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Increase Efficiency to Reduce Retail Labor Costs

While retailers struggle to maintain their profit margins, labor costs continue to rise. Check out these smart ways to keep them under control.

Fine-tune schedules.

This can be tricky in retail; there may be too many employees on the job when customer traffic is low, or not enough when the store is jammed. Analyze your POS sales data to more accurately schedule the right number of employees for each shift. (Or obtain scheduling software that will do it for you.)

Avoid overtime.

Instead of having your full-time employee work extra shifts at the time and a half, pay a part-time or temporary worker the base rate to cover the same hours.

Eliminate time theft.

A time and attendance app will ensure that employees are not being paid for the time they didn’t actually work: coming in late, leaving early, long breaks, rounding up hours or buddy clocking in/out.

Cross-train employees.

Most people are happy to learn new skills and take on new roles. And you’ll be happy that fewer people are needed to get the work done. Plus, if one employee quits, you’ll have another ready to step in without the costs of a new hire.

Reduce employee turnover.

Recruiting and hiring new employees is expensive; it’s much more cost-effective to keep the ones you have. That doesn’t mean you have to give them raises; the number one reason people leave a job is happiness, not money. Provide opportunities for engagement and career advancement to keep them on board.

Increase employee productivity.

Another benefit of keeping employees happy is that it also keeps them more productive and efficient — up to 20% more, according to some studies. That means you could get the same work out of fewer people.

Re-evaluate wages and pay structures.

  • Check whether your pay rates are consistent with industry norms at PayScale or Glassdoor. If they’re too high, bring them in line for new hires.
  • Convert sales roles to a commission-only pay structure.
  • Give pay raises based on performance, rather than an automatic annual increase.

The best way to reduce labor costs isn’t to reduce staff. It’s to increase efficiency in managing the human resources you already have. That’s how you have your cake and eat it too: keep customer satisfaction while taking a giant step toward improving profit margins.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

Social Proof: A Must-Have in Service Business Marketing

Testimonials from satisfied clients, positive reviews on Yelp, numbers data, professional association logos — these are all that marketing experts call social proof, and they are an excellent way to gain the trust of prospective clients. While they are successful in many industry sectors, they’re especially so for retail service businesses which rely heavily on reputation and word-of-mouth.

Here are a few tips for making social proof work for you.

Use effective testimonials.

A couple of sentences saying that everything was great aren’t very interesting — or convincing. Choose ones that:

  • Mention a specific benefit the client received. “I looked so good at the class reunion that my old crush never took his eyes off me.”
  • Answer a question or potential objection. “They really captured the spirit of my wedding with their candid photography. Worth every penny!”
  • Include keywords that people would put into Google when looking for businesses like yours.
  • Include the name and photo of the person commenting — much more credible than a stand-alone quote.

Monitor the review sites.

They are a great source of testimonials. Even more important, you need to stay current with what people are saying about your business — good and bad — so you can nip any problems in the bud.

Present numbers/data proof compellingly.

Unless yours is a volume- or speed-driven business, people won’t much care that you “served over 15,000 clients last year.” However, they will be intrigued to learn that “25 clients are getting a buff body right now.” This combines a benefit with the number, showing how your success empowers the client’s success.

Display professional recognitions.

The social proofs mentioned above all come from the client’s peers. This type of proof comes from a respected authority. You could use:

  • Logos of professional associations you belong to
  • Awards you’ve received
  • Media coverage you’ve received
  • Better Business Bureau logo

Social proofs in advertising and marketing are not just effective, they’re cost-effective. Many of them are even free. That’s great news for any business with a finite marketing budget. And what we’ve discussed here is just the tip of the iceberg. In future articles, we’ll cover how to obtain social proofs, how and where to use them, and how to measure their success in attracting new clients to your business.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

The Happiness Factor in Reducing Employee Turnover

Surprise: the biggest reason people quit isn’t the money (it’s not even in the top 5). What sends them out the door is unhappiness with the working conditions. That’s good news for your payroll budget, but you may have other issues to address if you want to retain valuable personnel. So what do employees list high on their happiness scale?

Relationships with superiors and co-workers.

  • Promote a corporate culture of mutual respect and support.
  • Praise employees when they do well at least as often as you point out mistakes.
  • Create a comprehensive, clear employee manual so everyone knows what’s expected.
  • Take employees’ comments and needs seriously.
  • Treat everyone the same, even relatives.

Job activities and opportunities.

Employees are happiest when they are interested in what they are doing, feel that they are stakeholders in the company’s success, and are given new challenges from which they can grow professionally and personally.

  • Hold regular meetings in which everyone has a voice.
  • Set goals for career growth.
  • Offer cross-training.
  • Establish achievement reward programs, such as sales competitions.
  • Get involved as a group with the community or charitable events.

