How To Improve Retail Operations Management to Get Ahead of The Game
In Vietnam, the retail model is the most common business type, which fits many conditions while also satisfying the consumer needs. An effective retail store operations strategy is very critical in the beginning to build up a solid brick-and-mortar and online store.
Not to mention, making your retail operations more efficient will help you get further ahead of myriad competitors in the market.
What Are Retail Operations?
The term retail operations refers to all of the activities needed to run the store efficiently, also involving processes and systems within a retail store that have a direct impact on the business sales and customer shopping experience.
While business development and retail marketing are dealing with gaining new customers, operations are concerned with meeting the demands of buyers who enter a physical store or visit an online establishment.
Retail operations refers to all of the activities needed to run the store efficiently
Retail store operations are made up by the following components:
- Order fulfillment
- Supply chain management (or logistics)
- Customer service
- Inventory and stock management
- Visual merchandising
- Cash operations
- Loss prevention
- Staff training
- Promotions and pricing
- And data management aspects
It's a lot to handle and balance, and successful store retailers are those who can accomplish this.
Why Are Retail Store Operations Important?
Retail operations might potentially play an indispensable role in bridging the gap between corporate offices and stores. That role is to make sure of every action accounted for, reducing losses due to wrong or inaccurate conclusions or deployments, and guaranteeing a smooth and uniform customer experience.
On top of this, this concept remains true for retail of all descriptions, including groceries, convenience stores, fashion shops, etc. Simply stated, the operations have a great influence on a retail business.
In addition to that, the optimization of store performance can gain manifold positive outcomes. Here are some of the reasons why you should give a boost to your store operations management.
#1. Reduce Employee Turnover
Retailers need a store workforce to do a wide range of tasks in their stores, including assisting customers, processing transactions, handling new shipment arrivals, organizing inventory, and arranging items.
However, they already have an enormous challenge when it comes to maintaining personnel, with an employee turnover rate in the industry reaching up to 60% and costing about $19 billion each year.
That is why retail companies must review and enhance any areas that could aid in reducing turnover, including retail shop operations.
Improved training can increase employee engagement by 27% by optimizing your workforce and customer service. Furthermore, by automating essential business processes and repetitive chores, companies can eliminate time-consuming administrative tasks from their workers' workloads while keeping them engaged in work they genuinely value.
At the end of the day, happy workers are more likely to stay longer and devote themselves fully to the job.
Retailers need a store workforce to do a wide range of tasks in their stores
#2. Improve Customer Retention
Because of the extreme competitiveness of the retail industry, many businesses are constantly striving to satisfy their customers by creating high-value and personalized shopping experiences for them.
And loyal customers are the most important ones, with repeat customers accounting for 65% of a company's revenue. It is a well-known fact in business that keeping an existing customer costs less than finding new ones. Accordingly, the return of customers also saves costs for your business and improves your profit.
So how do key functions of retail operations have an impact on retaining customers?
Some shop buyers may conduct internet research before making an offline purchase, or vice versa. Additionally, if consumers come across contradictory pricing, product catalogs, or business information, they won't contact you again.
Concentrate on creating a consistent experience across all sales and marketing channels, which include your retail outlet. Higher revenues and profitability are expected if you provide a reliable customer service experience. It is because satisfied customers will put trust in your store, increasing the likelihood of repeat transactions.
A well-trained customer service crew, an inventory that meets customer wants, and a well-functioning process can also ensure an exceptional customer experience.
Many businesses are constantly striving to satisfy their customers
#3. Lower Costs And Drive Sales Growth
Increased sales are a foreseeable outcome of a well-run store. Consider the sales process: the customer is attracted by the visual merchandising, chooses their product from good customer service, and enjoys a hands-down checkout due to an effective, technologically-optimized Point of Sale (POS) system.
73% of organizations with exceptional customer service outperform their competition in financial affairs.
The seamless inventory management system also contributes to a good supply of goods. By doing it well, you can prevent out-of-place products in your stock and increase the chance of selling them to your customers immediately.
Common Types of Operations in Retail Stores
The specific responsibilities needed to operate a retail store vary according to its size. There are different kinds of operations that cover most retail stores' everyday tasks and duties, but the following are the two most common of them:
#1. Visual Merchandising
This involves enhancing the visual appeal of your store by optimizing its layout, lighting, displays, and product placement to attract customers and increase sales.
Given that people respond strongly to visual stimuli and images play a crucial role in purchasing decisions, improving your visual merchandising can be incredibly valuable.
