HR in the Retail Industry
Table of Contents
Table of Contents
What Is the Role of HR in the Retail Industry?
Human resources professionals’ primary focus in the retail industry is helping employees serve the company’s customers better. For the HR professional, this means having the right amount of talent, developing plans to attract talent, and ensuring talent is trained, engaged and retained through policies and processes that put people at the forefront in a customer-centric culture. Ultimately, the employee experience will impact the customer experience.
Why HR Is So Important in the Retail Industry
Retail wouldn’t exist without customers. This concept is ingrained in every aspect and role of retail, and HR is no different. HR can set the tone for the customer experience through maintaining a base of service-oriented, trained and engaged employees. Here are the three C’s that HR shapes for the retail industry:
- Customer experience. When a customer is shopping for either a product or service, the experience they have will most often determine not only if they buy but also if they return to buy again. The people with whom the customer interacts often define their experience.
- Culture. Creating processes and policies that support employees and enable them to perform their jobs with minimal barriers will encourage employees to create an environment where the customer experience is optimized.
- Capability. Getting a team of people quickly up to speed and able to serve customers’ needs includes training in both soft skills (communication, customer service, conflict resolution, coaching) and technical skills (point of sale systems, inventory systems, financial metrics, merchandising).
Responsibilities of HR in Retail
Just as in any industry, human resources plays an important role in hiring, onboarding, and training new employees, but their duties stretch beyond that. Let’s take a look at some of the responsibilities of HR in retail.
Hiring and Onboarding
HR is responsible for hiring and onboarding new employees. These are important times in an employee lifecycle; the candidate and onboarding experiences often have a lasting impact on an employee’s engagement and productivity.
Since it’s difficult to hire in the retail industry, you may have to approach things differently than you normally would. When evaluating candidates, pay attention to their attitude and willingness to learn. Often, the best employees are the ones who come in with little experience and learn as they go. Building up your employer brand is also a great way to find better talent—when people are excited about the brand, they’re more excited about becoming a part of the team.
- Tracking turnover to determine hiring needs
- Posting jobs to job boards and the company career page
- Screening candidates
- Conducting interviews
- Sending out offer and rejection letters
- Creating a structured onboarding process
- Training new hires
In the retail industry, there are many different types of training that have to happen. Corporate leaders, employees working in-store, and warehouse workers all need to receive appropriate, job-specific training. Because of the high level of turnover in retail, it can be tempting to focus entirely on hiring new employees and neglect training current ones—but don’t! Offering proper training will help employees fulfill their job responsibilities more effectively, benefiting the business in the long run.
- Knowing the company’s training needs
- Keeping track of what training each employee has received
- Conducting workplace safety training
Compensation and Benefits
An important part of HR in the retail industry is determining how much workers are paid and what benefits they’ll receive. In addition to core benefits like health, dental, and vision insurance, many retailers offer extra benefits, such as discounts or a flexible schedule.
- Benchmarking to determine what pay is fair for each role
- Helping put together a compensation strategy and benefits package
- Managing changes to benefits during open enrollment
- Running payroll
- Making sure employees are paid accurately and on time
- Making sure the business complies with the Fair Labor Standards Act (FLSA)
Policies and Compliance
HR takes charge of creating and upholding policies, as well as maintaining company compliance with state and federal laws. Workplace policies are one tool HR can use to create a positive work environment, which in turn leads to greater employee engagement and retention.
- Writing company policies, including policies on harassment, bullying, and discrimination
- Adding policies to the employee handbook and updating it as necessary
- Making sure employees agree to follow the guidelines laid out in the handbook
- Ensuring that policies are followed by employees
- Being aware of laws such as FLSA, FMLA, OSHA, and more
In the retail industry, HR acts as the link between employer and employee. Their job is to ensure that the company flourishes, but also that employees have a good experience. Some major obstacles to good employee relations are career stagnation, underperformance, and workplace investigations. By handling these situations tactfully and respectfully, HR can remedy many issues that would otherwise escalate.
- Resolving workplace conflicts
- Training managers on best practices for performance management
- Ensuring that employees frequently receive feedback in one-on-one meetings and/or performance reviews
- Using recognition and rewards to drive employee engagement
The number of customers in stores varies throughout the year, which can make it difficult to know how many employees are needed at any given time. HR is responsible for building schedules that take employee’s needs into account while also making sure there are enough workers to keep things up and running. To do this, you’ll want to track data over time, analyze it to determine patterns, and create schedules around those patterns.
- Determining how many seasonal employees to hire during the holiday season
- Creating a system that allows people to swap shifts if they can’t work during their scheduled time
- Allowing for flexible schedules to help with work-life balance
Challenges of HR in the Retail Industry
Retail is fast-paced, customer-facing and ever-changing. The nature of retail itself drives significant challenges for HR professionals. The paragraphs below detail just a few of the challenges specific to HR leaders in the retail industry.
