Posts Tagged 'retail performance'

Conversion Nightmare

Retail Customer Service Fundamentals — https://dmsretail.com/retail-selling-skills-customer-service-fundamentals-yourtime-study-course/

Test your retail management analytical and problem solving skills.

Here’s the case store situation:

In a busy regional mall, which has been operating for approximately 30 years, and which has undergone several renovations, there is one very unusually positioned store.

The store sells women’s lingerie. It is part of a well known, multi-national chain which does very well.

The store volume is pretty good and they are above average in meeting targets for sales and most other KPI’s.

The one KPI they do not ever meet is conversion.

They are always below chain, region and district average in their percentage of achievement in this particular KPI.

Although they do many things well, they just cannot meet their Conversion targets.

The Store Manager and staff believe they know what the problem is.

The store is situated at one tip of the triangular shaped mall. For ease of access to the rest of the mall, this store has entrance/exit doors on both sides.

On both sides, the doors lead to the hallways of the mall with stores located across the hallways. The store does not have an outside access door…only mall access.

Directly across from one of the doors is a convenience store which sell all kinds of things…from milk and bread to souvenirs, lottery tickets to o-t-c medicine and skincare products.

It’s a very busy store that does not have an access door from the mall parking lot. The closest parking is located just the other side of our case study store.

The only way for people to get to the convenience store without walking all the way around the mall, is to cut through our lingerie store.

And, they do that in huge numbers…to get TO the convenience store and to get FROM there back to the parking lot.

Imagine the chaos. Imagine the traffic counter working overtime!

Needless to say the 28 year old Mom who is running in to pick up some Children’s Tylenol to take care of her sick toddlers high fever, is not going to be enticed to stop and shop for lingerie regardless of the promotions or the sales associate who is standing on her head trying to make it so.

And, the 79 year old gentleman who buys lottery tickets every Wednesday, Friday and Saturday, week in and week out, is not considering purchasing lingerie for his sweetheart.

But, what about the woman who is going to pick up some milk while she is at the mall shopping for shoes?

Or, the guy who is going to get some chocolates from the convenience store three days before Valentine’s Day?

The executive continue to lament the lack of conversion in our lingerie store and refuse to lower the target.

  • Is the Store Manager making excuses?
  • Is the Conversion Rate set too high?
  • What should it be?
  • Has the unusual traffic situation already been taken into account?
  • Is there some wild and crazy way to stop these ‘walk through’ people and get them to buy something?

This situation illustrates the obvious requirement to know the facts before accusing the staff for lack of performance.

More stories like this at dmsretail.com

Back to Basics

A brand new market reality is upon us and, naturally, most retailers want to lift their performance up a notch compared to last year.

How big a jump that’s going to be depends on the overall goals and objectives of the business.

Whatever the number is, reviewing the fundamentals of your retail operation is in order.

Retail Employee Evaluation System — https://dmsretail.com/i-succeed-retail-employee-evaluation-system/

At DMSRetail, when it comes to performance, we place the highest degree of importance on people.

When all things are equal, people make a big difference.

In fact people make a huge difference even when everything else is not equal.

We have seen stores out performing other stores that are located in much larger market areas with higher average income levels within the same retail chain.

Therefore our first recommendation is to take a close look at the people oriented aspects of your operation.

Here are some of them:

Hiring:

Hiring the right caliber of people is crucial to your success in retail management, perhaps more so than in any other industry.

Every single one of your hiring decisions, as a Store Manager, District Manager or Regional Manager or a Business Owner will speak volumes about your organization and your personal values and abilities.

In retail there is no such thing as hiding behind a desk or a cubicle for any employee and, thus, for their Manager.

A simple but very effective way of hiring the right people is modeling.

Develop a sufficiently detailed profile of your most successful person and look for and hire people who fit that profile as closely as possible even if it means paying a few dollars more; you will be rewarded multiple times over in terms of elevated performance and lack of headaches.

Pure and simple.

Training:

Everybody seems to know how important training is, yet most retail managers give it only lip service.

One of the major reasons for the high degree of customer dissatisfaction and resulting lost sales in the retail industry is poorly trained employees who do not have a clear understanding of what is expected of them.

