making $10/hour. That comes to $23,296 spent per year in a store with one manager and ten employees.
These numbers reinforce the fact that reducing staff churn should not be an HR initiative but, rather, an organization-wide imperative because the potential saving are profound. For example, a mobile phone retailer – and WorkForce Software customer – saw staff turnover drop from 125% to 40% using our demand-driven scheduling solution.
But can this truly improve customer service?
Employees who help shape their schedules maintain a degree of control over their lives, which makes them happier, more engaged workers. This boost in morale is often accompanied by better services levels − much better.
It’s proven: Happy, engaged employees sell more merchandise. Therefore, intelligent forecasting and collaborative scheduling benefit everyone across the business, from employees to managers to the head office.
We asked one of our customers, a national shoe retailer, to explain the benefits from multiple perspectives:
Head Office’s view:
“Not only did we find that our conversion rates increased, we found that our sales increased, our costs decreased and, most importantly, our retention rate decreased.”
“The employee reaction, overall, has been a very positive one. They’ve realized that when they are scheduled at the best times, they have the best sales. This gives them the best opportunity to sell the most to the customers. It’s a win-win.”
“As a result, we’re able to sell more. Because if you get the time you prefer, your mentality is much better; you’re a lot more cheerful and, obviously, that helps you sell more.”
How can all this drive revenue?
Boosting average transaction value is the Holy Grail for many retail shops and restaurants.
For instance, one mobile phone retailer adopted intelligent forecasting and collaborative scheduling using their existing traffic and POS data in new ways, boosting in-store conversions from 4% to 11% across their store network.
But remember: Creating a more intelligent forecast of your demand may help you know where employees need to be, and when they need to be there, but combining this improvement with collaborative scheduling means that employees arrive at work more engaged, with the right attitude – and that, ultimately, is the big-ticket item.
Mike Morini is the CEO of WorkForce Software, a cloud provider dedicated to making work easy for the connected workforce around the globe. With real-time insights, pre-packaged domain expertise, and proven flexibility, the company’s workforce management solutions empower employees and managers to digitize time and labor processes, optimize demand-driven scheduling, and simplify absence management.
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