Store Operations

 A Final Safety Audit Is Critical As Customer Traffic Peaks

The passing of the American Thanksgiving weekend marks the start of the Christmas Holiday season. Every small retailer by now has their holiday product line on display, their marketing plan in place and staff levels adjusted to the anticipated increase in traffic. What’s left?

There’s little point in opening your doors to all that customer traffic if your store poses safety risks to them as well as your employees. Whether you’ve got insurance or not, a lawsuit in our litigious society will quickly put you out of business.

To prevent such a risk, a documented SAFETY AUDIT should definitely be conducted NOW before the onslaught of holiday traffic. Discovering and correcting safety hazards in your store now, may prevent an accident over the next few weeks. Even if an accident does occur involving a customer or employee, your documented safety audit may help in your defense if legal action is taken against your store. After the holidays, it’s wise to conduct your safety audit on a monthly basis to make sure your store remains safe for everyone and the potential for accidents is minimized.

Our site has a Loss Prevention and Safety Audit form that can guide you in detail on what to look for. Accidents in your store statistically occur in these areas of your operation:

• Trip hazards
• Falls from stools and ladders
• Electrical hazards
• Children who swallow and choke small objects

Here are the key areas you must check as part of your audit:

1) Inspect your entrance way, all flooring and fitting room areas of applicable to make sure carpets and hard flooring are in good repair. Trips by employees and customers often occur where carpets roll up, or where floor coverings change from carpet to tile or hardwood. Make sure moldings and other interfaces are properly fastened and check flooring particularly through doorways where high traffic can damage many types of flooring prematurely.

2) Make sure that employees take a few moments with you to understand the risk of stools and ladders. Falls from ladders and stairways are among the top sources of injury in homes and stores can pose a similar risk. Even a fall from a small ladder or stool can be serious. Head injuries while off balance into shelves and fixtures can be serious. Train staff to never leave ladders or stools on the floor if they are not using them. Customers may attempt to use them, or worse yet, a customer’s child pay try to climb them and fall off in the process.

3) Stores have intensive electrical circuits largely as a consequence of their lighting requirements and draw large amounts of power. Make sure that electrical circuits and lights are in good order. Look for overloaded outlets especially at the cash desk and correct these potential hazards. Lastly, make sure that your power panel has at least three feet of clearance from any combustible materials. Limited space often motivates employees to pile overstock or store equipment in front of the power panel. While you’re at it, make sure that sprinklers have at least 18 inches of clearance below them. High displays and shelving in the back room may compromise their effectiveness in the event of a fire.

4) Manage your store like you would your home when it comes to safety hazards for young children. Parents under pressure to complete their Christmas shopping may lose focus and care for their children only for a moment. Boxes of pins near fitting rooms, small objects and even marking devices pose a choke hazard for little children who may play and swallow these items in your store out of boredom or curiosity. Make sure that any cleaning supplies or other hazardous chemicals are always put away on high shelving in the back room and away from the cash desk or sales floor area. Secure hazardous chemicals like you would in your home.

A safety audit, even when touching upon these basic areas can go far in making your store safe for the holidays for both employees and customers alike.

Here are the key points you should consider when evaluating the safety level of your store.

Take Action Today:

1) Conduct a safety audit now, before the onslaught of customer traffic and if you do not have an audit form, document what you inspected, it’s condition and what action you took to correct the issue. Sign and date your notes.

2) Conduct a safety audit on a monthly basis from here on. Keep the risk of potential accidents as minimal as possible.

3) If your retail operation requires safety eyewear for employees under certain circumstances, make it a 100% no negotiation policy. Employees in the hardware and building business for example must wear eye protection when cutting lumber for customers or even something as simple as cutting metal keys.

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 Store resources continue to be very tight in these challenging times. Labor and store schedules need to be approached with the greatest level of efficiency and effectiveness towards customer service.

 In my travels I have some across these classic errors:

1) Failure to mix senior and junior employees on a shift.
Often, managers will schedule the most junior staff for the least desirable shifts, however these can be often the busiest. High traffic hours may have plenty of staff on the floor, but little knowledge and experience to offer. Shifts need to be balanced, and junior employees need more seasoned ones for guidance.

