Suzanne Kapner’s latest piece in the Wall Street Journal, “Retail’s Other Problem: Too Few Clerks in the Store,” highlights top-of-mind issues for us here at Blueday—in particular, the integral (often underappreciated) relationship between store labor and sales.
Kapner notes that “Many of America’s biggest retailers, under assault from Amazon.com Inc., have been slashing staff even faster than they have been closing stores, a dynamic that has left fewer clerks and longer checkout lines at remaining locations.”
The number of cashiers at clothing and accessories stores is down by over 50% compared with 2007 levels, according to her reporting. And over the last decade, the number of people employed in retail sales has risen by only 1.5% compared with 12.5% growth in the population served by those stores.
This has had meaningful ramifications for customers’ in-store experiences—and shopping habits. A study conducted by Adyen, a credit-card processor and payment system, estimates that retailers sacrificed $37.7B in sales over the last 12 months, with 86% of consumers reporting they had left a store without making a purchase due to long register lines.
Kapner explains that “some retailers are discovering they may have gone too far and are beginning to replenish staff. ” Recognizing that they had cut too deep, Dick’s Sporting Goods is increasing store labor by 10% to restore service levels and reduce register wait times.
At Blueday, we fully appreciate the direct relationship between store labor and top-line sales. Store associates drive higher basket sizes, better conversion, and deeper brand affinity. Bringing staffing levels back to healthy and sustainable ratios is certainly a step in the right direction for retailers that have cut “too close to the bone.”
We’d offer another suggestion for retailers looking to recalibrate in this new age of tighter payrolls and higher minimum wages. Boosting the productivity of the associates already on the payroll is critical in today’s fiercely competitive retail environment.
By getting more out of your existing team, with a keen focus on maximizing the sales productivity of every hour on the sales floor, retailers can meet and exceed customer expectations while keeping labor costs in check.
Is your organization balancing reduced staffing budgets with higher service and selling expectations? I’d be interested to hear your perspective.