Half Of Retail Employee Hours Scheduled When No Sales Are Made

Retail Employee

Running a business that has 50 percent inefficiency baked into the single-largest cost center — labor — would likely be unacceptable for most companies. And yet, for many of the nation’s retailers, that untenable scenario is not an academic case study or a doomsday scenario — it’s their day-to-day reality.

“The challenges we were facing was that everybody was looking at different data,” Devin Shrake, founder and chief product officer of Shiftlab, told PYMNTS. “No one knew if managers were creating a good schedule or a bad schedule, because you’d have sales data over here and a scheduling tool that looks like a Google Calendar over here.”

On average, companies onboarded by Shiftlab in 2020 had over 50 percent of employees’ hours scheduled when no sales were made. To remedy this, Shrake said, Shiftlab’s software monitors employee availability, historical sales data and individual performance to ensure that associates are on the floor during peak periods — and not heading out the door or taking a break right when it gets busy.

To be sure, part of the labor shortage is caused by a wage shortage — if job seekers are the sellers of labor and employers are the buyers in the job market, companies must find the price at which jobseekers are willing to sell. But even when adequately staffed, Shrake said retailers are using outdated systems that can cause associates to be in the right place at the wrong time.

“There are a lot of things that come into scheduling when you want to be strategic about it,” Shrake said.

Growing Ambitions

Shiftlab primarily works with wireless retailers, such as Verizon, AT&T and T-Mobile, which is the industry Shrake worked in until founding Shiftlab in 2019. The company also works with cannabis merchants and electronics repair shops such as Zagg, which operate similarly to wireless retailers.

Shrake said Shiftlab will eventually move into working with call centers, where employees may be working remotely and aren’t necessarily assigned to a location, but that would be a vertical jump for the company and will require more planning.

Last week, Shiftlab was acquired by retail management software company iQmetrix, which Shrake said will allow Shiftlab to accelerate its growth and get direct exposure with more retailers. The two companies have been partners since early 2020, with iQmetrix providing data for Shiftlab’s scheduling software. Shiftlab will continue to operate as a separate company, but the backing of iQmetrix may allow Shiftlab to begin synchronizing data in real time or to embed its software into point-of-sale systems, which will allow the company to reach more stores.

“As a lean organization, you need all the sales help you can get, and you need all the marketing help and expertise you can get,” Shrake said.

Recruiting a Workforce

Of course, optimizing work schedules requires employees, something retailers are struggling to find despite myriad initiatives. Walmart, for example, has said it will pay for employees’ college tuition and books through its Live Better U program, and CVS earlier this month announced that it will increase hourly pay to $15 after recently eliminating the high school diploma or GED requirement for most of its entry-level roles

Still, increased pay and better benefits may not be enough to get job seekers in the door. A survey of over 400 7-Eleven franchise owners conducted by the National Coalition of Associations of 7-Eleven Franchisees found that chronic understaffing issues persist even as they raise wages.

See more: 7-Eleven Franchisee Labor Woes Suggest Wages Are Not Enough To Woo Workers

Ultimately, for stores to meet their staffing needs, changes may need to be made to more than just wages. A survey of 16,000 workers in 16 countries conducted by EY Global earlier this year found that more than half of employees want flexibility in when they work, 40 percent want flexibility in where they work, and millennials are twice as likely as baby boomers to leave their jobs if they are dissatisfied.