Grappling with shop-floor employee exits, retail chains are setting up schools to train them in selling goods, besides ensuring a better work culture with higher pay and promotions.
?Front-end jobs are majorly affected because of the nature of duty,? says Ajit Joshi, chief executive officer, Tata\’s Infiniti Retail, which runs electronics chain Croma. “A shop-floor employee has to work even on public holidays, during which we see maximum footfalls.”
Roughly 40-50 out of 100 shop floor employees ? who have a direct connect with the customer ? exit retail chains annually. The industry, which clocks $28 billion, employs 2 million people.
Employees leave for three reasons: one, absence of a good salary structure; two, lack of good working conditions for entry-level employees; and third, dearth of quality retail education, which deters them from taking up retail as a serious career option.
?Retail companies should improve service conditions and grant more decision-making powers to employees at the shop floor,? says Arvind Singhal, chairman, retail consultancy firm, Technopak Advisors. ?Attrition at the shop floor is much higher than at the managerial level. Since there is no upward growth curve for entry-level employees, they are willing to switch jobs if offered R200 more,” he added.
But retail chains are now making efforts to curb this trend as consumer expenditures rise. Croma offers intensive in-house training for new employees as, according to Joshi, the cost of replacing an employee is high. ?A lot of time and energy is invested in training an entry-level employee.”
Employee salaries in organised retail are also expected to rise anywhere between 15-30% by 2020, against unorganised shops, said a joint study by Confederation of Indian Industry (CII) and the Boston Consulting Group (BCG).
Consumption in August grew 3.7% from the same month last year, data released by India Central Statistical Organisation show. The organised retail industry in India is estimated to grow to $170 billion by 2020, creating any where between 3-4 million direct and 4-6 million indirect jobs, says the study. “Attrition in front-end jobs is 30-32% for us,? says Nihar Ranjan Ghosh, executive director, human resources, retail, RP?Sanjiv Goenka Group. ?It?s better than the industry average, but isn\’t comforting, as we have to create a new team almost every three years.?
RP?Sanjiv Goenka Group, which owns Spencer\’s Retail, employs 5,500 people and trains 50-60% of its new recruits under their Internal Retail Management Trainee Program. “We train freshers to enhance their productivity and help them become store managers within five years,” says Ghosh. Aditya Birla Retail, which owns \’More\’ stores, employs around 9,000 staff and has an attrition level of 6-7% every month. It needs to hire 5,400 employees for replenishment every year, as it expands to more towns. ?It is very difficult to curb attrition in entry-level jobs,? says Thomas Varghese, chief executive officer, AB retail.
Croma is trying to improve its shop-floor employees\’ working conditions by providing dining and changing rooms, and facility to iron clothes. ?We\’re working at the ground level and looking after the overall well-being of our employees,? says Infiniti Retail\’s Joshi.
Consultants say retail courses could help create better talent. ?The government needs to create recognised courses and industry-wide accreditation for basic training of entry-level employees,? says Abheek Singhi, partner and director of consulting firm BCG. ?Even retailers need to make collective investments towards developing training facilities.?
Most retail companies fail to train freshers. ?I don\’t blame them,? says Singhal of Technopak. ?When employee retention is only 30-40%, how much can a company invest in training??
But there are some signs of change in retail training. ?Skilled manpower is important, but employees should feel pride and respect for their profession,? says BS Nagesh, founder of Trust for Retailers and Retail Associates of India (TRRAIN), a non-profit firm that trains retail staff.