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The holidays are quickly approaching, which means retailers of all sizes are preparing for their busiest time of year. Despite a year of economic uncertainty, 34% of consumers say they plan on spending more this holiday season than the previous year, according to the Square 2023 Festive Forecast report. In order to meet customer demand and capitalize on sales, it’s critical to have the right staffing in place for your business’s in-person shopping and back-of-house fulfillment needs.
When considering job offers, retail employees are not only concerned with base pay, but overtime and other benefits such as health care, flexible hours, and bonuses. Savvy retailers have the opportunity to attract top talent with creative job offers while keeping their fixed costs down.
Get a sense of your staffing needs
Strategically staffing during the peak busy season will give your business a competitive advantage. Start by reviewing your historical sales and inventory data in order to forecast customer demand. In addition to understanding your item and order data, analyze whether you overstocked or understocked certain items, which resulted in lost sales or future discounting to increase the sell-through on slower-moving products. Reviewing historical in-store versus online order volume will also help inform your in-store staffing needs to service customers.
Next, take a look at your business’s operational performance over the last few years. Did you meet your outbound service level agreements (SLAs) in order to meet customer expectations and reach your internal operating goals? If not, was it due to labor shortages or inefficiencies within your fulfillment process? Marketing and operations teams should align around a single sales and operating plan that accounts for upcoming promotions and seasonality. For example, if you plan on running a Black Friday or Cyber Monday sale, ensure you have enough hands on deck to fulfill the influx of orders within your standard SLA time. Ensuring your business is staffed correctly helps avoid disappointing customers with order delays.
Using Square for Retail analytics, you can easily review the previous year’s sales and inventory data and performance insights to inform a seasonal hiring plan to capitalize on expected demand.
Understanding pay expectations
Once you have an idea of your business’ staffing needs, it’s time to do your market research to develop competitive job offers. Creating a compelling job offer starts with understanding what competitive pay looks like for similar retail positions in your geographical area.
Employers can leverage the Square Payroll Index to keep track of pay in their area on a base wage and average hourly earnings basis. Square calculates average hourly earnings as the sum of regular wages, overtime wages, double-time wages, and tips divided by the sum of hours an employee worked in a given pay period.
Square Payroll Index data shows that at the end of September 2023, average retail hourly earnings rose to $16.31 and retail base wages grew to $15.80.
While base pay is important, it doesn’t tell the whole story. In order to attract talent during the busy season, job offers need to include competitive overtime as well. Square Payroll Index data shows that at the end of September 2023, average retail hourly earnings rose to $16.31 and retail base wages grew to $15.80. Growth in average hourly earnings has outpaced base wage growth by several percentage points every month since at least 2018. These findings indicate that competitive pay includes a strong base wage in addition to pay on the basis of average hourly earnings after accounting for overtime. Seasoned retail employees know to look for overtime wages, particularly during the competitive holiday season.
Making a competitive offer
Outside of pay, there are other ways retailers can get creative and attract both seasonal and long-term employees. Many retail workers are looking to join a company that aligns with their own values and offers benefits, growth opportunities, and flexibility. According to LinkedIn’s 2023 Workplace Learning Report, employees care deeply about career growth and learning opportunities. Furthermore, employee development programs are inexpensive and increase retention. Offering employees opportunities to grow within your company can be an effective way to attract talent without increasing base pay for incoming employees. Finally, providing health care options to employees that meet the hourly minimum and other perks, such as employee discounts, are effective ways to sweeten the deal outside of pay.
If prospective employees have questions about the base pay or the average hourly earnings you’re offering, it can be helpful to reference the retail averages in your area to demonstrate transparency and give them confidence to accept your job offer.
Technology to streamline onboarding
Time-constraint employers can leverage technology to make hiring new employees quick and intuitive. Using Square Team Management, it’s easy to onboard employees and manage your team, all from your Retail Point of Sale. Company information can be sensitive, particularly with part-time or seasonal-only employees. Square Staffing allows you to customize the permission settings that you create and assign, so your team will have the right access to be able to contribute more confidently. Plus, when you use Team Plus and Square Shifts Plus together, you can track each team member’s time, sales, and activity through the reports and the Activity Log. Employees can access methods configured through Team Plus for time tracking and for clocking in and out at the point of sale.
In the competitive market retailers are facing today, appropriately staffing to meet customer demand during the busy season is paramount to maximizing revenue opportunities. The good news is that retailers can attract top talent without unrealistically increasing base pay or even overtime wages by understanding the employees’ priorities and leveraging payroll market data.