Retail Staff Turnover Is High: Is It Time We Simply Accept This?
Let’s face it: everyone knows that retail turnover is high—much higher than most industries.
But what does that mean for your stores going forward? Should you try and fight a doomed battle or just save money on staff training, knowing they’re probably going to leave soon?
Heads-up: you might not like the answer (but, if you want your stores to succeed, it’s not a good enough reason to ignore it).
The retail industry and staff turnover: a troubled relationship
Let’s start by putting retail turnover in perspective.
Average employee turnover rate in retail
The average retail turnover rate is 60.5% in the US and 57.3% in the UK, meaning that more than 1 in 2 members of staff will leave a company within the year.
When you compare it to the average turnover rate (15%), it makes you realise just how ridiculously HIGH it is for the retail sector.
Why is turnover high in retail?
There are several reasons why retail employee turnover is higher than in most industries:
Low salary
Lots of competition
High pressure and stress
Not an apparent career ladder
Challenging and often unpredictable working hours
Many staff members are students, part-timers, and temporary workers
Basically, retail turnover has always been higher—and will probably always be that way—due to the very nature of this sector.
Ok, retail turnover is high (fact). Now, what should you do about it?
Many CEOs and store managers have come to this conclusion: “if retail turnover is so high and will stay that way, there’s no point in investing in my staff. After all, most of them will leave!”
Well, that’s actually the easiest way to shoot yourself—and your store—in the foot.
1. You should still train your staff properly (yes, even if some of them will leave)
Failing to train your staff—and, especially, your front-of-house staff—is a dangerous game. You’re basically playing Russian roulette with customer service!
Fixed-term contracts aside, you don’t actually know who is going to leave and when. Are you really not going to invest in all of them just because you could risk spending some money on someone who ends up jumping ship?
When you don’t train your staff properly, you’re penalising your store. To survive retail’s phygital age, you need to make your in-store experience so valuable that customers will want to pop in and return—even when they could easily choose to buy everything online. You can’t do that if your staff isn’t knowledgeable, engaged, and motivated
You should never underestimate the capabilities of anyone in your team, including the student who only works weekends and that 8hr part-timer. Everyone should be responsible for providing an outstanding customer experience. Let’s say that a potential customer walks into your store and is greeted by a member of staff who only works one day a week: does that mean they should get lower-quality, basic service? Well, not if you want them to come back!
Plus, just like you don’t know who’s going to leave, you never know who’s going to come back. If someone has great memories of your brand and leadership, they might easily return after a few years (I’ve seen this happen countless times!)
2. Try and figure out why the retail turnover rate is high in your stores
Just because the average retail turnover rate is around 60%, it doesn’t automatically mean it’s going to be the same for your store (or that it has to stay that way).
Many companies talk a lot about retaining talent but don’t do enough about it in practice.
I noticed that, while some stores do try and implement some changes, they execute them through a very diluted pilot version. Of course, that doesn’t end up having enough of an impact (and they give up on retail employee retention shortly after).
So, gain an advantage over the rest of your competitors by understanding exactly why most people have been leaving your retail stores so far.
This could be because of poor management or a lack of leadership (remember: in most cases, people don’t leave jobs. They leave managers!). Maybe there are cliques that have led to a toxic environment. Perhaps there’s too much tasking but not enough organisation?
Whatever it is, you shouldn’t rely on guesswork to try and lower your retail turnover rate!
Conduct thorough confidential exit surveys, and yes: even with part-timers and students. Sure, they might be leaving because they’re going back to their hometown, but that doesn’t mean they haven’t got any useful feedback for you
Monitor and measure employee satisfaction, one of the top retail KPIs in the phygital age. Have 1:1 meetings and run employee satisfaction surveys regularly to measure your eNPS (employee net promoter score)
Don’t get me wrong: I know that learning these things and facing these pain points isn’t always easy. However, ignoring them isn’t a solution. Even the smallest problems can turn into much bigger issues if left unchecked.
When you’ve identified them in your stores, you can use this feedback to make informed decisions, start moving towards a better direction, and set things right.
3. Do better (a lot better) than average retail stores
Do you want to have a lower retail turnover rate than most stores? Then, you’ve gotta do more for your staff than the average store does.
Train them properly and keep them engaged: organise some sessions or team building workshops. After all, 94% of employees would stay much longer if a company simply invested in their learning and development!
Make sure your store managers are inspirational mentors who work with the staff and keep them motivated. It’s time to move away from ‘store operators’ to ‘store leaders’
Encourage career progression within your retail company. As we’ve seen before, the lack of a traditional career ladder is one of the reasons why the retail turnover rate is so high… but retail does have a career ladder! You just need to make this clearer to your staff, especially when monitoring their feedback and satisfaction rates. If someone is tired of being on the shop floor, they might think that the only solution is to look for a different job altogether. Instead, you can talk to them about your brand’s opportunities in marketing, visual merchandising, event hosting, corporate roles, and more
Act BIG! Consider paying your staff around 20% above the market average. If you think it’s extreme, ask yourself: what is the cost of replacing more of them frequently? And I’m not just talking about the financial cost (which is 16% of their entire salary for low-paying positions and 20% for mid-range roles): think of the disruption and all the negative ripple effects that it’ll have on the rest of your staff, which can also create a vicious cycle
Implement retention bonuses with the caveat of not resigning within three months of receiving them. In the worst-case scenario, this 90-day period will give you plenty of time to get ahead of the game when it comes to HR and recruiting. Still, more and more people will actually decide to stay!
Basically, retail turnover will always be high, but you can make a difference in YOUR stores
Overall, my advice is to accept that retail staff turnover is higher than average and still strive to do better.
Think about it! Most stores don’t do anything to make this sector more appealing and retain their staff, especially when it comes to front-of-house roles. Instead, you can be the catalyst of change.
Sure: due to the nature of the job, some people will still leave… but the percentage doesn’t have to be as high as 60% of them!
So, keep on—or start—providing a superior experience and an above-average work environment:
Fewer of your staff will leave
More of them might end up coming back
Your workforce will be more engaged and motivated
You’ll always provide the best possible in-store experience to your customers
Your brand will not only survive during retail’s phygital age: it’ll succeed and thrive
Let’s lower retail turnover for your brand!
Not sure how to put all of this into practice successfully?
With over 20 years of experience in this bustling sector, I can help.
I’m Kayleigh, the founder of The International Retail Academy. Even though the high street has been struggling for a while, we’ve been helping premium retail brands grow and prosper.
Of course, staff training and retention is key. So, let’s figure out exactly how to lower the retail turnover rate in your stores and set you up for success.