THE COST OF RETAIL STORE EMPLOYEE TURNOVER
Do you ever wonder how much your next bad hires will cost your retail or department store – thousands, tens of thousands, even more? Well, you’re right!
You’ve heard the old saying, “Nothing happens until something gets sold.” Well, it’s truer today than ever before. Agree? And if something isn’t sold then you’ll be out of business. Let’s stop kidding ourselves and be honest! Customers return to your retail store because of great service. Customers can get all the information and products they want online but when a customer has a negative experience in your retail store, they won’t be back! What does one lost customer cost you? What does multiple lost customers and sales cost you? In short, when shoppers don’t return, it’s because of your employees!
Your business is only as good as the last sale you made. With retail store traffic counts down by more than 15% and dropping fast and retail store employee turnover is more than 65%, your opportunity to make sales and stand out from competitors is much smaller. In an article by Paycor, the average cost of a bad hire can be 2-3 times the person’s pay.
"Right Fit" Employee Elements
Businesses face major problems when hiring and keeping staff. Research analytics company, Workforce Software, shows that high turnover is a costly issue in the retail industry and have pinpointed specific issues that compound the problem, such as:
- Maintaining, training, and growing sales revenues in a high-turnover environment is difficult and costly
- Increasing employee productivity is critical to customer service and higher sales
- Attracting and hiring good people that stay longer is critical
Employee turnover disrupts the quality of service, adds expenses to a business’ bottom line, and can impact overall workplace morale, productivity, profitability and growth. Additionally, in any service position employees should possess Patience, Enthusiasm, Dependability, and Positivity.
When you’re trying to build your retail sales - and who isn’t - there are really only three ways to do it: ● Get more visitors through the door and make a sale to them.
- Get those who have shopped with you to come in more often.
- Get those customers who come through your doors to buy more when they do come in.
Shoppers are most likely to buy from a salesperson when they’re emotionally invested in working with them. Quite simply,customers who are made to feel they matter buy more. 90% of customers are influenced by positive reviews when buying a product (Dimensional Research). Attracting a new customer is 6-7 times more costly than retaining a current one (Kolsky) and a 5% increase in repeat customers can produce 25% more profit (Bain).
When the success of your retail store is in the hands of your staff you must hire the “right fit” employees with the right people skills, attitudes, and behaviors that increase productivity, create purchases, and promote repeat visits.
So, how badly are under-performing staff or just “wrong fit” managers and employees affecting your retail store goals, service, repeat customer visits, sales revenues, and profits? You have to hire staff that have the right behaviors and attitudes to keep in business. As important as skills, knowledge, and experience are, it’s employee behaviors that will make or break your business!
Hiring the “wrong fit” employee costs you money. Lots of money!
Facts of Hiring the "Wrong Fit" Employees on Your Business
- Fact: Friendly employees and good customer service are what causes 73% of consumers to return to a business. 89% of customers switched their business to another competitor following a poor customer service experience.
Source: Harris Interactive/Retaildoc. - Fact: 52% of consumers say they have made an additional purchase from a company after a positive customer service experience.
Source: Dimensional Research - Fact: Over 70% of customers never return to a retailer mainly due to bad customer service. That’s a strong indicator of how important it is to fit employees into titles and positions that they’re suited for. Source: QSR Magazine
- Fact: The average American tells 15 people when they’ve had a poor customer service/sales experience.
Source: American Express - Fact: Studies show that the cost of acquiring new customers is more than 5 times the cost of retaining an existing customer, though some experts say it may be even higher.
Source: Forbes - Fact: The estimated cost of retail store employee turnover averages around $3,365.00 per person for a typical front-line employee.
Source: Retail Training Center/CareerBuilder - Fact: 91% of customers who are unhappy with a brand will just leave without complaining.
Source: thinkJar Customer Strategy Consultants - Fact: 47% of consumers switched to a different business within the last year due to poor service. Employees past behavior determines their future behavior
Source: Microsoft/Retaildoc
All the training in the world can’t fix the “wrong fit” employees. You have to hire the “right fit” from the start so they can handle the built-in stress and demands of the retail environment.
You’re in business to succeed, right? You hire people based on resumes/interviews/experience, but do these things matter if the employee isn’t open to improving, alienates co-workers, lacks drive, or simply doesn’t possess the right attitudes and behaviors for the job? It’s employee attitudes and behaviors that will make or break your business.
Great Behaviors Drive Great Performance!
- Competitive advantage and customer loyalty
- Higher levels of personal productivity – Less customer complaints and bad reviews
- Positive company reputation – Fewer management headaches
- Improved customer engagement & relationship building to promote repeat business
- Higher morale and teamwork – Lower turnover and reduced costs
- Increased sales revenues – Sales with more add-on items
WHY HIRE THE "RIGHT FIT" EMPLOYEE?
The “right fit” helps you stand out, build your brand, create a unique experience that brings customers back, and increases your sales and profits.
If you hired the “right fit” behaviors from the start, how much better customer service and extra revenue would you have generated? What if you have more than one “wrong fit?” Many stores do. What is the cost of just one lost customer? What about all the repeat customer visits you lost? What about the up-sell losses you missed out on? So, what do we need to do to fix the problem?
How Job Fit Now Can Help Your Business
Job Fit Now can help you. Our Work Culture and Behavioral Assessments take just a few minutes to use and are an affordable screening and ongoing evaluation tool that helps you identify the people most likely to be productive and successful employees, and those who will stay on the job longer, and that is what you need! Why? That $3,365.00 in employee turnover costs should be extra profits, and that affects your income and growth!
What does it cost you to hire, train, manage, and fire the “wrong fit” employee? Let’s take a look.
There is no way to fix a “wrong fit” employee!
We’ll help you find the “right fit” employees behaviors and attitudes. After all, you’re in business to succeed, RIGHT?
Let’s chat! Call 888-307-0722 to learn more.