2) Scheduling too many part time employees with minimal hours.
Lots of part time employees gives managers a lot of flexibility to complete schedules, especially with a handful of employees that are ill. The problem is, part time employees who only work minimal hours will not be up to speed with current store promotions, new products and sales. Their product knowledge may be minimal as well. Loading up shifts with part timers that only work a few hours a week will probably be ill-equipped to offer optimal customer service.

3) Schedules that are not in sync with company productivity standards.
Always take the “acid test” with schedules and determine if your schedule meets company productivity standards. Too many hours, and your schedule may be overloaded. Too few hours may look good on paper in regards to sales per hour potential, but it’s possible that customer service will be compromised as employees are spread too thin on the sales floor.

4) Schedules that repeat week after week.
Customers behave in patterns as a consequence of their family and work commitments. If they always interact with the same employee on the same day on the same shift, their relationship with your store will become limited and vanish instantly if that employee leaves the store. If you vary the schedule, regular customers who behave in patterns will interact with a handful of your employees and get to know all of them. If one employee resigns, their relationship with your store can continue. They still know other employees in the store and business can continue with little disruption.

Take Action Today
Examine your schedules based on these four common errors and make corrections as needed.
Train managers to develop schedules that do not include these errors in the future.
Spot check schedules on an ongoing basis and make sure managers continue to develop balanced ones that rotate staff and meet productivity objectives.

Economic Pressures Increase Opportunity and Curtails Prevention

The Retail Industry Leaders Association (RILA) in the U.S. has just released their latest survey on theft and shoplifting in the general retail market. In several earlier articles, I predicted that shoplifting by amateurs we well as organized professionals and gangs would go up dramatically this year. The losses for retailers associated with theft always increases with the downturn in the economy and this effect has been witnessed many times in the past few decades. This challenging economic period is no different, however it is disturbing how the degree of shoplifting has increased across so many different retail genres this time.

Here are some disturbing statistics from RILA:

-Of all the retailers surveyed, 61% reported an increase in amateur theft and not one retailer reported a decrease in shoplifting occurrences since their 2008 survey.

-Collectively, roughly half of the retailers also reported a sharp increase in retail fraud, burglary and robbery. Violent crimes against retailers is on the rise as well.

-The retail genres most affected are: Apparel, Electronics, Health and Beauty Aids, Groceries and Cosmetics. This follows the pattern typically witnessed in past economic downturns.

-Larger Urban centers such as Los Angeles and New York face more acute increases in theft than smaller suburban markets. It was also witnessed that increases in theft were not only greater but were experienced earlier in the year in larger centers as well.

-Of all retailers surveyed, 72% reported an increase in organized and gang related thefts. These thieves usually steal in larger quantities and impact stores far worse than the opportunistic amateur shoplifter. Many gangs steal and stockpile merchandise to support an ongoing stream of reselling.

Increases in amateur and professional shoplifting have been driven by economic pressures, however opportunities abound when retailers rely solely on Electronic Article Surveillance (EAS) systems to protect their stores. This is what the professional shoplifter prospers from and can easily defeat poorly managed EAS systems. Furthermore, reductions in scheduling compromises floor coverage and creates the random opportunities that amateurs will take advantage of.

Take Action Today:

1) Revisit how your store uses your EAS system (if installed), and retrain staff to focus on customer service and on the floor interaction to curtail both professional and amateur shoplifters.

2) Examine opportunities for theft such as merchandise placement, schedules, employee mix etc. and eliminate situations that can accommodate easy shoplifting.

3) Keep an open line of communication with local police to learn about local trends in retail crime and report instances you have experienced to them so that they can share this information with other retailers in the community.

4) Organize or participate with your mall or community/street retail association or group to devise shrink reducing tactics. All retailers in the group should report occurrences of theft and share information. Descriptions of gangs and organized shoplifters should be broadcast to all retailers in the group so that they will be aware of who are attacking the stores in the area.

Sometimes the Best Things in Life ARE free….

