Introduction
Retailing includes all activities involved in selling goods or services directly to final consumers for personal, nonbusiness use. A retailer or retail store is any business enterprise whose sales volume comes primarily from retailing. Any organization selling to final consumers-whether it is a manufacturer, wholesaler, or retailer is doing retailing. Consumers today can shop for goods and services in a wide variety of retail organizations. There are store retailers, nonstore retailers, retail organizations, specialty stores, Department stores, supermarkets, convenience stores, discount stores, and Hypermarkets existing today. Each type of retailer adopts a different recruitment strategy and different ways of managing its employees. The main aspect of retailing is shelf space management. All the major decisions revolve around managing the shelf space, and based on these requirements, employees are hired. Most of the retailers adopt self-service, self-selection, limited service, and full service. Accordingly, the employees are staffed and managed. In this essay, the critical issues in managing retail employees are discussed.
Job safety
A Retailer must ensure workplace safety to the employees. Most of the retailers have a burglar alarm and direct contact with the local police department in case of any emergency. Employees must feel working at home without any disturbances from the external environment.
An Unsafe job environment like frequent earthquakes, natural disasters, and terrorist attacks, etc., will lead to a scarcity of employees. The kidnapping of employees has become a way of life in many places. The retailer must choose the location of his store in a very safe place and easily accessible by consumers.
Job Orientation
New employees must be oriented to the culture of the organization. On the job training must be provided to convey the values of the retail outlet. Employees must be oriented to the tastes of the existing customers.
A poor job orientation will make the employee unfit in the retail store, and the entire culture and values of the store will be in jeopardy.
Job Security
Employees must have job security. The work terms and conditions must be intimated to the employee at the time of joining, and the managers must maintain a friendly relationship with the employees, and the employees must never feel the fear of getting fired from their jobs at any point in time.
When there is job insecurity, employees will try working to save their jobs, and they become mechanical in their work. Innovation and employee commitment will be a huge lack in this type of environment.
Fair Treatment
Retailers now have a global presence. High-profile companies like McDonald’s have established standard working conditions in all its branches all over the world. The working hours, compensation, etc., must be uniform at all places. A retailer must ensure fair treatment of employees in the store.
Unfair treatment of employees will sometimes lead to employee resentment against the retailer and eventually lead to strikes and shutting down of retail outlets in many cases.
Cultural Impact
The retail companies are going global, and there arises the issue of managing international employees. Retailers like Wal-Mart adopt a polycentric way of managing employees. The main managers in its foreign subsidiaries will be from the home nation, and they will make the major decisions; the rest of the employees will be from the host nation. The other approach is to fill the foreign subsidiaries with the home nation employees from top to bottom, and another alternative is to employ the host nation employees in its foreign stores. Each approach has its own advantages and disadvantages.
It is always better to employ the host nation employees as they understand the culture of their people and their tastes.
Compensation
Retailers must have a fixed and a variable component in their pay. Employees converting the store visitors into prominent consumers must get a hike in the variable component. Target base pay and pay for performance are adopted by most retailers. Global retailers adopt a balance sheet approach to compensate their expatriate employees.
Compensation plays a major role in the satisfaction level of an employee. Retailers can pay high salaries and use this as a great tool to manage the employees.
Incentives
Incentives are a way of motivating the employees. This is highly popular with retail outlets during festival seasons. A lot of free giveaways and gifts are given to retail employees during these seasons, but their work pressure will also be at its peak during this time. The most common incentives include allowances, premiums, and employee benefits. Retailers give traveling allowance, lodging, and dining allowances to their employees. Some retailers send their employees on paid vacation; provide accident or sickness benefits, pensions, and life insurance to boost their work performance.
Employees without incentives will get bored in their job and lose interest, hating their jobs. This will eventually lead to the shifting of the employee to some other company. An incentive plays a major role in avoiding boredom in the job and is an important tool for managing employees.
Performance Appraisal
The performance appraisal system must be transparent and standardized to the core. Employees must be intimated prior about the various criteria involved in promoting an employee or appraising his performance. A retail employee can be adjudged on 360-degree feedback received from the supervisor, owner, customers, and stakeholders. Performance appraisal is a form of recognition to the employee. Task analysis must be used to appraise the performance of a new retail employee, and Performance analysis can be used for the existing employees.
A Nontransparent appraisal system will lead to a lot of bias in managing employees. Ultimately, the system will highly rely on the person, and the decisions will be highly qualitative. This will lead to the deterioration of standards and rise politics within the organization.
Labor laws and Legislations
It is mandatory for all retail stores to follow the labor laws in each nation adapting to changes. Retailers must have a good relationship with the labor unions as they can be a source of recruiting employees and also to prevent strikes avoiding loss. Governmental pressures will be faced by the retailer not following laws and lose the goodwill of the store.
Conclusion
Nowadays, new retail forms and combinations have risen. Some supermarkets include bank branches. Book stores feature coffee shops. Gas stations include food stores. Giant retailers have grown rapidly with high-end information systems and are able to deliver huge volumes of products and services. The main challenges in managing retail employees include Training employees, Workforce demographics, Life long learning, Employee turnover, or Employee Attrition.
Recently, the growing investment of retailers in technology has grown highly. Retailers are using computers to produce better forecasts, lower inventory costs, order electronically goods from suppliers, send emails between stores, and even sell to customers within stores. Retailers are adopting check-out scanning systems, electronic funds transfer, electronic data interchange, in-store television, store traffic radar systems, and improved merchandise-handling systems. This technology growth has made some retailers like Wal-Mart and McDonalds establish a global presence. Retail stores are now selling experiences, not just goods. To maintain the competitive advantage, skilled employees play a major role, and retailers must adopt the above-discussed issues – do’s and don’ts to manage their employees.
References
- Kotler, Philip. Marketing Management, Eastern Economy Edition, Prentice-Hall India Ninth Edition, 2004. pg. 190, pg. 534-542, pg. 637.
- Garry Dessler, Human Resource Management, Eastern Economy edition. pp. 465-479.
- Randy L. Desimone, Jon M. Werner and David M. Harris, Human Resource Development, Pearson education. p. 21
- Stephen P. Robbins, Organizational Behavior, Prentice Hall of India.
- Merril Ewert D and Jennifer A King Rice. 2002 October. Managing Diversity: HRM Review.