HCM pain points for Retail organisations — and tech solutions to remedy them

A snapshot of the Retail industry 

Few frontline industries have changed as drastically as Retail has in recent years. 

If somebody told you 10 years ago that your Instagram page could be turned into a retail storefront, you probably wouldn't have believed it. Transition to 2024, where 20% of retail sales were made online and retail ecommerce sales surpassed USD 6 trillion, and it seems that outlandish prediction has turned into reality.  

Fortunately, not all is lost for traditional brick-and-mortar retailers. Physical retail is still highly valued by consumers for the tactile experience and authenticity it provides; in fact, trends show that online and offline retail continue to converge as a sort of hybrid preference.  

The pandemic may have accelerated the shift to ecommerce, but online spending has seemed to plateau since. Consumers have overcome the burdens of that time — and businesses, once again, seek to deliver a personalised, premium, flagship experience in-store.  

Introduction to HCM challenges faced by Retailers 

For Retailers, HCM challenges arise primarily due to fluctuating economic conditions, labour shortages, high levels of staff turnover, and challenges maintaining employee wellbeing. 

Inflation has had adverse impacts on both Retailers and consumers globally. Since 2020, consumer prices in the US, for example, have risen 22% (as of August 2024), leading 74% of Americans to claim that they are “very concerned” about the price of food and consumer goods. Given this cost-of-living increase, Retail positions simply don’t offer a healthy enough wage for workers to survive on. Currently, there are over 5.5 million job openings across the US, largely exacerbated by ‘The Great Resignation’ of 2021 which saw 721,000 retail workers walk away from their jobs.  

Consumer behaviour directly influences Retail staffing patterns. Staffing and labour demand are often correlated to peaks and troughs in consumer spending, resulting in a highly seasonal workforce. While inflation continues to subdue consumer spending in Australia, peak periods like Black Friday and the holiday season consistently encourage healthier spending. Fluctuations like this cause perpetual forecasting and rostering & scheduling headaches for Retail managers and HR teams. 

Retailers are also no stranger to high employee turnover. This study found that 70% of retail workers are open to leaving their job for higher pay, amongst other factors. Turnover isn’t just costly — it’s a gateway to, and indicator of, other snowballing HCM issues.  

In addition to high turnover, employee disengagement is commonplace in the industry. In the UK, for example, it’s estimated to cost Retailers £628 million, annually. Absenteeism is also rampant, along with high instances of poor mental health; this 2023 survey found that 78% of retail workers in Australia experienced stress, anxiety, or depression, with 49% being physically or verbally harassed while working.  

Retailers are evidently no strangers to HCM issues. In an industry where employee and customer are inextricably linked, the success of these businesses boils down to how premium of a customer experience (CX) they can deliver. The best way to do so is by prioritising the employee experience (EX) with the aid of innovative HCM technology. 

Pain point #1: Economic pressures and workforce scheduling complexity (the need to do more with less) 

The shift towards online Retail has resulted in the industry becoming hypercompetitive. 

Retailers operating in this space struggle to compete against multinational corporations like Amazon, and their gargantuan-level economies of scale. Innovation is now a priority, where marketing strategies, product ranges, and overall branding need to bring something unique and enticing to the table. Brick-and-mortar retailers operate at the mercy of consumer spending and demand, dictated by inflation and cost-of-living pressures. The trend here? It costs a lot of money to stay competitive — and labour costs are one of the biggest expenses for Retail businesses.  

For Retailers, labour demand is dictated by the peaks and troughs in consumer spending and consequently, accurate labour forecasting becomes a major priority. Efficient forecasting and scheduling means rostering the right number of staff to match customer foot traffic. 

How Humanforce can help managers do more with less 

Rostering & Scheduling 

The Rostering & Scheduling solution allows Retail managers to auto-generate optimised, demand-driven, award-compliant rosters in just a few clicks. These rosters will use historical data drawn from point of sale (POS) systems, to cite just one example, to match rosters according to demand peaks. 

Additionally, Retailers can split staff across multiple locations while being notified of shift conflicts while keeping an accurate record of total hours worked, thereby reducing inaccuracies and reduce unnecessary labour expenditure. 

Employees also stand to benefit from features such as the ability to bid on available shifts or swap shifts – all while using the Humanforce Work App. This provides greater flexibility and autonomy – potentially helping workers to fit work more effectively around their life commitments.

