Over the past few months, I have given three seminars to groups of
retailers, plus spoken to many of you one-on-one. A topic that came up
continually was how to find, develop and keep a good strong staff. This is
not unique to our business, but a challenge in many industries. In this
article, I hope to give a few suggestions to help.
#1 – Hiring staff
Here is a technique that may help during the hiring
process. (I will not cover what you legally do in an interview. There are
books you can buy on this subject)
For every potential employee you interview, take a piece of paper. Make
three columns, the first with the heading “BE”, the second “DO” and the
In the BE column, write everything you can about the candidate’s
“being-ness”. Do they have enthusiasm, interest, and passion for working in
your store? Do they “look” the part? Do they live a healthy lifestyle? Do
they have good manners? Do they smile easily?
All your observations toward this part of the interview center around
whether they have the personality to work in your store. A big criterion is
that you like the person. Working with people you like makes for a better
day at work and a better store “atmosphere”. You can train knowledge, but
it is almost impossible to change a personality. There is a good book,
”The Platinum Rule”, which has a short test that identifies the general
personality of a person and can help find people who will do well in sales
and those in accounting.
In the “DO” column, make notes from the questions you ask to determine if
the candidate can do the job. Ask questions around the specific duties you are hiring them to do. You may also need to give them a test to ensure
they can do the job. For example, if they are going to work on cash, you
need to see if they can do simple math for giving proper change. Can they
calculate discounts, can they lift heavy boxes, do they have product
knowledge on natural products, can they work weekends or nights etc. This
part is fairly straight forward, for even if they have a stellar
personality, but cannot perform the duties required, they would be hard
pressed to qualify for a position.
Column three, HAVE, requires you to dig deeper for the information. This
area is usually overlooked or not recognized as important. Here, you look
at what the person has done with their life. This probably is the most
important determining factor and, if followed, would result in less
post-hiring “surprises”. During this part of the interview, focus your
questions on what they have accomplished in their life. (Remember what a
person has done in the past often results in what they will do in the
present…habits determine 90 per cent of a person’s current actions).
Depending on the age of the person, what has been done will be different.
As an example, say you have a young person, new to the work force. Ask
them what their interests are, what outside activities did they take part
in at school, what activities have they excelled at, piano, sports, church,
housekeeping, etc. or do they just hang out and expect life to provide for
Or maybe you have a woman who has been out of the work force for 20
years while she raised three children that have become good citizens in the
community. I do not have to tell many of you what it takes to raise
children and survive…next to this, retail is a breeze. Many times, these
women raised the children while also performing community activities,
helping at school, and the many other tasks that fall to stay-at-home moms.
Perhaps your are interviewing a retired gentleman who spent 25 years
working his way up from an entry level retail position to management. He
may want to still keep active part-time and his previous experience may be
an asset to your own retail management. I must emphasis the importance of
this part of the interview again, for it is so important: a person’s past
actions will almost always determine their present actions.
If you find a person who qualifies in all three areas — BE, DO, HAVE– you
have a good chance of that person working out.
As a last comment, you also need to review your current staff, as it
sometimes does not come down to who you have hired — it is who you have
#2 – Paying Staff
I put a lot of emphasis on the importance of recognizing the fact you are
in the selling business and each person in your store is a salesperson.
In selling natural products there is a fairly high knowledge base required
and expected from your customers. The challenge has been how to pay your
staff so they make the extra effort to be more than just a clerk.
I understand that staffing is usually the greatest expense on your profit
statement. However, staff needs to be recognized as your greatest asset.
Following are the four most common ways of paying your staff,
Base Pay – This is the entry-level pay to work in your store. You need to
base this on similar retail business in your community. Do not work from
the premise of how little you can pay but expect by paying a little extra
you will be able to expect and get extra from the person.
Skill-Base Pay – You need to examine at all the various activities to run
your store that require extra skill [knowledge] to perform. This could
include buying, doing the bank deposit, overseeing a department, opening
and closing, etc. Each function should have a pre-set extra value.
