Case Study: Hiring and Training for Retail – Don’t Settle for Less Than Doing it Right
It is the new year and many retail field managers are taking over new markets and many owners are thinking of expanding their operations. If that is the case, this article is for you!
Taking over a Problem Market
I remember when I made the jump from running one retail store to running my first district. It was back in the late 80’s and I was working for a national retailer. I was a hotshot that was consistently ranked in the top 50 out of over 5,000 locations and I thought that I knew what I was doing…Unfortunately, like many young store managers who are promoted to district manager I found out how wrong I was.
I had just been promoted to run a 33 store market that was struggling with declining sales, bad inventory management, bad real estate and more. In fact, if you were to name the problem I probably was facing it. One of those issues was that the market was significantly understaffed. The headcount was about 25% below where is should have been. In my mind I knew that I would not be able to attack most of these issues until I hired enough people to staff the stores, so I went on a hiring blitz and got those locations staffed at 100% within 6 weeks.
It is a People Problem, Stupid!
My thinking was that if we staffed the locations so that we could handle customer foot traffic we would then have the time to handle the other issues by getting the store managers managing vs. solely focused on selling. Sounds like a good idea doesn’t it?
Well, it was a good idea. We staffed the stores quickly and began to see a nice double-digit increase in sales. The problem was that they were not profitable sales. Our gross margin began dropping and our customers began complaining. Then sales began to tank. What was the problem?
I had the right idea about hiring more people, but I executed it poorly. I had placed so much pressure on my store managers to hire new team members that they began hiring anyone with a pulse. In addition, we had given ourselves a huge retail sales training problem. In a sentence, my team and I had bitten off more than we could chew.
The Solution…Slow Down to Speed Up
The good news is that I quickly began to realize the issue at hand and implemented a plan to rectify the issues and to solve the staffing problem for good. It started with focusing on the top 20% of our locations where we:
- Loaded them with our best people – result sales in those locations went up by 30% or more and carried the market as a whole.
- Hired people that looked like our top performers – Instead of hiring a lot of new employees we slowed down and hired people that looked and acted like our best people.
- Mentored and trained the new hires correctly – We put the new people in the same stores as our top performers so that they could not only see how to do the job correctly and brought them in for intensive sales training and retail product training so that they had the tools they needed to succeed.
- Fixed the business one store at a time – Once we had a team of great employees we would move them to a new location and fix it by replacing a bad crew with a great team who knew how to run the business correctly
A Legacy of Strong Performing Stores
The result of this disciplined approach was that was that we were able to completely fix the business – sales, expenses, customer experience, inventory management and more – within a year. I am also pleased to say that over 25-years later that market is still one of the best performing in the Company. But I am most proud that many of those team members continue to stay in touch with me. Many have moved on to owning successful businesses of their own, but their legacy of achievement lives on in the people that they have hired and trained by doing it right.
The moral of the story is that if you are going to attack a business problem it is not just about putting in effort, but putting in a smart and disciplined effort.
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- David Goodwin is the Principal of the Retail Advocacy Group. As a 30 year veteran of the retail industry he has directed the activities of hundreds of retail locations and thousands of retail sales representatives and store managers. RAG offers consulting services, retail sales training and management training programs. You can learn more at www.retailertrainingservices.com.