Onboarding & Offboarding 

With a high proportion of casual employees constantly coming and going in Retail, it’s essential to simplify their arrival and departure.  

The Humanforce Onboarding & Offboarding solution facilitates this seamless transition. It enhances compliance and cost efficiency by automating many time and resource intensive tasks in the pre-boarding stage, such as employee information gathering (bank details, tax details, qualifications, etc.) and policy signoffs.  

Even better, the onboarding workflows can be customised for each new hire’s specific role, team, and location. This can be shortened to ensure that only the most crucial onboarding tasks are included. This is valuable if a casual worker is returning to a previous employer, meaning that every onboarding step may not be required.  At the end of tenure, offboarding workflows can also be customised to the needs of each role, the tenure of each employee, or their employment type (full-time, casual, contractor). 

Pain point #2: Labour costs 

The constant fluctuations in staffing requirements make managing labour costs a difficult affair. Retail managers must forecast the correct amounts of staff in accordance with peaks and troughs in consumer spending and demand.  

Inaccurate forecasting always proves costly for Retailers. Call in too little staff, and customer service quality declines and overtime might be required. Call in too many people, and the business risks overspending on labour costs.  

This is why having a tool to accurately track employee hours and performance is essential. 

How Humanforce can keep labour costs down 

Time & Attendance 

Humanforce's Time & Attendance solution enables the precise, real-time tracking of workforce data. Employees can use either the Humanforce Work app to clock on and off, or on-site kiosks with sophisticated facial recognition, finger vein scanning or QR code features.

Managers can view the exact amount of time worked, by employee and location. With this data, they can then set up auto-approval processes for timesheets, which can then seamlessly link to payroll — ensuring the business pays only what it needs to, on time, every time.  

Workforce Analytics 

Humanforce’s Workforce Analytics grants Retail managers access to robust analytics & reporting capabilities, which can transform data into actionable insights. The reporting features can be used out-of-the-box or customised according to your needs. 

It grants area managers the ability to effectively manage multiple stores or departments. They can view key task metrics such as timesheet authorisations and rosters published across multiple stores, as well as tardiness, shift acceptance rates, the amount of overtime and labour costs, and countless other key metrics, all through a single dashboard.  

Managers can also monitor the shift patterns of casual workers to check for any shift consistency, preventing any claims of permanent status arising.

Sales budgeting 

Retailers are always trying to ensure labour costs remain proportionate to sales. Humanforce allows you to import forecasted and actual sales figures from POS systems so wage cost percentage can be calculated. The results can then be factored into reports generated in Workforce Analytics. 

Pain point #3: Employee turnover 

For many, Retail work is a temporary job to pick up while studying or travelling. For others, it’s an opportunity to earn a second income on the weekend.  

Generally, Retail work is seen as temporary work due to low pay, inconsistent hours, high stress environments, and poor prospects for career progression. It’s unsurprising as to why Retail experiences one of the highest levels of turnover of any frontline industry.  

To work towards reducing turnover rates, prioritising the EX is pivotal — whether it be via the provision of monetary and non-monetary rewards, flexible work hours, or new avenues for career growth. 

How Humanforce can reduce employee turnover 

Employee Engagement 

The Humanforce Employee Engagement solution keeps managers and employees connected as the go-to function for surveys, feedback and reviews. Host check-ins, track happiness and wellbeing over the entire employee lifecycle, and align wider teams around goals for better collaboration. 

With high volumes of abuse being reported annually, Retail employees can experience burnout quickly. Understanding how they are tracking at work is essential to maintaining their mental health and preventing disengagement or turnover. 

Pain point #4: Attracting staff 

The Retail workforce is the second largest employing industry in Australia with 1,352,000 workers, as of 2024. However, the median earnings of $1,334 per week are lower than all other industries median earnings of $1,700. 

These statistics make sense due to one key reason: retail staff turnover is, and always has been, quite high. It’s a common entry level or part-time profession, and employees move on fairly quickly. In the US, the current retail staff turnover statistic sits at 60%.  

The current cost-of-living crisis has also caused many shift workers to take on multiple jobs to meet their financial obligations, with 22% of shift workers in Australia taking on at least two different jobs. This has made talent attraction and retention an even bigger challenge for Retailers, who must now prioritise flexibility above all.  

In the face of high turnover and transient employees, Retailers should aim to position themselves as employers of choice by highlighting their employee value proposition (EVP) in all recruitment initiatives, reduce the time to hire, and ensure they can hire people quickly and efficiently to meet peak demand.  