As an example, you may hire a person at $10 per hour and set down your
expectations that, after three months, you want them to be able to perform
additional tasks, each with a pre-determined value. For example, running
the cash would be worth an extra 30 cents per hour, facing the store 20
cents, and outstanding customer service could earn them an extra 50 cents
At the employee’s three-month review, you could sit down with them and look
over how they have improved, and increase their pay accordingly. Let’s say
your next pay level was $1.00 extra and the employee scored an 80 per cent
out of 100 on the tasks you had assigned. Their accomplishments would
result in an increase of their pay of 80 cents per hour. If at this point
you felt this person had the skill to take on more responsibility, then you
could set out more objectives to take them to the next level or you could
let them know that when they improve in a few areas you would give them an
extra .20 cents per hour.
I do not want to say in this article what I think are fair wages, for fear
of the wrath of retailers who pay less. However, I have always paid more
than the industry average. I know many stores pay minimum wages and it’s no
wonder they are getting minimum results.
Commission - I understand if you have concerns of paying commission. It
brings up images of strong-arm tactics and forcing people to sell more than
a customer needs. Remember the golden rule of sales is to “never sell more
to a customer than you would buy if in the customers shoes”. Commission is
really a way of recognizing individual performance. It need not just be
monetary, but could be in the way of dinner coupons, time off with pay,
free product from the store, day at a spa or cash. The individual
performance does not always need to reflect around “closing” a sale but
could be for a great window display, great floor displays, keeping their
department very clean, compliments from customers, staying late to help
during a crisis, etc. You need to come up with creative ways to recognize
good work and acknowledge this with a reward. People love to be recognized
for their efforts beyond just the paycheck, so I suggest you look at this.
My caution with this is you develop a commission [reward] program that
directs the person towards your business goals and the program is
consistent and fair.
If you do not have some way of rewarding individual performance I suggest
you look into it. There are good books on 1,001 ways to reward staff.
One note: to create commissions based on sales, you need good computer data.
Bonus – A bonus program should be a TEAM based reward. This is a way to
recognize all staff when your corporate goals are being met. This can be
rewarded with other rewards similar to what we mentioned in commissions.
However, I will focus this on money only. For this, you need accurate
financial statements, and if you do not have these, please make it priority
one before doing anything.
Profit sharing bonus – To survive and thrive requires your business to make
a profit. By having a profit share program and a clear understanding of how
each person can contribute to a stronger bottom line will ensure each staff
member helps you reach your business goals. Generally, an employee should
be employed for at least one year before profit share kicks in. As an
example, say a company takes 25 per cent ($30,000) of its pre-tax profit to
share between all staff. This amount is divided by a few factors but the
main concept is as follows. Whatever percentage of the total company
payroll a person takes on a yearly basis, they should be eligible for the
same percentage of the profit sharing bonus. If an individual makes
$25,000 per year, and the company annual payroll is $500,000 that person
receives five per cent of the annual payroll. So that person’s five per
cent of the $30,000 profit would result in a $1,500 bonus.
What this will do is keep your entire staff focused on helping you reach
your profit goals. It also will discipline you into keeping an accurate and
timely financial picture of your business. This one addition to your
business can have a very positive influence.
It is a real fun event when you reach your goals and celebrate the victory.
If there is one thing that is missing in most retail stores, it is
celebration for a job well done. I have too often seen an attitude of staff
being little more than an extension of a cash register and just lucky to
have a job. Take a look at the sports teams and the mega dollars they make
and still, when they win a championship, they celebrate and enjoy the
moment. If you want staff to work beyond “just a job” attitude, put an
effort into creative ways to recognize and acknowledge your staff when they
perform beyond “just the job”.
In today’s competitive market, where 80 per cent of healthcare decisions
are being made by women who base their long term buying decisions on
relationships and trust you can not afford to have inconsistency in the
people serving your customers. Remember, how you treat your staff will
directly relate to how they treat your customers.