Kurt Salmon: Retail needs to review labour management

02 September 2014 Consultancy.uk

Retail investment this year has focused on tech to support customer experience in an omnichannel environment, but businesses should also be exploiting these initiatives to reduce operating costs.

Most retailers are investing in technology to make the store the centerpiece of the shopping experience, but are being challenged to find ways to deliver the desired improved and consistent customer experience across their branches without increasing their staffing costs – still the highest controllable item on their P&L. Yet retailers are missing a trick as a lot of the investment in customer service technology has huge potential to enhance in-store productivity. Take mobile devices as an example.

On the customer engagement side, iPads and tablets can enable staff to check in-store availability and product locations; provide access to technical product information, customer and expert reviews; and clientelling apps can strengthen the relationship with the customer. Mobile ePOS can also be used to issue and supply special in store coupons and discounts at point of sales.

Modern Retail store with a big tv screen

A frequent complaint from store teams is that the customer is now better informed than they are about the products they are selling, the smart retailer is making this information easily accessible to their sales teams. Once armed with the pertinent information about product characteristics, alternatives which might better suit the customer's requirements and complimentary products the sales team can dramatically increase their likelihood of converting the sale and increasing the customer spend.

These same devices, however, can provide benefits on the productivity side: staff can perform stock management tasks in aisle; log-on for work providing managers with visibility of manning in each department – link this to real-time customer traffic information and staff can redirected to busy departments or checkouts so that scheduling also becomes real-time. There are also the opportunities to generate training material and additional notes to help employees complete tasks; real-time sales and KPI data can be viewed anywhere; planagrams and store layouts can be shared across the network to deliver a more consistent store experience.

However, while some 73% of retailers said they would be investing heavily in mobile this year, according to a survey we carried out among 25 key UK retailers, only eight even had in-store Wi-Fi; none had mobile ePOS; and only six out of the 25 had kiosks or staff tablets.

Shopping via a mobile phone

One of the reasons for the slow uptake of mobile – which would appear on the surface to be a no brainer – is probably due to  organisational issues, with no one person having the responsibility for the technology used in-store.

In the 'old days' it was relatively simple to make a decision about what technology to buy as there were obvious best of breed solutions and the major hardware and software vendors were the ones generally educating the retailers. Now there is a massive array of solutions available – particularly, when it comes to mobile – and sales teams for these applications can go via any number of departments – stores, marketing, HR. Retailers are also having to struggle with getting their legacy systems to communicate with new kit, particularly as they move to try and become a true omnichannel business and be able to share a single view of the stock and customer across the company.

That aside, to best convince the business that mobile devices and other in-store technology can have a positive impact on productivity, retailers probably need to take a step back and review labour management – and yes, if necessary conduct some old-fashioned time and motion study.

Kurt Salmon - thin banner

With all the changes that are being made in-store, retailers need to better understand the actual tasks staff are now performing – and those that need to be actioned to deliver what the business requires. They need to know the time it takes to carry out these tasks and at what price. With the introduction of new in-store initiatives, be it with the addition of a click & collect area or RFID that reduces stock counting and checking, or Rapid Scan that reduces customer check out time, retailers need to find out how much free time can be reinvested in other tasks and customer connection.

In this way retailers will be able to better balance staffing and workload, per week, per day and per department and also use the findings to identify improvements and best practice. Defining the new labour standard will also help to make the business case for investment in new technology more of a no brainer. So is it time to start the stopwatch?

An article from Sue Butler, Director at consulting firm Kurt Salmon in the UK. Butler has more than 15 years’ experience working with major European retailers and consumer goods brands. This article was previously posted in Essential Retail.

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