High Retail Turnover Rate: Its Impact on Your Business

A Retailer's StorefrontNew technology, intense competition, and customers with more complicated tastes are just some of the challenges retailers face these days. But there’s one that’s been consistent for years: high turnover. Companies like the Friedman Group propose retail management training courses to resolve this.

The retail industry remains to have one of the highest turnover rates. The numbers are even higher than they were during the Great Recession. According to Korn Ferry, an executive search firm based in Los Angeles, turnover rates among hourly employees jumped from 57 percent in 2015 to 65 percent in 2016.

Among the 66 retailers surveyed, at least 40 percent of them claimed they had more employees leaving since the start of 2016. To make matters even worse for retailers, most of these people quit during the busiest times of the year, which are Black Friday and the holidays.

Know the Impact

Retail employees leave for a variety of reasons. Some of them may be dissatisfied with their pay and benefits while others may find their jobs repetitive or boring. But one of the foremost reasons doesn’t have to do with the actual job or even the compensation. Rather, it’s due to bad bosses.

In a 2015 Gallup study, 50 percent of the people surveyed revealed they quit their jobs due to their managers. The biggest concern among these workers was the unclear expectations on their performance as managers failed to guide them with their goals and priorities.

While quitting a job is difficult for these employees as it would mean finding another work and dealing with a new company culture, it’s equally challenging for retail organizations.

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For one, re-hiring and re-training costs are not cheap. In a 2000 study by Coca-Cola on their retail operations, the company discovered the yearly turnover costs for each of their stores was almost $200,000.

Hiring new employees during urgent times like peak seasons also increases the risk of dealing with inexperienced, incompetent, and even fraudulent employees.

Set the Right Leadership

If you’re a store manager, it isn’t enough you have the technical knowledge and expertise in retail. You need to complement that with the leadership skills that can help keep your employee engaged and satisfied with their jobs.

You too also need constant education and exposure, and you can begin with retail management courses offered by organizations such as the Friedman Group. You can take some of these courses online, or you can invite educators to your store and share the learning process with the rest of the team.

In the end, employee retention should be one of the main priorities of your store. Begin by eliminating the number one cause of resignation, which is poor leadership.

Post Author: Admin