As shoppers, we know the feeling of a positive shopping experience when helped by an engaged associate. According to Gallup (2023), companies with highly engaged employees provide an enhanced customer experience, increased customer retention, improved shopper satisfaction, stronger word-of-mouth and reduced churn, resulting in 23 percent higher profits.
Conversely, disengaged associates cost employers $8.8 trillion annually (Gallup, 2024), cost their respective organization 18 percent-34 percent of their salaries and suffer a 10 percent reduction in customer loyalty.
A recent National Grocers Association report states the average associate turnover to be 69 percent. It notes younger workers have a higher turnover rate (90 percent for Gen Z, 72 percent for Gen X and Millennials) than Baby Boomers (45 percent).
The Talent Retention Report 2024 by iHire states that pay is ranked sixth among reasons for leaving. It is preceded by toxic work environment, poor leadership, unhappiness with direct supervisor, “other” and poor work-life balance.
Ratio Institute estimates current costs to replace an employee to be more than $5,000 each. These costs are more than $80,000 annually for an average store. An increase of $1.5 million in sales is required to cover these costs that do not include lost institutional knowledge, having to train a new associate and the time for that associate to become sufficient.
A study by Deloitte found that more than 70 percent of younger workers say a company’s environmental practices influence their decision to stay long term. This marks an opportunity for grocers to engage associates.
There is no other business in our respective communities that can communicate and demonstrate the importance of effective resource management than the local grocery store.
Engaging employees in workplace practices leads to a positive work environment, improves operational energy efficiency, reduces food waste, conserves water and drives increased profitability and customer loyalty.
It is time to consider combining the employment opportunities that grocery stores represent with being community stewards and positive and engaging places to work.
Grocers should invite their associates to be part of the resource management process. This provides employees with contextual knowledge of store policies, practices and technology and helps them see how they impact the store strategy and profitability.
Understanding and ownership of best sustainability practices (oops, we said that word again) improves retention and recruitment.
Grocers don’t have to be experts in employee engagement strategies. Simple solutions such as naming champions for different aspects of the store can increase associate engagement and store performance.
Different associates can be named to monitor, provide feedback and give improvement ideas to reduce food waste, increase recycling, improve energy conservation and the like. These can be done by category, department or other.
These champions can report back to a resource captain (usually not part of store management) to collate, document and report areas and ways to improve store operations.
This simple process can empower associates to improve their work environment, give them more control of it and – with guidance and structure – align recommended practices with store strategy and goals.
Associates who are invested in a resource management process and have contextual knowledge of how their daily decision-making and behavior impacts the commitment to the community, the promise of the brand and overall store performance are more productive. They also are less likely to leave and are better positioned to exhibit and communicate the value of the store to shoppers and potential new employees.
A resource management process helps breed new and better store leadership and creates a positive work environment and culture of continuous store improvement.
Ratio Institute is an independent nonprofit organization dedicated to accelerating measurable sustainability and viability in food retail through expert collaboration, industry resources and practical tools. To learn more, visit RatioInstitute.org.