Understanding Retail People Counting Trends through Labor Allocation
When was the last time you walked into the store, found exactly what you were looking for, went to the checkout line only to find a long line of other customers in front of you? Did you wait in line or did you put down your planned purchase and leave?
What about the last time you went to a store to buy an item that you were not familiar with. Was there a store associate ready and able to assist you?
Retail trends will show you that customer service will affect what and how much you buy as a shopper. In fact, in this age of increased competition, providing a consistent in-store experience to your customers is key. So the natural next question is how does a retailer provide consistent guest experience across varied traffic times?
STAR is a ratio of customers to store personnel calculated by dividing people counter traffic by sales floor labor hours. Calculating and understanding STAR provides consistent measurements to which identify current and optimal service levels in your locations. This is important because retail trends will show a direct correlation between STAR and Conversion (the number of people that buy). In other words, the better a store is able to staff to traffic demands, the better a store can be at converting shoppers to buyers and driving sales performance.
To identify your optimal STAR, chart a minimum 6 week average of traffic counts and conversion performance by day of week. Identify a day in which conversion peaks and take note of the STAR. This should be your STAR target across all hours, days, and weeks to optimize customer experience and drive sales. Retail trends will show a positive conversion performance when STAR targets are reached and maintained.
As simple as this may sound, we realize there are a few pitfalls to avoid:
- Minimum staffing – Don’t choose a STAR target that is extremely low and cannot be sustained. Identify the highest STAR ratio at which conversion peaks and use that STAR ratio as the target.
- Reallocation is Key – Some STAR targets can be obtained within your existing labor budgets. Identify where you can move 4 hours shifts across the week to better align with traffic.
- Quality of Labor – Having a warm body on the floor to meet the STAR target is not going to drive sales; scheduled associate should be well trained and knowledgeable. In fact, you will see that you can actually increase your STAR (schedule less labor) and still meet your conversion and sales targets with more diversified and well trained staff.
- Manager Coverage – Believe it or not, staff will perform better when the manager is on duty. Scheduling the store manager during the peak traffic times throughout the week will positively impact performance (including weekends and evenings).
- Required Change - Believe it or not, small changes to your staffing schedule can make big differences. Starting a shift as little as 15 minutes earlier can allow a staff member to complete all pre-shift requirements and to be on the sales floor when a peak traffic time starts.