Work/life balance.

Putting in so much overtime that there’s nothing left for friends, family or fun causes stress and burnout, leading to mistakes and poor productivity. This factor is especially important for employees from the millennial generation.

Work environment.

The physical workspace can greatly help or hinder productivity. This includes:

  • Comfort, cleanliness, health, and safety
  • Efficient and effective tools and equipment
  • Clear paths, workflows, and processes

Employer’s image.

Being proud of where they work is a powerful motivator for employee happiness and loyalty. This means:

  • A good reputation within the industry.
  • Corporate values of quality, honesty and fairness towards the community, customers, and workers.
  • Financial stability.

All these happiness factors come before the compensation package when employees are deciding whether to stay or go. Some attention to interpersonal relationships, management style, and employee recognition may be all it takes to turn dissatisfied workers into enthusiastic, hard-working ones.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

6 Ways to Cut Overhead Costs

Every business has to spend money in order to make money. Here’s how to keep those ongoing expenses from getting too high and impacting your bottom line.

Take a fresh look at every single expense.

Chances are, some of them have become a habit but can now be either eliminated or achieved in a more cost-effective way.

Re-negotiate supplier and vendor contracts.

  • There may be things in there you don’t need anymore.
  • On the other hand, you may find that buying more services from one company costs less than piecemealing it out to several suppliers.
  • Ask for a better deal from existing suppliers.
  • Shop around for more favorably priced suppliers.

Allocate more marketing efforts to free or low-cost channels.

  • Word-of-mouth and tell-a-friend promotions to existing clients.
  • Social media campaigns.
  • Strategic partnerships with other local businesses.
  • Employee sales competitions.
  • Testimonials from satisfied clients.

Centralize purchasing.

One person in the company should handle it all, from office supplies to phone/internet providers to equipment rentals. This person will:

  • Prevent duplications, unexpected shortages, and confusion.
  • Be good at wangling better deals, concessions, and discounts.
  • Shop around for the best offers.

Re-think your office space.

  • Do you really need to be leasing so much space?
  • Do you have too much inventory/equipment on hand, taking up storage space?
  • Is there another space available that offers equally good access for current and prospective clients at a lower rate?

Control labor costs.

  • Avoid paying overtime by fine-tuning scheduling or converting to part-time employees.
  • Reduce turnover and hiring expenses by maintaining a happy, fulfilling work environment.
  • Cross-train employees to fill more than one role.
  • Prevent time theft with an app that tracks actual hours worked.

Solving the overhead problem is all about baby steps. Chip off a bit here, a bit there, and keep a year-round watch on expenses. It will all add up to some nice, healthy profit margins.

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.

 

Insuring Your Future: A Tax-Saving Retirement Guide for Insurance Professionals

You spend day after day helping your clients protect their assets from the unexpected. Take a moment today to think about protecting yourself from the 100% expected: your retirement.

As a self-employed insurance pro or business owner, you may not have the luxury of en employer-matched 401K built into your benefits package. That means it’s up to you, and you alone, to prepare for the future.

There are actually four retirement plans for self-employed workers that can help reduce your taxable income while saving for retirement.

Solo 401(k)

If you have no employees other than a spouse, this type of plan is great because of its high contribution limit (up to $59,000 if you’re over 50) and because taxes are paid on withdrawals. Accounts with $250K or more do require an annual report with the IRS, but they are relatively easy to set up initially.

Simplified Employee Pension (SEP IRA)

These easy-to-set-up plans work well for self-employed workers with few or no employees. SEP IRA’s are also ideal if you’re looking to match contributions to profits, allowing you to contribute as much as $53,000 annually. Just keep in mind that if you do have employees, you can’t contribute a higher percentage to your own account than theirs.

Savings Incentive Match Plan for Employees (SIMPLE IRA)

The SIMPLE IRA plan makes sense if you have a small business with a lot of employees. While matching contributions are deductible for you, and most employees don’t contribute, there is the possibility of mandatory matching contributions.  SIMPLE IRAs have moderate contribution limits and require little setup or maintenance.

Defined Benefit Plan

This type of plan works well for solo self-employed workers with high, stable incomes and a desire to put a lot of money away for retirement. Contributions to this plan can be as high as $100K/year depending on your age, and all of those contributions are tax-free until you withdraw. The downside is that Defined Benefit Plans require you to commit to a certain funding level when you set them up — and if you have employees, you must make contributions on their behalf.

No matter which plans you decide to go with, the key is to start now, while time is on your side!

 

This post is intended to be used for informational purposes only and does not constitute as legal, business, or tax advice. Please consult your attorney, business advisor, or tax advisor with respect to matters referenced in our content. Xendoo assumes no liability for any actions taken in reliance upon the information contained herein.