Retailers across the United States anticipate hiring 594,400 sales associates a year for the rest of the decade. As they struggle to fill positions, especially during the holiday season, retail leaders are doing more to retain experienced employees. Keeping those with experience accomplishes more than plugging holes in staffing; it boosts productivity. 

Strategies for Improving Retail Employee Retention

Faced with a quit rate twice as high as most industries–an average of 3.7% a month between June and October 2022–retail leaders are listening to what employees want. Top-down management styles are being replaced by encouragement and empowerment. The top ways to retain frontline retail associates include:  

  1. More in-depth training on valuable skills;
  2. Recognition and incentives; and 
  3. More interesting work.

Whether it’s adding performance incentives or making training more meaningful, engaging employees leads to more satisfaction, and satisfied employees tend to create satisfied customers and a better bottom line. In fact, a study by Glassdoor found that companies with higher employee ratings had commensurably higher levels of customer satisfaction, and that this effect was twice as large for high customer contact industries, including retail. The study also found that these same companies also had between 7.8 and 18.9 percent higher stock market valuations.

Strategy 1: Retain Retail Employees with In-Depth Training on Valuable Skills

Frontline retail employees everywhere want to move from performing mundane tasks to solving problems. Understanding the need to adapt, retailers are empowering employees to make customer service decisions. When managers demonstrate they trust team members, employees reciprocate with loyalty and quality work. 

Developing an empowered team starts with in-depth training and support from store managers. Most employees will embrace training because it meets their needs for learning and growth, both as an individual and as an employee. A 2021 Gallup survey found training and development increased the job satisfaction of 71% of workers surveyed. Sixty-one percent of workers told pollsters “upskilling opportunities are an important reason to stay at their job.” 

Strategy 2: Recognition and Rewards Strengthen Retention

Many retail employees crave recognition and appreciation. Gallup found employees who do not feel appreciated are twice as likely to say they’ll leave the business in the next year. Just one in three employees surveyed strongly agree they have been recognized or thanked for their work during the last week.

In addition to improving employee retention, regular praise and expressions of gratitude build loyalty and boost productivity. The benefits of recognition extend beyond individuals. Managers who recognize an employee also motivate other team members. As a result, the team’s productivity increases and retention improves.

Many recognition tactics are simple and cost little to nothing:

  • Recognize employees at all-store meetings with stories of how they went above and beyond.
  • Invite a junior staff member to be on a committee or task force.
  • Treat employees to lunch or coffee to listen to their goals.
  • Send an all-staff email recognizing an employee for an accomplishment (if the employee is in a corporate or management position).
  • Give a pair of the company’s tickets to a show or game to a high achiever. 

Team members who have just finished a project or worked a long stretch appreciate extra perks, like permission to take a long lunch or leave early. Some companies reward top performers with gift certificates to restaurants, spas, or salons.

To avoid the appearance of politics or “playing favorites,” managers can make it a practice to recognize teams, not just individuals. Many of the ideas above, like recognition at an all-store meeting or via an email, can work for teams as well as individuals.

Strategy 3: Making Work Enjoyable Improves Retention

Frontline employees want work where they need to solve a variety of problems. When their work is boring, they disengage. Many may look for another job. Thus, successful retailers are continually assessing frontline employees’ repetitive tasks with an eye toward automating what is not as intellectually or socially stimulating—letting humans do what humans do best, which is connecting with customers.

Self-checkouts, automated shelf scanners, and fully managed front-wall services like the Coinstar kiosk lighten the load for employees and boost productivity. Once repetitive tasks are automated, managers find more meaningful roles for employees in the store where they can engage with customers and enhance their experience with caring interactions.

Retention Starts with Recruitment

Remember, retaining good employees starts on Day 1—and even before then. Having good recruitment practices that mirror good retention practices not only makes a company more attractive to candidates, it sets the tone for the entirety of an employee’s tenure.

Candidates today are seeking better work environments, and they will be asking questions of recruiters and employees about these kinds of practices (not to mention poring over online reviews and articles). Learning what retail employees want at all levels—frontline, managerial, and headquarters—can be an invaluable first step in a retention strategy.

Employee Experience Drives Engagement and Retention

Ultimately, what drives employee retention comes down to creating a great employee experience that engages and challenges them. By making a great impression during the recruitment process, training team members well, rewarding and recognizing them, and keeping work fresh and interesting, you can create an environment of high retention and employee loyalty. 

Retaining your high performing employees has been shown to in turn, drive customer experience and satisfaction, which is the key to laying the groundwork for growth and financial success. 

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