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How to Reduce Retail Labor Costs Without Downsizing

If you’re in retail and labor costs have you considering downsizing to save some money, it’s easy to feel disheartened. With the current labor shortage going on and retention becoming more difficult, downsizing may feel like the only answer, but the good news is that there are steps you can take to reduce retail labor costs without downsizing, and you may even be able to capitalize on your retail marketing strategy in the process.

Before you start downsizing to reduce retail labor costs, consider the following:

Rely on Cross-Training Opportunities

Instead of downsizing, consider cross-training to reduce labor costs. Employees who can serve customers in multiple departments allow your store to operate more efficiently, and you can better utilize some employees in roles you had not considered previously. This provides employees with the chance to gain more experience, and it allows your store to accomplish more with fewer resources.

It can also benefit your store’s efforts to deliver an engaging customer experience. When your staff feels accomplished, employees tend to promote word of mouth marketing messages. Customers who have a great experience in your store because of positive interactions with happy employees can go on to spread WOM marketing to their friends and family on social media and in real-world conversations.

Look to Automated Solutions

Retail automation can also reduce labor costs by improving efficiency. For example, when you automate things like trend analyses for CPG brands in your store or take advantage of a retail marketing solution like Demo Wizard to manage scheduling for store sampling experiences, your labor is freed up to focus on other tasks.

At the same time, your store receives the benefit of vendor field marketing and a better understanding of what motivates customers to spend more in your store when you turn to automation. Using automation doesn’t mean that your employees become less valuable – in fact, quite the opposite. When you turn to automation solutions, your employees become even more valuable since labor resources can be utilized for more critical tasks that automation can’t handle.

Analyze Communication Between Departments

Interdepartmental communication reduces labor costs because inefficient communication between departments can lead to wasted time. When departments don’t have a clear communication strategy, department heads cannot keep up with what is happening around your store. This means that more labor is spent shuffling between departments to get answers that could have been obtained in seconds with a clear communication strategy.

Additionally, trouble with interdepartmental communication can lead to products being sent to the wrong departments or customers being directed to the wrong service areas. These are just a few examples of issues that must then be resolved, once again leading to wasted productivity. However, with a clear communication strategy between departments, you recapture this productivity and avoid wasted labor.


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