As a franchisor who sells retail recruitment franchises Frontline Recruitment Group is in a unique position to comment on key issues for recruitment in the retail field. In this article, Peter Davis, Managing Director, Frontline Recruitment Group, provides an insight into recruitment in the retail sector.
Running a successful franchise is a juggling act. Managing cash flow, recruiting staff, opening new branches, branding, training - the list of tasks is daunting. But there is one thing retailers agree on, the first thing you need to get right is your people.
Retail market overview
There are mixed signals coming out of the retail sector now. What is not in doubt is that the retail industry will remain fiercely competitive. Winners and losers will emerge in every sector as retailers react with varying degrees of success to changing consumer behaviour and demand. The ability to deliver an efficient and attractive retail proposition will be the key to their ultimate success, and that comes down to their frontline staff. For all retailers, the retention and motivation of talented staff across all functions will become increasingly important. Investment in people is a prime strategic goal for retailers. According to Australian Bureau of Statistics figures, there are more than 77,000 retailers in Australia, operating more than 200,000 retail outlets, and producing more than $200 billion in annual sales. It is estimated that more than 50% of the adult population is currently working or has worked at some time in their life in the retail industry.
A land of opportunity, one might think, but retail also has a reputation for low morale and high turnover at store level. A negative image, which has not been helped by one of the toughest recruitment markets retailers have had to confront in the past ten years.
The war for talent has changed recruitment practices
Five years ago at Frontline Recruitment Group the average time between a position being listed and that position being placed was 28.7 days, now it is 18.6 days, this means recruiting speed has increased 35% in 5 years. The speed of recruitment in this tight labour market means you have to move quicker than ever before, candidates are going for interviews, receiving multiple offers in the same day so it is all about speed in the process, and understanding the generational issues associated with the candidate.
Retail organisations are starting to discover that the secret to attracting and retaining valued staff has less to do with money and is more about creating a culture people enjoy being a part of. One of the greatest drivers of your team's success is their level of engagement. Engaged employees are less likely to resign, unlikely to call in sick when they are not sick, consistently do more than what is required, and have far greater levels of quality and productivity. Retention of key personnel is paramount to success in a tight labour market with narrow cost margins and escalating wages.
So what are retail candidates looking for and what issues does this give rise to for employers?
Work-life flexibility
The retail industry is characterised by a high degree of casual, part time and seasonal employment and high staff turnover rates mean retail shops face continual recruitment and training challenges. Australia has the second highest rate of part-time work in the developed world and those workers are among the best paid. The liberalisation of workplace laws and awards has made it easier for businesses to hire part-time staff, while trends such as the expansion of higher education has created more demand from employees for part-time work. To attract the best staff the retail sector has to look at flexibility in the workplace for students, parents returning to the workforce and the ageing population who still want to contribute to the workforce.
Higher Salaries
The 2007 Frontline Retail Salary Guide indicated that Sydney, Perth and Brisbane all experienced growth in salaries in all positions. And it was the fifth consecutive year Brisbane salary levels exceeded those in Melbourne.
The findings were consistent with a market that is experiencing a candidate shortage and one in which candidates know their market value. The increases also support the strong growth in casual part-time work where the relatively high pay loadings make working this way more attractive than in other countries. In Australia the hourly pay rates for part-timers are 93% of full-time rates whereas in most other OECD countries pay for part-time workers is "considerably lower" than for full-time staff. With salaries on the move upwards it is more important than ever to recruit the right retailers into your organisation and keep an eye on salary surveys to ensure you are paying market rates to keep them there.
Cross-generational workforce
There are three generations currently working side-by-side in the Australian labour market: Baby Boomers (b. 1946-1965), Generation X (b.1966-1980) and Generation Y (b. 1981-2000). Each generation has distinct characteristics that affect how the war for talent is waged. Baby Boomers have a stronghold on the labour market due to their sheer size and to attract them companies need to be age friendly – giving employees opportunities to contribute to society, providing a flexible workforce that balances work and retirement and empowering them. Generation X greatly value a work-life balance, this group is hungry for success, they long for flexibility and opportunities to excel with organisations. Generation Y is by far the most confident as they grew up in a society that placed high attention on individual self-esteem and self worth. They want to be involved in the company’s shared crusade, are lifestyle centred and want quick rewards. A major challenge for companies therefore involves understanding each generation and bridging the gap between generations.
For retailers it means attraction and retention strategies have to appeal to these three groups. Flexibility surrounding packaging, flexibility, candidate experience, and the consideration of transferable skills across sectors enables retail companies to expand the pool of available candidates.
Not just a job in a shop
The Retail Industry once considered an industry with few career prospects is now perceived as an industry that provides many opportunities for customer-orientated people to achieve and progress. Retail companies in Australia are offering school leavers and graduates career paths in Retail that include comprehensive training programs, financial bonus systems and attractive career advancement opportunities. Retailers that hope to attract top performers need to accentuate the careers available in Retail and position their companies and roles as more than 'a job in a shop' or as a 'filler' till they find ' a real job'. This needs to be balanced with the need to facilitate flexibility with hours for part-time and casual employees.
Who makes the best retailers?
In most unskilled roles employers evaluate and employ staff based on previous experience and when they let them go, it is usually based on their 'attitude'. The best retailers have an incredible 'attitude' they love the product, love what they do and love the interaction with people. They have to be passionate and enthusiastic, they have to demonstrate a desire to help people, they need to have a balance of sales skills and enjoy the thrill of the chase, and this all needs to be balanced with a desire to provide outstanding customer service. The best retailers are genuine, real people that build rapport and relationships with their customers. Think about your friends and why you are drawn to them and it is generally because of their sincerity and commitment, the best retailers exhibit these same characteristics.
Peter Davis believes we need to turn the paradigm of recruitment on its head - hire on attitude and fire on skills. You cannot teach someone to be passionate, outgoing and to love what they do but you can take those raw ingredients and train them to be successful retailers and give them the skills they need to be successful.
So who makes the best retailers? Those candidates that want to be the best, and you will know it as soon as you meet them.
About Frontline Recruitment Group
Frontline Recruitment Group is a national network of franchised industry specialist recruitment Agencies. The Frontline Recruitment Group was established in 1995 and has expanded at an impressive rate to become one of the Asia Pacific’s leading retail recruitment consultancies. Today, the company continues to set the standard for industry specialist service with a personal touch in the retail recruitment sector.