#2. Inventory Management
This is the practice of ensuring that your store has the right products in the right quantities to meet customer demand.
Effective inventory management can reduce inventory costs, drive sales growth, and minimize instances of out-of-stock items. It requires a deep understanding of your customers' needs and preferences.
How To Improve Operation Management In Retail Stores?
#1. Limit Paper-Based Tasks
As the number of retailers using technology increases, some will need to expand their business further and digitize manual tasks that affect business optimization.
Digitizing daily tasks will help empower your employees at work and help them complete the job with the highest standards. Particularly, digital solutions could assist in checking inventory on a tablet and delivering accurate product information to customers in real time.
Another benefit of digitization is to help businesses collect information and analyze it into useful data for business. FieldCheck is an example of a digital solution that helps employees do their daily work on a mobile device. At the same time, the solution also enables real-time data monitoring, providing tailored customization for timely solutions.
Another benefit of digitization is to help businesses collect information
#2. Digitizing Workflows
To keep up with technology trends, automation and digitization of work processes are necessary for retailers impacted by rising labor costs and changing customer needs.
Store managers spend 3-4 hours a day handling administrative procedures. This makes it difficult for them to grasp the situation at the store and deal with potential problems.
Tasks like checking visual merchandising compliance and monitoring the number of SKUs can give better results if automated and digitized, leaving you more time to improve the customer experience.
Some of the workflows you can digitize include:
- Employee time attendance process: Instead of using an expensive fingerprint timekeeper, you can let employees check in/out on the mobile application.
- Sales process: You can easily use the mobile app to enter your daily sales. After entering the numbers on the number of products sold, you need to click Submit. Immediately, the data will be updated on the system in real-time.
- Customer service process: The mobile application will make it easier for you to collect customer information. Fully collected customer data will make it easier for retailers to perform product display and loyalty program tasks.
In the past, this task was done on paper, easily leading to data entry problems, omissions, and loss of customer collection documents.
- Reporting and troubleshooting workflows: Digitizing workflow helps managers better understand store operations. The store manager can also catch or be notified early when any incident occurs. This is thanks to a technologically optimized process.
Accordingly, employees can use mobile applications to report incidents by taking photos, taking notes, and sending them directly to relevant personnel. This saves some reporting time and speeds up the troubleshooting process.
Automation and digitization of work processes are necessary for retailers
#3. Ensure Clear, Up-To-Date Inventory Management
One of the ways to improve retail operations management is always to ensure a clear inventory count. This is because when inventory is tightly managed, stakeholders, including store employees, can provide accurate product information to customers.
Besides, the stores also do not have the problem of lack of goods or missing sales opportunities to increase sales for the store.
#4. Supervising And Training Employees
Thanks to the real-time mechanism of digital applications or software, the information reported by employees becomes more transparent. Management can rest assured about cases of dishonest work.
Management can evaluate each person's work productivity based on the tasks and reports from employees. From there, staff monitoring and training plans can be more optimally supported.
#5. Leverage Analytics Data
Traditionally, when the data is collected on spreadsheets or paper, the back-office staff will enter it into the system and analyze it later.
In fact, according to a representative from KAO, the process of completely collecting information and entering it into the internal system takes about 3 weeks, consuming time and workforce for data collection work.
To improve the above problem, the digital solution will help automate and synchronize input data to produce visual analysis charts. You will need to enter any formulas to calculate the data sent from your employees.
The analytics will be generated automatically when any metrics are updated on the system. Based on these charts, you will get a rough overview of the business situation. At the same time, they allow you to have a basis for making better store operating decisions.
Digital solution will help automate and synchronize input data
Wrapping Up
So now you know how to improve retail operations. As you can see, the improvement is not based on one single task. Instead, it needs the combination of different factors from human resources, system and business processes,
To keep up with the digital transformation trend, today’s retailers are better to apply digital solutions to automate their operations while enhancing business productivity and supporting sustainable development.
FieldCheck integrates a range of features to help frontline staff and management do their tasks efficiently. For employee attendance, our digital solution allows users to check in/out with ease with their devices.
For tasks, the supervisors can create or build tasks on a web-based admin system and assign them to staff without sending any emails. This streamlined process can save time from conducting multiple-step procedures.
There are also graphical analyses for the administrators to catch the business trend. Other features of ticket management or photo report allow employees to report to the persons in charge without any hassle.
Anything else? Yes, our solution still provides some other features to help you run your store smoothly and seamlessly. Contact us now for instant support.
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