An important part of the training must be clear communication of goals, objectives and expectations in full detail.

Measurements in terms of sales numbers, customer satisfaction index and other performance indicators should be on paper and staff must be verbally quizzed regularly to make sure they know all the expectations and their individual performance against those expectations at any given time.

Performance Evaluation:

If you have installed the performance expectations correctly, then evaluation of staff performance is a simple and straight forward process.

If your staff is performing above expectations, all you have to do is stretch the expectations a little and support them with a pat on the back, prizes and other monetary and non-monetary rewards to keep them going higher and higher.

On the other hand, if they are not performing, there are usually 2 fundamental reasons:

a) Lack of skills
b) Lack of right attitude

Lack of skills is fairly easy to deal with — it means that they have to go back to training.

Dealing with a bad attitude can range from difficult to very complex.

If you followed our advice on hiring, you should not be suffering from bad attitude disease.

In any case, here are possible dimensions of an attitude problem:

a) Management-induced dimensions: incompetent managers almost always create an atmosphere where staff does not care anymore.

If manager to staff communication is poor and/or too seldom, the staff will feel neglected and if the situation continues for any length of time, the feeling will turn into a bad attitude.

Another management- induced dimension occurs when the manager doesn’t know how to motivate or doesn’t want to motivate, or both.

This again, will ultimately result in a bad attitude.

The management-induced bad attitude list can be a long one and will result in severe lack of performance of the store.

b) Lack of self motivation: Some people suffer from chronic lack of self confidence, often as a result of poor upbringing and lack of education.

Unless you are a psychologist ( which you probably aren’t) or have a ton of free time on your hands (which you don’t) this is a tough nut to crack.

Your best bet is probably to part ways.

c) Personal issues: these can be anywhere from physical convenience issues like living far from the workplace and not having dependable transportation to personal family dramas that may be affecting the individual’s focus, devotion and behavior resulting in lack of performance.

Your ‘all around high performers’ are your most valuable asset.

They are your goodwill ambassadors, your spokespersons; they create your image and your fine reputation.

They build relationships with your customers and they can turn them into customers for life.

They sell your products.

Because of the impact they have, you owe it to yourself and your business to hire, train and evaluate people with the utmost care and attention.

The bottom line is you have to be very aware of people performance issues and you have to be equipped to deal with those issues if you want to make this year your best year ever.

You can find our Retail Employee Evaluation System You can Use to Improve Performance in Retail Business Academy:

JOIN Retail Business Academy & Prosper!

Another Day in the Life of a Retail Customer

A recent shopping trip to a store — one of many stores in a large, well recognized chain — indicated clearly, that a performance culture does not exist in that organization.

I have shopped at several of their locations to purchase things for my home and car, for camping supplies, for Christmas lights and decorations, etc.

I can’t say I have ever been really impressed with the service level offered, but I usually found what I was looking for and paid a reasonable price for it.

They sell major brands and can generally be counted on to stand behind the merchandise they sell.

It’s easy to determine, very quickly, whether or not a performance culture exists in a retail company.

If it doesn’t exist, some customers will not recognize it for what it is — they will just be dissatisfied and leave with a bad impression.

On this particular occasion I was looking for a small appliance for the home.

I found coffee makers and mixers and toasters and just about every small appliance you can think of.

What I was looking for, however, was not on the shelves — an electric can opener. That’s a pretty basic small appliance for the home, wouldn’t you agree?

This chain has been in business for many, many years and, in my wildest dreams, I could not imagine that they would not have an electric can opener for sale.

So, assuming that I was just not looking in the right place, I sought out an employee to help me.

To be fair, I must tell you that there was a lot of merchandising going on at the time.

Not that their merchandising schedule should be my concern because customers should never take a back seat to any task being performed in a store.

But it did add to the confusion.

Anyway, the associate I found to help me definitely tried to help me find an electric can opener.

He was somewhat embarrassed because he was certain they had them, he just didn’t know where they were.

He was communicating via headset and tried several times to contact someone who would know where electric can openers were merchandised.

He offered his apologies, for the delay and confusion, while I followed him around and around the small appliances department.

In the end, he said that he was pretty sure they had can openers but no one knew where they were. He was sorry.

This was an excellent example of the lack of a performance culture.