Managing a Seasonal Workforce
Many retailers experience “seasonality” in their sales. For example, there is typically a peak for the three months preceding Christmas followed by a sharp decline in sales. As a result, many employers elect to hire “temporary” or “seasonal” workers.
Engaging and getting the best out of employees that know they will be gone in three months can be very different from working with employees who intend to stay year-round. Many employees can be hired part-time and work shifts that don’t coincide with yours. Create ways to connect with employees you may not see regularly through technology (or maybe a written note) to ensure they are doing well and are appreciated.
Retention and High Turnover
Turnover is the number of terminations divided by your average number of employees during a specific period of time. Retail stores can experience well over 100% turnover rates on an annual basis when part-timers and seasonal employees are a significant portion of the employee base. Turnover is costly because it means needing to recruit, hire, onboard and train the next round of employees all over again.
Managing an Often Inexperienced Workforce
Retail work doesn’t often require much experience. Frequently, in fact, there is no experience requirement. Retail is often an employee’s first job. This adds a certain complexity to the role of the HR professional in terms of onboarding. You will be responsible for teaching the employees expected behaviors at work (how to show up on time, how to dress, how to greet a customer or answer a phone) that extend beyond the tasks associated directly with the actual job they were hired to do.
“Shrinkage” is the term retailers use for theft. Theft can happen either internally or externally. According to Shopify.com, shoplifting is the single largest cause of theft. Types of theft include return fraud, employee theft and administrative errors.
Safety is everyone’s role. HR’s role is to ensure that it’s addressed as a part of onboarding and that the policies and practices to maintain a safe working environment are upheld at all times. Many retail employees have lifting requirements and simply move around more than employees in other lines of work, so the chances for injury in retail tend to be higher than in office or administrative capacities. Failing to manage safety in the workplace can lead to costly workers’ compensation suits and, worse yet, serious personal injury.
Tips for HR Leader in Retail
When prioritizing tasks, focus on how you can impact the three C’s: customer experience, culture and capability. Attracting and hiring the right talent will have the greatest impact on the three C’s, so begin by making it as simple as possible for candidates to apply. What is your application process like? Is it quick and easy? Then, once you get new employees through the doors, pay attention to the following elements of their employee experience.
Make Onboarding Matter
Make employees’ first day special. Make sure they have everything they need to start confidently. If you provide name tags, make sure they are ready. If you have any merchandise or giveaways with the company logo, make a welcome goody bag. Everyone loves free swag. If benefits selection is a part of onboarding, ensure someone is present to answer all of their questions. Provide lunch and a lunch buddy if you can.
Remember, the new employee will likely know no one on their first day, and that can be awkward. Be sure to make proper introductions to the larger team. Make sure seasonal workers have a reason to want to make their stay a permanent one. Make sure you maintain an open door policy and are easily accessible.
Stay Current With Technology
Learn from your vendors the easiest method to train on the systems you use. Provide your employees with helpful “cheat sheets” on how to perform common or frequent transactions and include who to call for a list of commonly occurring issues. This may include return or exchange processes or shipping merchandise. It may also include how to sell or redeem gift cards or remove merchandise from inventory.
Have a Robust Training Strategy
Create a short training plan for what the employee should become proficient in during their first week, two weeks, month and beyond. This can be done in the form of a checklist and provided to the employee. Assign them a training buddy and provide the checklist to them as well.
Get Feedback Early and Often
Don’t wait for 90 days to have your first check-in with a new employee. Do it as early as possible. Consider an informal chat at the end of their first full shift or first full week. Create a written 30-day check-in that includes questions like “Have you been provided with the tools you need to do your job?” “What are you enjoying about working here?” “What can we do better?” How they experience their job will be mirrored in how customers experience your store.
When to Hire an HR Professional for Your Business
When your small business is approaching 50 employees, it’s a good idea to hire an HR professional. Of course, hiring one even sooner than that can’t hurt! HR professionals are skilled at recruiting and retaining employees, shaping company culture, and making sure you stay compliant—in short, HR has the potential to make a business a lot better. If you’re ready to hire a dedicated HR pro for the first time, these sample job descriptions from Indeed give ideas about how to craft a job description for an HR generalist.
How Eddy Hire Can Help Simplify Your HR Processes
Small business owners often wear a lot of hats, and administrative tasks can end up taking over. Eddy is an all-in-one HR software that simplifies HR processes by automating administrative tasks. With digital onboarding, time tracking, an employee directory, and more, Eddy saves time and money for small businesses. Eddy also offers solutions for hiring and payroll.
Questions You’ve Asked Us About HR in the Retail Industry
Milly Christmann is a high energy, operationally oriented talent management leader with extensive expertise in human resources, sales management, service and operations. She is recognized for collaborating with leaders to achieve their business goals by unleashing the power of an engaged workforce. By using process improvement, technology and strong, impassioned people skills as well as by attracting, developing and retaining top talent, Ms. Christmann drives change that matters.