Your most valuable asset

If you want your employees to grow with your business, train them carefully and treat them right. No matter how well you watch cash flow, manage inventory or make your store attractive to customers, you will lose business if you don’t develop your employees.

In a service industry like specialty retail, the contact between the salesperson and the shopper can make or break the bond between your business and your customers. Many retail owners, however, fail to recognize how important that connection is.

In too many independent retail shops, training sessions consist of showing new employees how to punch the time clock, how to run the cash register and where to take breaks. Once these skills have been mastered, employees are pretty much on their own.

But to be as effective as they can be, your employees need more instruction.

Doing a poor job of developing employees’ potential can result in a high turnover rate, along with a general lack of motivation and bad customer relations habits. Employees will be more interested in coffee breaks, texting their friends and quitting time than taking care of customers. Thus, they will produce far less than they would if they were highly motivated and trained.

Nurturing and maintaining strong frontline salespeople and support staff is far better than dealing with constant employee turnover.

Here is a three-part process we encourage you to apply to your retail operation.

If employees are doing a good job, tell them. Many workers say expressed appreciation from an employer is their No. 1 priority. Photo by Ryan Cutler.

Step #1: How are you doing so far?

This short but thought-provoking quiz can help uncover any hidden problems you might have within your employee relations.

Answer “Yes” or “No” as honestly as you can to each of these questions.

If all your answers are yes, you are doing a wonderful job. However, if some come up negative, then you’ve found places where you can improve.

Employee Management Quiz

1. Do your employees know exactly what you expect of them?
2. Have you provided each employee with a written job description clearly explaining each of their responsibilities?
3. Do you routinely give them constructive criticism and encouragement?
4. Do you use at least one of the following employee-employer communication methods: regular, private individual conferences; informal on-the-job discussions; a formal method of bringing suggestions to your attention; or group meetings featuring open discussion of issues employees want to raise?
5. Do you recognize and reward outstanding performance?
6. Do you have an ongoing training program that includes training on merchandise, design, selling techniques and customer relations?
7. Is your employee benefit program competitive?
8. Do your employees understand their benefits thoroughly in order to take maximum advantage of them?
9. Are your wages competitive?
10. Do you follow a formal system of pay raises? Do your employees understand what they have to do to earn raises?
11. Do you have a formal system of promotion and do your employees understand the basis of earning a promotion?
12. Did any of your supervisors or managers start at entry-level jobs in your business?
13. Do you try to discover each of your employee’s strengths and allow each to contribute as much as possible from those strengths?
14. Are your stores (and your offices) bright and cheerful places to work?
15. Are your employees generally happy working in your business?
16. Do your employees know your long-range goals? Do you tell them how their performance measures against those goals?
17. Do you have a formal program of sharing your business’ profits with your employees?

Step #2: What are the top priorities for employees?

How important to your employees are the factors that were probed in the quiz? Very important, according to nearly every study of employee attitudes we’ve seen.

Emotional and qualitative rewards frequently rank highest for contributing to employee satisfaction. Money is behind emotional rewards, but still near the top of the list.

Here’s how these studies would rank the top 10 priorities for employees:

1. Expressed appreciation from employer for work well done.
2. Knowledge of what’s going on in the business and the owner’s goals for the business.
3. Management’s understanding of employees’ personal needs.
4. Job security.
5. Good wages and benefits.
6. Interesting, challenging work.
7. Opportunities for growth in responsibilities and compensation.
8. Management’s loyalty to employees.
9. Good working conditions.
10. Tactful discipline.

Now, look again at your answers to the quiz. Based on your candid assessment, how strong is your business in the things that matter to employees?

In today’s candidate’s market, employers need to be competitive to keep employees motivated and happy. Photo by Gary Delp.

Step #3: Get some real feedback

We urge you to give the quiz from Step #1 to your employees. Have them fill it out and return it (anonymously, of course).

Often their perceptions will be markedly different than yours. They might, for example, be concealing ill feelings and misunderstandings they are afraid to mention for fear of losing their jobs.

If there is a pattern in their answers that doesn’t match yours, think about the reason. Any dissatisfaction they feel, no matter how hard they try to hide it, will surface when they talk to customers. That is when it will hurt you most — at the point of sale.

Remember, this isn’t a popularity contest. Instead, this is aimed at making your stores be the best possible experience for the customers.

So, put these findings to use. Make needed changes to increase effective communication and improve the satisfaction of your employees.

But don’t stop there. After implementing your improvements, give them the “accountability test.” Check your sales and profit results in a few months to see whether the commitment has been worth the effort.

Our prediction?

You will find sizable rewards for your efforts — not only in your staff’s morale, but in your sales and profit figures as well.

And your customers will be the most pleased of all.

Patricia M. Johnson and Richard F. Outcalt are certified management consultants and co-founders of The Retail Owners Institute. They are strategists for retailers, workshop presenters and publishers of a free and popular newsletter for store owners and managers. Sign up for The ROI News for free at RetailOwner.com. They can be reached at 206-623-3973.