The associate was definitely a performance oriented individual but his colleagues and superiors — the ones he contacted for help — were not.

In a truly performance oriented company, they would all have been on the same page. They would all have worked to find the electric can openers.

The loss of a sale of one electric can opener will not break the company.

But you can be sure that this was not just an isolated incident. When the lost sales add up we all know what the result can be.

Retailers who had been around for years are now gone.

A performance culture must be well defined, well communicated and constantly nurtured.

For great retail performance go to Retail Business Academy

Amazing Little Store vs. Sluggish Giant

Today, we’re going to look at an important, but often ignored, part of running a profitable business…

… using a couple of enlightening (and very brief) anecdotes from my recent shopping adventures.

Let’s call this lesson: Amazing Little Store vs. Sluggish Giant.

See if you can spot how the following short story may apply to YOUR business…

OK, here we go.

In my line of work, I am required to shop a lot! For everything.

Over the past few months I’ve been doing a study on two markets…or grocery stores…in a city of about 500,000 people commonly referred to as Forest City, although that is not its name.

In Forest City, there is an affluent area which is well served by many retailers; chains and independents.

Now, the Sluggish Giant is a huge place — one of a large chain of other Sluggish Giants — but we are focusing on just one in this story.

It was built with selection and one stop shopping in mind.

As with other huge places, they have a pharmacy, an electronics department, a house wares department…you can get bedding, pots and pans, and garbage cans.

In fact, as I am writing I am hard pressed to come up with anything they don’t have when it comes to everyday needs in the course of running a household.

This Sluggish Giant is clean and modern, well signed, well merchandised (for the most part) and is generally well prepared for the public.

Oh… and prices are reasonable.

They even offer cooking classes and have a fitness club attached; a dry cleaners and a little kiosk where you can purchase a bottle of wine.

So, one could say the ‘product’ was great; product being the building, the offering and the whole store environment.

And, as I mentioned above, the prices are reasonable. I might even say they were good, but not cheap….not a bargain or anything like that.

I do have complaints about the Sluggish Giant, though… but not because of the stuff they sell, the prices or the basics they deliver like a clean and tidy environment, etc.

And I’ll get back to the complaints later on.

Now, let’s introduce the Amazing Little Store.

What a place. Lots of good things to say about The Amazing Little Store, but it is quite small and limited in selection due to its size.

There is no pharmacy, no wine store, no dry cleaners, no house wares or electronics department…you get the picture.

In fact, you cannot buy bleach or pet food there. It is definitely not a one stop shop.

Mr. & Mrs. Affluent of Forest City shop regularly at The Amazing Little Store…often. It’s crowded most of the time.

The shopping carts are miniature versions of the Sluggish Giants’ shopping carts. And they have to be, or you’d never be able to maneuver in the place.

Prices are not over the top at The Amazing Little Store, but they’re higher than usual…for everything.

I forgot to mention they have a small flower shop (with higher priced floral bouquets and arrangements) and a ready to go Sushi stand.

The produce is fresher, bigger and shinier!

Here’s a biggie…they have so much staff in the store it’s almost inconceivable compared to any other retailer.

But they do so much business they surely will not have a wage cost problem. There are 16 people working behind the scenes in the salad area.

Those people are working all day long making fresh salads of all types…and they are selling them like they are going out of style.

A final small delight…you can enjoy a free cup of coffee while wheeling your miniature cart around looking at every square inch of shelf and counter space, lest you miss some new and tantalizing foods.
*******************************************************************
No time to travel? Don’t want to incur extra expenses for accommodation, transportation and meals normally associated with top quality training? We’ve got a business changing solution for that.
DMSRetail’s Ultimate Retail Success Collection
*******************************************************************
Now… here’s where the lesson comes in.

While the Sluggish Giant shines as an overall supplier to the household shopper, the staff and customer service policies are disastrous.

It wouldn’t be possible for any customer to think highly of them.

Certainly, many people shop at Sluggish Giant because it’s a huge market that is close to home and has just about everything they need… but that doesn’t mean they would be loyal if they had another option that provided the same things.

So, watch out Sluggish Giant, your future is probably not so bright.

They want you to do everything for yourself. They want you to use self checkout — where there is always a long line up.

