INDUSTRY SNAPSHOTS Retail - Purchasing power · 9 Deloitte. com, 2016 Retail Industry Outlook.102016 Aflac WorkForces Report. Citations About Purchasing Power We help employees who

1

INDUSTRY SNAPSHOTS

Retail

2

Overcoming HR Challenges in the Retail Industry

Many retailers are coping with regulatory changes and retention challenges by

cutting hours and reducing the time and cost of new hire training. But they still need

employees with strong sales and customer service skills who see retail as a viable

long-term career. Recruiting, retaining and engaging those employees require low-

or no-cost benefits that can support both their personal and professional goals.

3

1. New technology

Consumers “must have” the newest Apple product or other new innovative mobile,

wearable and portable products each time they are released, and they are not

likely to spend on technology and apparel at the same time. Retailers must be able

to attract customers even during a new technology product launch.

2. Millennial customers

Millennials are “real-time” consumers, shopping for today’s needs and waiting

until the last minute to shop for tomorrow’s events. Because they are afraid of a

recession or lack of employment, they want to own less and lease more.

3. Content curation

Providing a personalized and relevant experience for each customer through

one-to-one marketing requires more content and curation. Most retailers are

investing in content management systems and mining consumer insights to help

understand the story consumers want to hear.2

Industry ChallengesInternet sales are booming at the cost of direct store purchases, and customers are favoring off-price stores that offer fashion at an attractive price. Many retailers are finding that they must restructure if they want to survive. Some of the other top challenges1 include:

4

HR Challenges

1. Employee retention

With average voluntary turnover at 29 percent,3 retailers are constantly challenged

with finding innovative ways to recruit and retain qualified employees.

2. The cost of turnover

Replacing one employee costs, on average, over $5,700.4 Per 1,000 employees, the

average retailer loses more than $1.6 million per year due to turnover.5

3. Employee productivity

With 37 percent of all employees saying they are distracted by financial stress while

at work,6 the average retail company is losing more than $724,000 every year per

1,000 employees7.

Among the challenges HR professionals in the retail industry face are:

of employees are distracted by financial stress while at work6

37%37%

(per 1,000 employees7)$724,000

(per 1,000 employees5)$1.6 million

average cost to replace one employee4

$5,700

5

Trends

1. Cyber security

Cyber security will continue to cut across all aspects of the business:

disruption, convergence of digital online, social, new ecosystems, and

mining customer insights.

2. Retailers will continue to upgrade technology

Cloud computing is central to modernization and a key issue since

retailers often lag behind other industries in embracing cloud

technology. There is also now much more rapid consumer adoption

of mobile payment technologies driven in part by competing payment

platform introductions.

3. Enhanced benefits packages

In the current marketplace, employees have more flexibility to seek

out employment opportunities that better fit their needs and wants

rather than remain in a position for its job security. However, 41 percent

of employees say improving their benefits package is one thing their

employer could do to keep them in their jobs.10 Employers may look

at enhancing benefits packages with flexible work hours, expanded

benefits, more vacation or medical leave options.

As voluntary benefits have become more mainstream, they play an

important role in enhancing benefits packages to satisfy employees’

needs. Employers are increasingly embracing non-traditional voluntary

benefits as a method of providing enhanced benefits packages.

Purchasing Power’s employee purchase program is one of the

non-traditional voluntary benefits that supports key HR objectives

by providing a no-cost, no-liability benefit that gives employees a

manageable, convenient way to access products and services that are

often out of reach.

An ongoing focus for retailers is to omnichannel. Bringing online and offline together is important in every facet of a retail business.8 Other trends include:9

6

1Forbes.com, “Every Sign is Saying Retailers Must Restructure,” Walter Loeb, Jan. 2016. 2Deloitte.com, 2016 Retail Industry Outlook. 3 US Bureau of

Labor Services Job Openings and Labor Turnover Survey. 4 CBSNews.com, “How Much Does It Cost Companies to Lose Employees,” Suzanne Lucas,

Nov. 2012. 5 US Bureau of Labor Statistics Employer Costs for Employee Compensation. 6 Harris Poll conducted on behalf of Purchasing Power,

2015. 7 US Bureau of Labor Statistics Employer Costs for Employee Compensation. 8 VendHQ.com, Retail Trends and Predictions, 2016. 9 Deloitte.

com, 2016 Retail Industry Outlook.102016 Aflac WorkForces Report.

Citations

About Purchasing PowerWe help employees who are underserved by traditional financing options access life-enhancing products and services. Employees can purchase the items

they need and affordably spread payments across 12 months to give them peace of mind and control over their finances. Our pricing is transparent with no

hidden fees, no interest, no credit checks.

Why We Do It

• To improve employee financial well-being

• To empower people to take control of their lives

• To help organizations recruit and retain employees

Visit us at PurchasingPower.com/Employers.

“Purchasing Power” is a registered trademark of Purchasing Power, LLC. Other trademarks or registered trademarks used are the property of their respective owners.

Pub. Date 02.2017 © 2017 Purchasing Power, LLC. All rights reserved | * Definitive 2016 customer survey responses