How Humanforce can ease skills shortages 

Talent Suite 

Given the ever-fluctuating demand for skilled staff in Retail, strengthening the employer brand and having access to a pool of qualified candidates that can be called up on-demand is invaluable. 

The Humanforce Talent Suite is an all-in-one talent acquisition platform that pools pre-qualified candidates, contractors, internal staff and alumni into a single Talent Community. Retail managers can analyse labour forecasts and tap into the power of volume-based hiring, with the ability to contact large groups of suitable staff depending on the job. 

Each member of the Talent Community is given a profile complete with qualifications, achievements, preferences and work history. This reduces the time to hire and is a modern solution to contingent hiring. 

The Talent suite can also help build and reinforce your employer brand to stand out from the pack. Business leaders and store managers can create a career site that showcases their organisation’s culture with standout job listings across brands and categories. The application process can also be enhanced with engaging visuals and content tailored to each role. 

Pain point #5: Compliance 

Retailers are faced with myriad people-related compliance obligations. 

The most important regulations to consider from an HCM perspective are foundational workplace rights (such as the National Employment Standards in Australia), workplace health & safety (WHS), and ensuring employees receive the correct pay and entitlements according to relevant employment awards/employment agreements. WHS laws require that businesses provide a safe workspace that protects the physical and psychological health of all employees. 

They must also acknowledge and comply with the complex industry awards and employment agreements under which their employees are protected. This is essential, as the award outlines pay rates, rest periods, leave entitlements, notice periods, redundancy entitlements and other foundational employment details. The General Retail Industry Award [MA000004] is the key point of reference for retailers across Australia.  

How Humanforce can help with compliance obligations

Awards & Compliance 

The Awards & Compliance solution allows Retailers to accurately interpret complex awards and enterprise agreements, track changes as they happen, and apply them with ease. 

The sophisticated award interpretation engine (sometimes referred to as a pay conditions engine) ensures that all modern awards and employment agreement pay obligations and entitlements are met, providing instant calculations to indicate exactly how much employees should be paid. The pay conditions engine quickly and accurately calculates wages, penalties, overtime and allowances in accordance with the relevant industrial instrument(s).   

Pain point #6: Employee burnout 

Retail employees are often at risk of experiencing burnout. Working long, irregular shifts on the feet is taxing on the mind and body. It becomes even worse when exposed to difficult customers or a toxic work environment — more definitively, we refer to these factors as types of ‘psychosocial hazards’.  

Alarmingly, accounts of verbal and physical assault against retail workers have spiked in recent years. In Australia, SafeWork NSW has even produced risk checklists for Retailers to help reduce and handle instances of workplace aggression. The fear of experiencing abuse is a key driver of stress, anxiety, and depression among retail employees. 

In addition, many Retail roles are low-pay, meaning that financial stress is common, especially during a cost-of-living crisis. 

The duty of care to protect the health and wellbeing of employees falls to Retail management. This may take the form of a zero-tolerance approach to bullying and harassment, wellbeing initiatives such as online courses covering healthy eating, gym membership discounts, and financial education. 

How Humanforce can improve employee wellbeing 

Benefits 

According to Gallup, the number one way to prevent employee burnout is by making wellbeing a part of your culture — this includes providing the tools to help employees practice wellness and live healthier lives overall. 

Humanforce Benefits is a financial wellbeing app designed to alleviate financial stress.* Its range of features provide financial education and tools to budget and save money, including early access to pay and cashback rewards for everyday purchases. 

*Currently only available to Australian Humanforce customers.  

Conclusion 

Retailers operate in a dynamic industry that has evolved and continues to evolve with technological and social advancements. Investing in a modern HCM platform is the key to ensuring Retailers have enough of the right people on the floor to deliver the best customer service possible. 

About Humanforce 

Humanforce is the best-in-one platform for frontline and flexible workforces, offering a truly employee centred, intelligent and compliant human capital management (HCM) suite – without compromise. Founded in 2002, Humanforce has a 2300+ customer base and over half a million users worldwide. Today, we have offices across Australia, New Zealand, the US, and the UK. 

Our vision is to make work easier and life better by focusing on the needs and fulfilment of frontline workers, and the efficiency and optimisation of businesses. 

To learn more about how Humanforce’s solution can help automate people processes in your business, please contact us.