Retail In The Face Of An Entirely New Workforce Model
Benchmark Report
Brian Kilcourse and Steve Rowen, Managing Partners, RSR Research
July 2023
Anyone who has shopped lately – particularly in stores – knows that retailers are feeling the pain of a labour shortage and record-low unemployment rates. As a result, this report set out to:
1) identify the challenges all retailers are facing and find lessons that can be learned from the best performers,
2) examine the impact of new customer expectations on what and how work needs to be performed,
3) explore a whole new generation of technology-driven capabilities, and
4) know what internal challenges retailers are facing and which technologies they think will best help them move forward. It’s a lot to tackle. The results are quite compelling.
The Authors of this Report discuss the results of their Research in the video below.
24.05 Minutes
What’s It Like Running A Retail Workforce During Record Unemployment?
Report Executive Summary
A litany of challenges piggyback on having fewer qualified people to solve problems: customer
service has taken a significant hit, and retailers know it. New shopping behaviors require more
complexity, not less, in stores, fulfilment centre’s – all kinds of places where retailers don’t have enough help.
And to only make matters worse, all the new omni-channel shopping behaviors that consumers have adopted in recent years create enormous pressure on brands to not only increase the productivity from the resources they do have, but also decrease labour costs at the same time.
Retailers are in an impossibly difficult position right now.
- As a result, the best performers (Retail Winners) are nearly three times as likely to be folding consumer-grade technologies into their stores to help give associates a fighting chance of being relevant. Shoppers use their smartphones intuitively – almost unconsciously – to solve their lifestyle challenges. Arming store-based associates with those same tools that level the playing field, and don’t require intensive training to understand is the absolute least a retailer can do to stay in the game. Winners know this, and it’s why they are also twice as likely to consider themselves an employer of choice.
- Almost one-half of retailers agree that “more top-level commitment to excellent customer service” is key to moving forward. Over-performers want to be guided by customer satisfaction metrics, whereas average and under-performers just don’t see that as a way forward. What the majority of non-winners want is strong leadership – and almost all of them presume that the result will be “increased investments in customer-facing labour”. That’s an important difference: Winners want to use business intelligence to prioritize next-steps; non-Winners want a strong leader to force the company spend its way out of the box it is in. The Winners’ approach promises the best, most targeted, action plan.
- When it comes to investment plans, a tech-enabled retail workforce is not a question of if, but when. Winners’ investment so far has been pragmatic and starts with getting the schedule correct. Nearly 7 out of 10 of the best performers have invested here and consider this money well spent, compared to less than half of their average and underperforming peers. Winners consistently show an investment plan designed in the fundamentals:
a) keep customers from abandoning ship
b) help find and bring on new talent and
c) optimize the schedules of the folks they are lucky enough to have on staff. That might just help keep workers happy, which in turn would make shoppers happy, and the whole cycle becomes virtuous.
Based on our data, we also offer several in-depth and pragmatic suggestions on how retailers should proceed. These recommendations can be found in the Bootstrap Recommendations portion of the report.
We certainly hope you enjoy it,