Smaller retailers who operate on a shoestring budget can get things done with the array of great free software out there. Unfortunately, many free packages are full of bugs, or not fully tested and will always remain a “work in progress”. Professional software is usually tested, debugged and periodically updated with ongoing improvements and enhancements. It’s true, you do get what you pay for, however there are some real gems out there, that can really help the smaller retailer in their day to day operations. I haven’t found any of the free Point of Sale systems worth considering, however I plan to review them in more depth for a future article.

Here are a handful of reliable software packages that can get the job done at no cost:

1) Open Office - This phenomenal package stands up admirably to the classic Microsoft Office bundle. In fact, it’s hard to tell sometimes what software you’re using! Open Office includes word processing, presentation, spreadsheet, graphics and database management modules. The smaller retailer can compose letters, analyze their business, do presentations and even signs for the store as needed. In many cases, your existing data files from other similar software productivity suites can be read and edited by Open Office. You can download this great free package and read all about it at openoffice(dot)org.

2) Core FTP - This is a free and stable FTP application (File Transfer Protocol). If you host a website and need to frequently or periodically upload files, this free software works great and can also handle multiple sites with speed connections store in an access list. Core FTP also offers quick reconnect after sessions have timed out and displays a detail progress screen outlining all file transfer progress through uploading or downloading. Unlike many free FTP packages that expire after a short trial period, Core FTP remains permanently active. Check it out and coreftp(dot).com

3) InkScape - If you’re looking for a free alternative to Corel Draw, then InkScape will handle the basics for free. This Vector Graphics package is great for the smaller retailer for creating signs, graphics and most importantly, merchandise planograms. Check out this package at inkscape(dot)org.

4) GOM Player - Are you thinking of adding dynamic graphics to your store? Perhaps running a few monitors with videos adorning your walls or cash desk area? Few multi media players, even the pricey ones compare to GOM players versatility as well as ability to play just about any file format you have. You can also download updates from their site automatically for files that your current version may not support. You can download GOM player at gomlab(dot)com.

5) Flashpeak Slimbrowser - Here is a free browser with all the features of the latest Internet Explorer version. This powerful browser had multiple tabs years before Explorer ever featured them. With too many browser options to list including pop up blockers and more, this browser is free, and all you’ll ever really need. They appreciate donations and update their versions frequently. Get this great browser for your store at flashpeak(dot)com. This browser also features a number of preloaded search engines too!

6) AVG Anti-Virus Software - Grisoft still offers their amazing free anti-virus software for personal use. Their software automatically updates the virus database, scan emails on the fly and perform scheduled computer scans during your store’s off hours if you prefer. This system can perform better than many commercial systems and catch infected files the big guys sometimes even miss! Get this great package at grisoft(dot)com.

I hope that you like these free and amazing packages as much as I have over the years. Use them to their full potential in your store(s) and donate to these dedicated software developers if you are impressed with their products. Donations help keep the wave of great free software flowing to us!

Take Action Today:

1) Visit the free software websites and download these great programs.

2) Donate and support these organizations.

Step Back and Evaluate YOUR Price Position

It’s almost the middle of March and the state of the
Economy and the retail landscape is very close to where
I expected it to be when I made my predictions back in
October of 2008.

The classic customer experience pivots on five critical
elements: Service, Selection, Price/Value, Ambiance and
Convenience.

In our New Economy, Price has taken the lead in being
the most critical element of the shopping experience.
Price has eclipsed Service as the key element in buying
decisions as customers change buying mentalities in
this new era. To support this inference, simply look at
the two retailers who are actually experiencing growth:
Wal-Mart and Costco. Both of these retailers have
experienced growth because of the migration of upper
ended spenders to more value and price driven buying
habits. Great Price and value is the foundation of these
two retail giants and more and more of the buying
community is making buying decisions based on these
elements.

If the proof indicates how critical pure price is to the new
retailer mentality, how does YOUR STORE stack  up to
this new paradigm? Have you adjusted your average price
point to reflect less disposable income and tighter spending
habits? We’re seeing a global drop in high ended retail
spending. Many experts predicted that high ended
retail would not suffer in challenging economic times
because the truly wealthy are never affected by downturns
in the economy. That may be true, however most high ended
retailers survive on purchases by the wealthy as well as the
aspiring wealth seekers who stretch every last penny to
buy that Rolex, the watch of their dreams. It is that strata
of customer that has evaporated from the high ended
retail market and has been forced to make more utilitarian
purchases. After all, a Timex tells the time much like a
Rolex does. We’re already seeing the closure of high ended
retail in Europe and the U.K., and it’ soon to be seen in
the U.S. by the middle of the year.