If you do want a cashier to check you through, you will wait in an even longer line up. And here is the kicker…even if you are not at self check out…you will self pack!

That is, they do not pack your groceries in the bags (yours or theirs).

No, they just let the groceries pile up on the conveyor belt waiting for you to get the hint that you are supposed to be performing part of their job.

I can’t go on about this or we’ll never get through this lesson.

They are trying to save labor dollars. Well, good for them. Any well run business would pay attention to costs.

But, even though they are not a ‘no frills’ environment with dead cheap prices, they believe that I am supposed to help them out in their quest for wage savings! Really?

Perhaps they need to do a little more thinking about their business. I’m not inclined to help them and I don’t think many other people are either.

Here’s just one small example — one of many similar things that happened to me in that store …one of my items being scanned by the robotic cashier at the Sluggish Giant was ripped open at the bottom (and it was clear that a customer could not have caused this particular damage) — I don’t want packaged food that is not properly packaged, so I asked the cashier to call someone to replace it.

He nodded. A few moments later, because no one came to the desk, I reminded him.

He said “you should just go and get another one yourself”. (Just so you know, I did not go and get it and there was quite the little upset at that young man’s cash desk.)

And all of this from a fellow with a smock that has “Need Help? — Just Ask Me” emblazoned in huge, bold, colorful letters on his back!

And it just ticked me off that the staff members seem to have taken classes in offending customers. The staff members I encountered all need attitude adjustments.

But, alas, there is no management person, working at Sluggish Giant, who will take care of that. They just don’t get it!

If it weren’t so sad and annoying it would be hilarious!

Hey — I realize this isn’t earth shaking stuff.

You may be saying ‘so what’ if I have to pack my own stuff and ‘so what’ if I have to replace a ripped package (because it’s my fault that it’s ripped???).

But that’s the point of this little story.

It’s the little, lousy ’so what’ stuff that actually leaves the biggest impression.

This got me thinking about customer service delivery.

Over at The Amazing Little Store, the staff members are like long-lost family. The cashiers are always smiling and always make you feel like they are glad you are there.

And, guess what? You’re not going to believe this. They have 9 cash desks and, when needed, 9 cashiers. And what might be the reason for all this?

Well, gee, it’s probably to ensure that customers don’t have to wait in line to exit the store.

They love me!!! They’re happy that I shop here. And… they respect my time!!!

The life-time value of a customer is what counts and this little store has got me for life…or as long as I live in this city.

Remember, it’s not that first sale. It’s all the repeat purchases that build a successful business model.

Good business savvy demands over-the-top excellent customer service… all the way down the line.

It costs you a lot of money to acquire a new customer.

Have you ever tried to figure out just how much it costs, to acquire one new customer, in advertising and other promotional costs? Probably you haven’t.

And you probably haven’t tried to figure out how much of your profit comes from your loyal customers.

Well, at least you should understand that your loyal, repeat customers are giving you most of your profit. Think about it.

Without the loyal customer, who would pay for the marketing and advertising to get the new customer??

I probably won’t shop at Sluggish Giant again. They have what I need but I don’t like to shop there — I don’t FEEL good when I shop there.

They don’t like me or respect my time. Even if I do shop there again, I could never be considered one of their loyal customers.

So it’s worth noting that even a great product, at a great price…can be nullified by rotten customer service.

And it’s also worth noting that another place — like the Amazing Little Store — can leave you with great feelings about the experience, making you want to go back again and again even if you have to stop elsewhere to pick up the other things you need.

Convenience is not top of the list, but that’s ok.

So the perfect mix is: Great product, great value for the money…
… and great customer service.

It’s not brain surgery.

Apart from providing great service up front, if your customer has a problem, they better get personal service fast.

You will never make everyone happy, of course. You’ll always have unpredictable problems that just crank some folks so much it damages the relationship forever.

It happens.

And we’ll always see a very tiny percentage of strange customers who cannot ever be satisfied, because they’re nut jobs. Yes, some people are!

I came up through the ranks knowing that customer service can make or break a project; and a business.

Some businesses out there say “whatever”, and accept huge refund rates because they just don’t want to bother with good customer relations.

I don’t recommend that model. It’s a slippery slope all the way to bankruptcy.

