What’s your first impression when you walk into a store, hotel, or restaurant? Do you feel welcome, or is it a cold reception? Do you receive a friendly greeting, or are you ignored? These first impressions make all the difference. And who holds the key to that first impression? The frontline worker in retail and hospitality.
While corporate leaders in these industries spend hours around conference tables working on brand image and write “omnichannel first” and “guest experience always” on whiteboards, the reality remains that the interaction between customers, guests, and frontline workers often forms an indelible image of the brand. High stakes, right?
But the support that retail and hospitality give frontline workers doesn’t always match up to those high stakes. The turnover rate in the U.S. in 2018 for retail was anywhere between 60% and 70%, and 73% in hospitality. The average for all other U.S. industries is 15%. Those numbers aren’t promising for frontline workers or the companies they work for.
The cost of replacing frontline workers is significant and means starting over with recruiting, onboarding, and training.
While the nature of retail and hospitality work can be seasonal or short-term by design, it’s not always the case. In some cases, starting out on the frontline leads to a long career in that industry. In retail, for example, we learned on a recent Workday podcast that 75% of Walmart store managers started out as hourly associates, and rose through the ranks through thoughtful training and development. So the potential benefits for keeping high-performing frontline workers on board are high.
On the flip side, failing to do what it takes to retain frontline workers can take a toll. The cost of replacing frontline workers is significant and means starting over with recruiting, onboarding, and training. And that restart is likely to make an impact on the customer experience, as customers will often be interacting with workers still getting up to speed.
So why do frontline retail and hospitality workers leave their jobs, and what can retailers do about it?
Frontline retail and hospitality workers face a plethora of challenges. Schedules can be unpredictable, and they’re called on to provide excellent customer service even when customers are challenging. The customer may not always be right, but frontline workers often have to think that way. Sometimes they leave because they don’t feel adequately supported. And they may leave because of lack of training. A recent survey found that 38% of frontline retail workers received no formal training, and even when they do, 27% said it was ineffective and not engaging.
A lack of career development opportunities is another reason that frontline workers jump ship. They play a vital role in the success of the retail store, hotel, or restaurant, and they don’t want to be viewed as expendable or just short-term help.
Bad technology experiences also play a role. Nearly 80% of the retail workforce are from Generations X, Y, and Z, and they have high expectations for the technology they interact with. If they’re relying on clunky technology to track time and attendance, request time off, and see their pay information, a frustrating experience may lead them to quit. And hospitality companies will find similarly high expectations from their workers, since nearly half of Generation Z say they’re interested in a career in hospitality.
A recent survey found that 38% of frontline retail workers received no formal training, and even when they do, 27% said it was ineffective and not engaging.
So, how can retail and hospitality companies avoid the negative impact of not enabling frontline workers? Flip these issues on their heads and invest in the long-term growth of the people who staff your hotels and stores. Make sure the technology they rely on is user-friendly and reliable. For 82% of workers under the age of 34, technology is an important factor in choosing a job.
Invest in making training engaging—less sitting in the classroom, more self-directed, interactive, and in virtual classrooms. Less pen-and-paper, more mobile apps and videos. Companies that rethink training often find that they lower turnover and raise customer retention. And supporting learning opportunities (like Taco Bell’s partnership with Guild Education and Walmart’s tuition assistance) goes a long way in encouraging employees to stay with you.
Focus on developing the skills that your frontline workers bring to the table, and develop the new skills that they’ll need to thrive in the changing worlds of hospitality and retail. It’s not just about job descriptions and titles anymore, it’s about connecting employees to opportunities that match their skills.
And finally, make career development and guidance a top priority. Effective talent management is paramount in industries with such high turnover risk. Like the Walmart statistic about the majority of store managers starting as hourly associates, when you invest in your people, they’re more likely to grow with the company. When they have an idea of where their next step in the company could be, their path forward is less likely to lead out the door.
The stakes are high when it comes to frontline retail and hospitality workers. To reap the benefits and steer clear of the pitfalls, focus on technology, training, skills, and career development. Start with the front line, and see how it helps the entire organization.
Are you going to NRF: Retail’s Big Show in January? Swing by booth 1053 to see how our single system for finance, HR, planning, and analytics can help you support frontline workers and get ahead in the changing world of retail.