(This article was originally featured as an op-ed in Retail Insider on August 19th, 2024.)
In recent years countless retailers have talked about “getting back to the basics”. We rarely hear explicitly what those basics are, and how they will return to modern operations.
This shouldn’t involve returning to old methods but about innovating those fundamentals to align with the demands of 2025. Doing so allows us to create dynamic stores that resonate with today's customers and thrive.
“I emailed the stores the visual merchandising guidelines with the due date. When the due date came, I manually reviewed our Sharepoint to see what stores uploaded photos to their store folder, and cross-referenced against the stores that didn’t. I then had to send reminders to the stores that didn’t. I then had to check back…”
- Director of Retail Operations, 42 Store Apparel Chain (with their shared sentiment below)
It is an all-too-common scenario that plays out in many stores frequently. It’s also only a single example (an in-store merchandising change) within a single retail operations function (visual merchandising). It would be foolish to think these occurrences don’t extend elsewhere.
Countless other examples that involve costly, manual processes across safety and compliance, commerce, training and development, hiring and recruitment, and elsewhere are choking store and associate productivity.
If you’ve been in the retail industry for 15 minutes, you know all too well stores have gotten busier and more complex. The intention with this piece isn’t to provide another ChatGPT-influenced verbal diarrhea whitepaper generically opining about “unified commerce”, “omnichannel experiences”, “focus on the customer”, or “stores are experiences”. We need less retail platitudes and a lot more tangible techniques.
What isn’t always obvious is the human and financial cost of these inefficiencies, and how the aggregate time loss from the visual merchandising example and the like add up.
Let’s look at an example eight-store district; these assumptions have been vetted with global retail operators, many of whom have run internal time studies. Let’s break down the maths:
So you want your stores to drive growth and unlock incremental revenue?
Well, it’s pretty hard when they remain bogged down by the operational inefficiencies and lack of process left unaddressed for the past 20+ years. Especially given what’s happened to stores and retail talent in that same 20+ years.
So no, the legacy “tech” in this conversation isn’t the hairy and complex POS & ERP projects. Rather the legacy tools that were never intended to be retail execution, operational, or communication tools; generic business applications older than most front-line workers today.
This is low-hanging fruit that is crippling store productivity, employee engagement and morale, and customer experience.
We’re looking at you: Email, SMS, basic checklists, single-point solutions, and 1990s Intranets.
Unsure? Have you talked to one of your district managers or store managers recently?
Next, let's explore the human element and how addressing it can benefit everyone involved.
“I joined this company because of the product and the brand, but we are so behind on the basics. Had I known how much more difficult my day-to-day would be from my last job, I would have thought twice before leaving. We have no tools, communication is all over the place, and there is so much extra manual work which takes time away from what should be the most important parts of my job.”
- New Store Manager 60 Days In
How long will this person stay in their role? And when they leave, will their employer chalk it up to “typical retail employee turnover”, or is this solvable?
Don’t kid yourself, “A-players” want to work with “A-organizations”. They have options; they value their time and their efforts, and they expect their time and efforts to be respected all the same.
They won’t put up with nonsense, and if retailers are unmoved to address the nonsense from their stores- the results are the results.
And this nonsense rears its ugly head in many forms.
A close friend joined a high-end US furniture retailer with over 50 stores twelve months ago. They became a top seller in the store after their first month. They love the product, the customers, and the earning potential, but their store culture is objectively toxic.
The store manager is underdeveloped and has received zero management or leadership training in the past 12 months, and supposedly has never received any. The store visits with the district manager are infrequent, superficial, and procedural at best. As the manager is underdeveloped, the staff lack development, so as one example, customer issues- which can be frequent in furniture- aren’t dealt with proactively which causes immense strain on the already understaffed store. Various staff issues boil over consistently as the root cause is never extinguished.
A good old-fashioned retail dumpster fire. Desperately needing leadership to extinguish the flames. All fixable “4-Wall” issues with the right focus.
You want your stores to drive growth? It’s nearly impossible when they are gasping for air, and handcuffed by inefficiency.
Mind you, these issues aren’t frustrating store system limitations, or waning foot traffic requiring capex, immense creativity, or complex solutions. These costly issues require a teaspoon of focus and a tablespoon of discipline.