Truly resilient success is built on having a killer product… supported by equally killer customer service.

The customer may not always be right… but that’s the right attitude to start out with when dealing with someone.

It’s a huge lesson. Great product, great service. Anything else just doesn’t make sense.

Join the Retail Business Academy & Prosper

Where Have All the Salespeople Gone?

Have you been approached by a real, live human salesperson lately?

For years, we’ve seen a steady decline in the amount of active selling going on in stores.

Even taking Covid 19 and social distancing out of the equation, in recent years human interaction hasn’t been what it was even in the early to mid 2000’s.

Greeting the customer, approaching, determining needs and all the rest of the tried and true ‘steps of selling’ seem to have gone by the wayside long before Covid 19 made it impossible to get anywhere near a customer.

Do you think we have to resign ourselves to that?

Once Covid 19 has been sufficiently squashed, do you think we’ll return to old ways with gusto …return to what used to be considered normal retailing…happy to be able to interact with our customers?

Hard to say, isn’t it?

We hear reports that retail traffic, in 2020, was down by close to 50% compared to 2019. That’s serious.

But, there is an upside.

If you look at it strictly from a numbers perspective, it simply means that retailers need to double the productivity of other KPIs.

Easier said than done, of course. What isn’t?

Too bad simple doesn’t mean easy.

For quite some time, many retailers have only required certain employees to engage with the customer; those in particular positions like cashiers, servers…the obvious ones.

Service models vary widely, as you have undoubtedly seen.

The superstores, the warehouse clubs, the discount stores and ‘brands for less’ type stores are all examples of no service on the floor or, simply, self — service.

They have merchandisers and shelf-stockers, front end supervisors, etc. but no sales associates who seek out customers to attend to them…to sell to them.

For retailers who allow the merchandise, the placement, visual effects, the brand image and all other things not human to do the suggestive selling, well…it’s going to be tough to double up on productivity.

Granted, depending on the merchandise or category, it can work very well.

Some of them do a great job moving multiple units per transaction with their ‘Buy 2 or 3 for $XX’ promos.

Some of those offers are good enough to make a customer feel like an idiot for buying just one.

Is that a good thing? It depends on your point of view.

In any case, special product deals are normal and expected when you are purchasing groceries and snacks, toiletries, etc.

But, they are no replacement for the right kind of human interaction when it comes to other merchandise like apparel, electronics, appliances, gifts and more…when purchasing decisions are more consequential.

Good people make the difference.

For retailers offering ‘human’ service to their customers, the sky is the limit!

Just think about it. Think about what retailers did not so many years ago.

Assisted by sophisticated systems and promotions and signage and advertising…the goods were sold by people.

Now, your problems are not going to be solved with average service provided by average employees.

No…

We’re talking about the kind of service that is provided by well groomed, well informed, well trained sales associates who are genuine, enthusiastic, results driven and really good at what they do and who are supported by strong management.

With that in mind, you need to start thinking about your recovery plan.

If you are going to recover from this disaster that was certainly NOT of your own making, you’re going to need a plan.

That plan must include turning every one of your employees into a revenue generator. It’s just that simple.

Why wouldn’t you do that?

Here are some other pertinent questions you need to ask yourself:

  • What’s the best and fastest way to get huge increases in every Key Performance Indicator?
  • What are profit multipliers and how do they work?
  • How do I implement a Productivity Plan?
  • What resources do I need?
  • Where do I find these resources?

Everything you need is in the:

Ultimate Retail Success Collection

All the training you could want for your team is in the Ultimate Retail Success Collection.

We’ve just added new programs. Check it out here.

And…lest we forget…if you are facing a mandated increase in minimum wage rates, that’s not going to make things any easier.

If you can increase sales to cover the added expense, great. Otherwise…profit will be eroded.

We emphasize ‘minimum wage’ rates because higher wages that are mandated are very different than higher wages that are provided based on merit…based on performance expectations and results.

But, that’s a big discussion for another day.

Performance and Retail Gurus

Just because someone claims they are a Retail Guru or Consultant, doesn’t mean they really are or that they know what they’re talking about.

Take this statement, for example…

If you can’t measure, you can’t manage. True.