So, low ended sales are up and high ended sales are down.
I the average price point in your store(s) have not been
adjusted accordingly, you may price yourself out of your
market and lose your hard earned competitive position.

It’s all about Price, Price, Price. Heed the demands of the
customers and their new buying mentality and you’ll
prosper in our New Economy!

TAKE ACTION TODAY

1) Examine average price points and determine if your
price/value position is reflective of tighter spending habits.
Are certain items and certain price points an impossible
value statement in this economy?

2) Consider eliminating very high ended items that only
sold periodically in more buoyant times. Can you mark them
down and sell them off quickly?

3) Review your average price point at store level and consider
marking down more higher ended goods. Can you move
more product and improve cash flow with a lower profit
margin?

4) Consider the introduction of lower priced product lines in
your store. Offer lower priced goods that still offer good value
for your customers.

Waves of Applicants is one Benefit in the New Economy

In prosperous times, unemployment is low and the
challenges retailers face in filling positions with the
right candidate can be next to impossible.

Smaller retailers in boom periods also face another
hiring obstacle. Applicants are attracted to larger
retailers because of their higher profile and the
perceived glamour associated with them.

In our New Economy all this will change to the
benefit of the smaller retailer. Although virtually
all retailers have just laid off their holiday casual
help, it’s inevitable that most will hire more staff
during the year if they are proactive and follow
the right strategies to rebuild business. Natural
attrition and turnover will also create the need to
hire new employees in 2009 as well.

Higher unemployment generates far more applicants
even for the smaller retailer. That means unlike in
booming times where smaller retailers look for
applicants that are “alive and breathing”,  they
have a far greater choice to consider. One positive
outcome of this New Economy is that even
smaller retailers will have a greater choice of
candidates when they need to fill a position
regardless of why you need them.

Considering a wide array of applicants is a big
plus. Beyond this, the smaller retailer can be
more selective and not only just fill a position,
but pick the best person for your organization.

Evaluating the best person through simple
interviewing only offers part of the picture.
Retailers must have a system that scientifically
matches the intrinsic profile of their applicants
to the culture and vision of your organization.
Retailers have the best opportunity in many years
to be highly selective in filling all positions, even
at junior levels. The New Economy will generate
the greatest number of applicants that can be
considered. Add a profiling system to your
hiring process that’s easy to administer and
enables you to confirm that the character,
profile and spirit of service of a candidate
is a match for your specific company.

Effectively review all the applicants and
hire the best fit through a profiling system
as part of the hiring process. Through the
Profiling process, you can ensure that
the candidate that you are considering
has the right personality, leadership style
and spirit of service. These traits on the sales
floor will build customer loyalty, sales and
build business. In these challenging times,
you have the opportunity to build great
retail teams that can take your operation to
new levels while your competition just keeps
doing what they did in “the good old days”.

The New Economy will give you the
opportunity to build potentially
the greatest team you’ve ever had!

If you need an economical Employee Profile
System, you can get one at our retail
website www.retailinstitute.ca, on sale now.

Indeed, there are some positive outcomes
in these challenging times!

Take Action Today:

1) As you receive far more new applicants in the
new economy, select the top 25% of the
candidates based on qualifications and experience
as it appears on resumes and applications.

2) Use an interviewing process that includes classic
interviewing interaction as well as an Employee
Profile system that screens potential applicants.
The Employee Profile System should confirm that
the employee’s character and profile is a good fit
to your particular company’s culture and vision.

3) Make hiring decisions based on not only experience
and qualifications, but on profile matching as well and
build the greatest team in 2009.

Starting on October 27th, we’ll also add the Retail Action Articles Here. This will give everyone an opportunity to comment or add their comments and ideas to the article for everyone to read.

Your opinion, expertise and comments are welcome!