So will the aforementioned employee stay much longer in the role?
You guessed it- no! They have been poached by a competitor, and that retailer will now look to replace a professional associate with $1.5MM in YTD revenue and customer relationships. Yeah, but that’s just typical retail employee turnover…
If you review the results of polls and surveys on retail employee turnover, the themes usually involve a lack of training and development, a lack of effective tools, or a lack of support and payroll.
All of these things are true, and can be true at the same time for any given retailer, but in the next chapter, we’ll cover an area that some visionary retail executives are focusing on, and one that many aren’t.
“You can hold a rock concert and that's OK. You can hold a ballet and that's OK. But don't hold a rock concert and advertise it as a ballet.” - Warren Buffet
Musically, that checks out, but in business software things have changed. As William Gibson said, “The future is already here; it just isn’t evenly distributed.”
Shopify, the dominating backbone of brands both infantile and behemoth is payments, store POS, e-commerce frontend and backend, marketing, fulfillment, capital and more. I wouldn’t bet on their reach getting any smaller- only continuing to expand to additional adjacencies, create more convenience and value to customers, and grow revenue and market share as a result.
WeChat, Asia’s superapp, is all things commerce, communication, productivity, and more. Large global chains forego implementing aspects of store technology adopted in their non-Asian markets due to how sticky and broad the preferred Chinese solution is.
Another macrotrend is the rise of vertical SaaS, software solutions purpose-built for their industry.
So what’s happening in the retail vertical? Tons of consolidation.
Workforce management solutions are getting cozy with the HR & Payroll stack.
The POS (point-of-sale) is becoming the hub for performance analytics, clienteling, traffic, and more.
Visionary retail execs and ambitious vendors have championed this strategy: prioritize and implement solutions that deliver more value across a broader spectrum of capabilities, while (hopefully) reducing customer spend, ensuring improved data quality and less integration lift, while demonstrating massively improved ease of use for end-users through fewer “logins”.
This signals the death of the retail point solution. And some retailers are very focused on it, but it’s not even in the realm of awareness for many.
As an example, the Learning Management System (LMS) is a 30-year-old point solution, offering limited capabilities for today’s workforce, in addition to its archaic authoring formats. This applies to all its derivatives: the Learning Experience Platform (LXP), the LRM, LRS…
But when you talk to most HR and L&D executives evaluating learning solutions, they aren’t aware. The cause isn’t ignorance of the solutions marketplace, it’s ignorance of the actual problems their store teams face.
In my experience meeting with hundreds of retail HR & L&D executives globally, I estimate that 25% at most have tangible retail exposure to front-line roles. Additionally, many of them have spent little - if any time in their stores, where the super-majority of their workforce resides. Combine that with reduced headcount across most retailers in HR & L&D and the knowledge gap becomes wider.
This puts these leaders in a disadvantaged position to evaluate solutions for their valued constituents. They are trying to solve a problem in 2024 with a 2005 level of understanding.
Now my intention isn’t to gang up on HR. Every executive from Ops, IT, Merchandising, and everywhere else needs to become problem-aware, get out of their silos, and align on prioritizing solutions that solve root causes- not symptoms, and vehemently replace what is ineffective.
Implementing a band-aid is for a superficial wound- not for the gaping wounds our stores and store teams are impacted by. Band-aids are tempting, however, as they provide an executive a “win” with minimal career risk and even less effort.
What are band-aids?
When problem-aware in retail, one recognizes band-aids that address symptoms, but not root causes.
And when one chooses to implement band-aids, it signals clearly to those who are problem-aware (often the front-line and their multi-site leaders) how much their time and contributions are valued, which in turn causes these wounds to become infected, a bacterial dividend that is passed on to customers.
In conclusion, if executing on solving the root causes of the issues in your stores for your employees and customers isn’t a good enough reason, then do it because your competitors are.
There are no retail silver bullets, but there are retail solutions.
Ray Riley is the CEO of Progress Retail, a retail operations and learning platform streamlining how multi-location retail stores train their teams, execute tasks in-store, and communicate across their frontline. Canadian and global retailers such as Pilgrim, Little Words Project, Andrews, True Religion (ZA), Secrets-Shhh, and more leverage Progress Retail to boost store productivity, decrease employee turnover, and run profitable stores.