That phrase is still very relevant and probably always will be.

Without measuring, how would you ever know what to be busy about, as Mr. Thoreau says?

Or, where to focus your efforts?

There are people running around – calling themselves business gurus, consultants, etc. as mentioned above – who are claiming that the above statement is incorrect.

They say that measuring is causing staff to cut corners; to hurry customers through the line or off the phone just to meet some numerical goal.

They say that it shows that employees are not trusted.

Blah, blah, blah.

That’s ridiculous.

We think they’re just trying to get attention.

As we said, the statement ‘If you can’t measure, you can’t manage’ is still true, regardless of how good or bad you are at running your company and setting your goals and targets; regardless of whether you treat your employees respectfully and show that you trust them or not and regardless if you want to build and maintain a loyal customer base, or not.

Bad management is simply bad management whether you measure or not.

Bad managers are neither helped nor hindered by measuring because bad practices and poor management will always find a way to race to the bottom, no matter what.

But good management is enhanced, and business is improved, by using key performance indicators to help guide decision making and much more.

For the record, yes…you should be measuring anything that you consider to be important in order to manage your business well.

Obviously, expecting staff to rush customers through a line or off the phone is not something that would happen in a well managed company.

Neither should you want them to chat with Mrs. Jones for a half an hour about the surgery her pet has just undergone.

Having high standards and performance expectations is not the same as harassing and beating up your people to make them go faster or being so lax that nothing gets done.

With the proper training and understanding, employees will learn how to conduct themselves without rushing or lagging behind. They will perform as expected.

We must not be influenced by people who use those simplistic examples; people who ignore the bigger picture and hone in on details presented out of context.

It is always better to measure performance.

No question.

But, do it properly…for the true benefit of the business.

Now, if you’re like most business people, you are currently planning something – maybe a brand new week, month, year or 5 Years.

And, you’re planning because you know that success does not come by accident and hope is not a strategy.

We know where you can get the help you need with the serious planning, if you want to be successful.

Our Performance Paks and Webinars are built to deliver.
Check Performance Paks out here.

DMSRetail Press Release – Singapore

DMSRetail brings 4 Top Performing Retail Management Workshops to Singapore – For the First Time! October , 2016 – Sheraton Towers, Singapore

Toronto, ON September 22, 2016 — DMSRetail, a leading Consulting, Training and Services company for progressive retailers, brings leading edge retail management techniques to Singapore for the First time.

Senior Consultant and EVP for DMSRetail, Matt Parmaks says “Over the past two or three years we have seen huge growth in our business coming from the South East Asian Market.

We decided it is the right time to offer our premium Retail Management training programs over there where people could attend without incurring the huge cost of travel that is usually associated with getting the benefits of leading edge retail management training.

From sophisticated retail business success methodologies and analytics to good, old fashioned customer experience strategies as well as performance management techniques that are so crucial for these tough times, DMSRetail brings it all together in a fast paced workshops designed for retail managers and retail business owners alike.

Another Senior Consultant with DMSRetail, John Callaghan says “Doing well in a retail business is not as straight forward as it used to be.

There are so many fascinating ideas and new techniques that retail managers and business owners need to be aware of in order to really excel in retail these days and we want to share all of this with our fast growing customer base in South East Asia.”

With the overall economical conditions the way they are, South Eastern Retailers are buying in to the fact that they must do more about investing in their knowledge, leading edge techniques and their people.

DMSRetail is seeing a sharp increase in interest in their retail management training programs. Details of the programs can be found at

RETAIL SALES/OPERATIONS MANAGEMENT WORKSHOP (October 17-18-19, 2016): http://www.dmsretail.com/retailtraining.htm

RETAIL BRAND & CATEGORY MANAGEMENT WORKSHOP (October 24-25-26, 2016): http://www.dmsretail.com/brandcatman.htm

RETAIL DESIGN & VISUAL MERCHANDISING WORKSHOP: (October 20-21, 2016): http://www.dmsretail.com/retaildesignworkshop.htm

RETAIL STANDARDS, COMPLIANCE & EXECUTION SEMINAR (October 27-28, 2016): http://www.dmsretail.com/retailstandards.htm

Don’t Miss These Game Changing Workshops!

To Your Success!

