The secret to keeping customers happy is to keep your employees happy. While staffing stores adequately is a major expense—more than half of a retailer’s selling, general, and administrative expenses, according to Bain & Co.—it’s absolutely necessary for the health and vitality of a brick-and-mortar, especially in today’s competing online environment.
While some retailers are slow to admit that good employees can be a company’s greatest asset, it’s clear to us that investing in your workforce is a must. In 2012, MIT researcher and retail expert Zenep Ton studied Trader Joe’s, Costco, and two other supermarket/convenience store chains, focusing on their above-average pay and consistent above-average earnings. Her research revealed that these companies defied the traditional theory that retailers have to hike prices to pay higher wages.
Ton remarked that these chains treated fair compensation as a strategic investment, and design operational systems to make their employees more productive, allowing them to offer better pay while continuing to offer low prices and pleasing shareholders.
At the beginning of 2016, Costco announced that it would be raising it’s starting wage by $1.50 to $13 an hour, keeping their employees happy and incentivized, and in turn, courtesy, helpful, and informed rather than absent or complacent.
So, take a cue from these successful retailers and invest in your in-store associates as well as employees across the board to create a positive, thriving work culture that unquestionably represents your brand.