Small businesses face a unique set of hurdles. One of the biggest problems small businesses face is proper staffing. In fact, according to The Retail Doctor, stores designed to run on six employees are now limping along on two.
While store owners may think this is a good solution to keep costs down, not having enough employees could be causing more damage than they think.
The Retail Doctor offers 4 ways to tell if you’re staffing is too lean:
1. How long are shoppers waiting to pay?
One of the most annoying things for shoppers is having to wait in line to pay for something, closely followed by not being able to find someone who can assist them. At smaller stores, a line of three people can look like an eternity for those who are waiting.
While you may not be able to follow grocery store protocol and open up another check stand if there are more than 3 people in line, you can train your employees how to hustle when it is busy. If that doesn’t alleviate the problem, look at adding additional staff.
Another thing to consider is finding ways to make the wait better for your customers. Starbucks and Krispy Kreme, for example, let customers watch as their orders are being made, distracting them from the fact that they’re waiting.
2. Are your employees adding-on to every sale or are they practically pushing people out the door?
If you’ve trained your employees how to add-on to every sale, you should see that number reflected on your POS report under “average number of items per sale.” If you don’t, make a point of listening to what employees are saying as they lead customers to the cashier.
If they’re only suggesting add-ons once in a blue moon, you can pretty much count on the fact that they’re doing it even less when you’re not around. That’s unfortunate because once a shopper agrees to buy something, it’s much easier to get them to buy again.
But add-ons aren’t going to happen if your employees are constantly running around trying to do the work of three people. If that’s the case in your store, everything’s going to suffer, from customer service and the ability to properly build a sale to the potential to make your store a great place to work.
Provide your employees with exceptional training so they can succeed at add-ons and all other aspects of their jobs. Then continue to invest in retraining. According to a recent ATSD study, companies with comprehensive employee training see a 218% higher revenue per employee. Furthermore, training shows your employees that you value them enough to invest in the bettering of their skills.
3. If your sales are down, compare employee hours over the past three months to the average of the same three months the previous year
While this tip is a bit more advanced, it will help you see if you’ve been running too low on employees for a long time. At that point, you’ll need to determine if lower sales were due to fewer employees or if fewer employees resulted in lower sales.
If you’re tempted to fire employees, remember…sales associates not only do a lot for your store—from setting product displays and providing maintenance, to handling customer service and promoting your business, products, and services—they also cost a lot to replace. According to The Retail Doctor, losing a $10 per hour retail employee costs you about $3,328.
It’s time to start viewing your employees as an asset, not a liability. Without good sales associates, practically everything your business does is worthless.
As a small retailer, you have a golden opportunity to provide exceptional service—something online businesses typically can’t compete with. But if you have too few employees, you’re just a slower and more expensive version of your online competitors.
When you show your employees some love, they’ll return the favor and your business will enjoy more success!
4. Do you often find yourself calling associates to work extra shifts because you’re slammed?
Poor scheduling makes employees feel disrespected and undervalued. Any scheduling practice that treats an employee as nothing more than an expendable laborer—and not a person with a life outside of work—constitutes “scheduling abuse”.
In a tight labor market where employees can pretty much call the shots, there’s no room for errors when you get busy or when someone calls in sick, especially if you’re desperately trying to hang on to your workers.
Plan to have enough employees that you can post a two-week schedule without having to juggle daily changes. That way, you’ll be covered for the rush, not just staffed based on the availability of your employees. Plus, you’ll convey the message to your employees that you care about them as more than labor, which will boost morale.
A coffee franchise once remarked to The Retail Doctor (Bob Phibbs) that they’d been down two people one morning but were fine without them.
“You may have made it through the morning,” he replied, “but speed of service declined precipitously from a 5 person crew to 3. Customers waiting for their drinks noticed and when it comes time to choose coffee again, you’ll be judged against Starbucks speed of service and in that moment, they won’t be back.”
Your store’s employees are your most important asset. While product and marketing are necessary, they’ll both fail without the right team in place to sell to customers. And not just the right team…you need to have enough well-trained bodies on the floor to cover your customers’ needs so you can offer great in-store experiences that will lead to an increase in sales.