DMSRetail

www.dmsretail.com

Store Performance Solution

With all the buzz around omni channel retailing, social marketing and new technologies that are either evolving or being implemented, one success factor remains the same and it always will.

That is the human factor that makes the essence of successful retailing.

Retail Success Accelerator addresses the performance of the store staff at associate, supervisor and the store manager levels.

Be assured that without fully competent, fully engaged staff, any other effort to increase customer satisfaction and ultimately increase profits, will be wasted or at best will not deliver its full potential. 

#1 Problem for Retailers is non-performing stores. In a lot of cases, stores do not perform even at their half potential.

This product solves the issue.., Your High Performance Delivered.

Retail Success Accelerator is a Store Performance Solution and you can put it to good use to ensure you get the maximum performance from your store staff.

More information is at its dedicated website: Retail Success Accelerator

One of the critical profit issues in retail is to make sure that the 2 engines of a retail organization, namely Merchandising and Operations, work as a team. Because of the built-in tensions between these 2 engines, many retail companies have a difficult time creating the working relationships that would generate the synergy required to maximize productivity and profits. Following diagram summarizes a fundamental retail organization structure:

RetailOrgChart640px

Obviously, the quality of contribution and support from other functions like Finance, IT and HR is very important as well. All these functions must align around the vision of what needs to be achieved and when.

One of the most effective ways of making people work together, is to tie their compensation to the over-all performance of the organization. This is as important as, if not more important than the culture building and/or other soft approaches to performance leadership.

What we see in many retail organizations is only the top management has their compensation tie in to the performance of the company. This is where many retailers go wrong. Realities of doing it for all levels are obviously much more complex and require some serious effort. But that’s the price of winning at retail just like in anything else.

Pushing for Performance

The fiscal month is coming to a close. The store’s sales performance has been lackluster for several months but, this month, they are doing much better. This coming Saturday is the last day of the month. The Store Manager wants to take the day off to do something with family members. The District Manager says no. The Store Manager is very upset. What went wrong here? Did the District Manager do the right thing by forcing the Store Manager to cancel her plans with her family and, instead, work in her store and make the month?

In the particular case the Store Manager put in a huge effort and the store made the budget for the month. In fact, the budget was made by midday on Saturday and, as previously agreed, she was allowed to take the balance of the day off after budget was achieved. The Store Manager will earn a nice bonus and has finally got one really good month on her books. She should be happy and proud.

In the days leading up to the last day of the month the Store Manager made quite an argument against working that day. She stated that her staff could sell just as well as she could, that if customers didn’t come in to buy then they wouldn’t make budget anyway, if there was bad weather the store would be empty, it was not their fault that they were out of certain types of merchandise, that she couldn’t work every Saturday just to guarantee that the store made budget, etc. In effect, this Store Manager was saying that she did not make a difference to the success of her store. What’s with that?

The District Manager reasoned that, while it was understood that she needed time to do certain things with her family, this was the final day of the fiscal month. As it happened the store was very close to making budget for the month and the Store Manager could certainly use a good month after several bad ones. The DM told her that without her being in the store the company couldn’t really be sure that every single thing was done to ensure budget was achieved. On top of all of the really good reasons for her to be in the store driving the business, the Manager was going to make a nice bonus if they achieved budget.

Still, the Store Manager did not believe her presence was going to make a difference. The District Manager needs to take a good hard look at what went on in this situation. How could it possibly be that the Store Manager didn’t think she would make a difference? Why, then, is she there? And what does that say about the performance of the store in recent months? Has the Manager had this attitude for a while?

These things really make you think. At least, they should make you think.

The District Manager has said that there is absolutely no doubt that if she had not pushed for performance, it wouldn’t have happened. Hopefully, the Store Manager is excited and feeling a little more responsible for her results (good and bad) and that any damage done can be repaired. Also, hopefully, the Store Manager has learned a lot from this exercise and will grow from the experience. If not, well that Manager probably shouldn’t be there anyway.


Enter your email address to follow this blog and receive notifications of new posts by email.

Retail Management Success

Ultimate Retail Success Collection

Retail Business Academy

Retail Business Academy

Archives

Sales & Influence Blogs - BlogCatalog Blog Directory