The cost of running a retail business goes in only one direction: up. Retailers factor in sales increases every year to cover the ever-rising cost of merchandise, employee wages and benefits, rent, utilities, insurance premiums, and other business expenses.
One way to counter the inexorable increase in a retailer’s cost of doing business is by using retail employee management software to streamline scheduling, benefits management, and other aspects of managing employees. By automating many worker and task management functions, the systems allow retailers to operate more efficiently and focus more of their time and attention on meeting the ever-changing needs of their customers.
Start by Calculating Your Store’s Sales per Employee
One of the maxims of business management is that you can’t manage what you can’t see. For retailers to boost their productivity, they must first understand how efficiently they’re currently operating. The Balance Small Business highlights the importance of establishing metrics to measure productivity and employee performance. This allows retailers to discover the operations that are doing well and those that need to be improved.
Among the methods retailers use to gauge their financial health is by applying retail math formulas and sales-based calculations such as sales per square foot of selling space (excluding storerooms and other areas where products aren’t displayed), sales per linear foot of shelf space, inventory turnover, gross margin return on investment (GMROI), and items per transaction.
Retailers can apply similar metrics to measure the productivity and efficiency of their staff. For example, by calculating sales per employee, retailers can get a more accurate assessment of the level of sales the business must record to pay for new hires:
Net sales ÷ number of employees = sales per employee
For retailers who have both full-time and part-time employees, the hours worked by part-time staff must first be converted to their full-time equivalent.
Key Features of Retail Employee Management Software
The software comparison site GetApp identifies workforce management as one of the three components of a comprehensive human resources software suite:
- Employee tracking, payroll, and benefits management are core HR functions.
- Hiring, training, applicant management, performance review, and retention are strategic HR functions.
- Timekeeping, expense reporting, attendance tracking, and integration with payroll software are workforce management functions.
The most important aspect of retail employee management software is how well the system integrates with and ties together the many diverse processes entailed in operating a retail business. Among the components of a comprehensive HR management program for retailers are the following:
- Time and attendance tracking: This includes the hours worked by each employee, paid time off, sick time, and the amount of time the employee spends on specific tasks.
- Employee scheduling: The system should support scheduling workers at various locations and serving in different roles, such as manager, sales associate, cashier, or stocker. It should also be able to send alerts and notifications to employees automatically when their schedules change.
- Administering benefits: Employees and managers should be able to access up-to-date information about health insurance, paid time off, sick leave, retirement accounts, and other benefit accrual.
- Managing payroll and compensation: Up-to-date information should also be available on past and pending paychecks, bonuses, incentives, and payment methods such as direct deposits and paychecks.
- Tracking job applicants: In addition to collecting and storing applications for employment, the software should track the status of each applicant through the interviewing and hiring process. It should also be able to post and manage help-wanted ads on job and career sites.
- Evaluating employee performance: The systems should help standardize the review process across jobs and roles. They also serve as central repositories for performance-related data collected from sales reports and other sources.
- Employee training and development: Training courses can be integrated with the employee management software so that workers’ progress can be tracked as they learn new skills and earn certifications.
- Onboarding new hires: As new workers are hired, the system sends them emails and other notifications automatically to keep them updated on the process, including information about company policies, practices, and culture.
How Retail Employee Management Software Can Benefit Your Business
Managing retail workers is especially challenging because of the many unschedulable tasks that a store employee is likely to complete during a given workday. G2 points out that retail clerks must make serving customers their priority, which puts their other tasks on the back burner. The lack of a predictable work structure can cause some important duties to remain undone, which reduces the store’s overall performance.
Retail employee management software addresses the need to accommodate the mobility inherent in the role of sales associate while also promoting more consistent customer experiences from associate to associate, shift to shift, and store to store for retailers that operate multiple locations. These are among the key benefits of employee management software for retailers:
- Centralized task management: The many tasks that a retail worker may engage in during a shift can be collected, centralized, organized, and distributed based on the needs of the store at any given moment.
- Transparency: Retailers are constantly implementing changes large and small as they respond to evolving customer preferences and other market and industry trends. Employee management software ensures that the changes are communicated and implemented in all areas and locations to promote consistent customer experiences and facilitate management.
- Consistency across work roles and shifts: By updating tasks and processes in real-time, employees are notified of changes and new policies as soon as they are implemented. Employees benefit by having more structure to their workdays, allowing them to prioritize tasks more effectively and manage their time more efficiently.
Successful retailers understand that the investments they make in their staff pay dividends beyond those that are line items in their monthly financial reports. The greatest benefit of employee management software for retailers may be the impact the systems have on developing workers’ skills and boosting their potential to grow into supervisor and management roles.
Retail employee management software holds the potential to engage workers by providing them with the tools they need to offer customers higher-quality service and to automate many of the more mundane parts of their jobs. The systems allow managers to more accurately assess the performance of individual workers to provide them with positive feedback as well as helping them address areas they need to improve.
Happier workers make for happier customers, and happier customers make for ringing cash registers. For retailers, that’s a win-win-win situation.
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