Article:

Retailers: here's how you need to change

09 May 2019

Ragtrader |
Mark Schiavello , National Leader, Retail
Partner, Corporate Finance
|

BDO's Mark Schiavello explores the importance of diversity in retail support staff and how this can increase your profits

Retailers are facing unique challenges. In a world of digital disruption, engaging with customers looks different than it did in the past, but human interaction in the sales process remains king. If the people your customers interact with don’t meet or even exceed their expectations, they are easily able to end those interactions—and take their business elsewhere.

Clearly people matter in the retail industry. But what does a successful workforce look like, and how can retailers build one? The key metric is workforce diversity. Retailers with a diverse set of employees perform better than their less diverse competitors. In Australia about 25% of our population are non-Caucasian yet the majority of retail propositions are highly skewed towards this audience. 

Studies in the United States have found that a greater representation of ethnic minorities predicted greater store success. In certain parts of the United States it was found that the stores with greater racial and ethnic diversity saw gross margin profits 89% higher than stores that were less diverse.

Having a greater balance of generations in the workforce

We hear so much about the importance of having a diverse workforce that we often forget what we’re really driving toward. A diverse workforce can better understand the requirements of an increasingly diverse customer base, ensuring that the products and services your company delivers are the right ones to meet your customers’ needs. In retail, your employees are interacting with customers face to face, providing a visible indication of the kinds of people your company values. Having a sales force that resembles the market you are selling to communicates to your customers that they can expect to speak to someone who looks, thinks, and considers options in much the same way they do—a key to driving sales, and driving profitability in the years to come.

Support staff humanise brand experience through empathy and tailored advice. Retailers should empower diverse support staff to explain, suggest, share brand and product enthusiasm.

Impactful support staff are crucial in retail as 68% of shoppers expect store associates to be experts on the products offered on the sales floor, and 75% of consumers say it’s absolutely critical or very important to interact with a salesperson who is available when they need them. 

Even with a diverse workforce you’ll never be aware of all the cultural differences. That’s ok. Knowing that there are differences, however, and recognising the logic from cultures will help you to deliver an exceptional customer experience

What’s more, these cultural differences can take place within one society. Melbourne, for example, is host to a plethora of cultures. Then there are lots of variations and mixes between the dimensions above, and globalisation makes things even more complex.

So instead of assuming a certain cultural programming when dealing with a customer from a different culture, start with an open attitude and be perceptive of the differences you’ve read about here, and adjust your behavior when you see fit.

Contact Mark Schiavello and learn more about how BDO can help your retail business.