Profitability Thru
Structure
Creating Policies and Procedures
When it comes to merchandising
and advertising, most independent retailers will go to great lengths
to distinguish themselves from the mass merchants. In an informal
poll taken at the Shot Show in Las Vegas in January, retailers
agreed that there were a number of items that they should stock,
that could also be found in the mass merchant. This was due to
the overwhelming popularity of the items among consumers.
Yet,
these same retailers made a point to shop for manufacturers that
either did not sell to the mass merchants, or through some manufacturers,
the retailers stock a more upscale line of products. This effective
strategy of duplicating some of the products of the mass merchant,
and then taking a different tact with others, can effectively
be applied to other areas of your business.
In this, and future
editions of Retailer's Notebook, we are going to examine management
tools that we would undoubtedly find with a mass merchant, but
perhaps not find in many of the independent merchants. Again,
this is a situation where we need to duplicate the mass merchant,
but be able to adapt the situation to better serve employees and
customers.
Job descriptions, job specifications,
store policies, and store procedures, can all become valuable weapons
for your business. If you agree with the expression that you aren't
going to shoot your limit without the right weapon, perhaps you
will appreciate knowing these "weapons" will assist you in
getting the maximum from your business.
Development of these weapons
to their fullest potential will be easier, and involve the least
amount of time if you are holding staff meetings at least every
other week. Even if there is only yourself and a couple of part
time employees working in your business, regularly held staff
meetings are a sure way to increase profits, and to get the maximum
efforts from your employees.
These staff meetings provide
you with the occasion to gather all of your staff to discuss problems,
advertising, opportunities, as well as the setting in which to
develop these weapons. With many retailers, these meetings will
begin as a series of gripe sessions. But, after the first few meetings,
and by inviting everyone to participate, you will find that you
are developing new solutions to old problems.
You will begin to
find that your meetings, which should be no longer than one hour
in length, will now have time available to discuss better methods
of taking care of your customers. As you enjoy these positive experiences,
you can begin to develop the four weapons.
Policies and procedures
are the logical next steps in achieving your goal of profitability
through structure. With this issue of Retailer's Notebook, we will
discuss policies which can be defined as the rules of your business.
Policies usually detail situations such as your dress code, personal
usage of the telephone, and the holidays that your business is closed
to observe. Again you think, "I
have a small store, and no time to write these things down."
This
is all the more reason to create a policy manual. As independent
business owners and managers, there are tremendous demands made
upon your time and efforts. By creating a policy, you give direction
and consistency to yourself and your staff. Especially in a small
business, where friendships tend to develop between employer and employee,
there is a need to have written policies to avoid personality conflicts.
And if your business has ever
been the subject of an unemployment claim which you believe was
unjustified, policies can go a long way towards receiving a favorable
judgment.
Creating policies should be
a slow and gradual procedure. From our personal experiences, we
found that even after seven years we were still creating, deleting,
and changing our store policies. The overall idea is to foresee
the potential of a conflict, misunderstanding, opportunity to increase
profits, or cut expenses, and then by working with your employees,
create a written policy to address the situation.
An example that
most retailers can identify with is the matter of requesting days
off, vacations, and calling in sick. After experimenting with several
solutions, our policy on this matter evolved to create a list of
each employee's phone number. Along with this list was our written
policy which stated how vacations were earned, how to put in a request
for vacation time and when they could be taken. An explanation was
also given that flexibility was necessary for everyone to assist
in covering a schedule when one employee was on vacation.
The matter
of requesting days off and calling in sick were the more difficult
matters to resolve. Again, our solution was to state that the owner/manager
would assist an employee to find someone to cover a work shift if
notice of at least 24 hours was given. However, with less than 24
hours notice, the absent employee was required to find their own
replacement. The final point was to explain a person calling and
leaving a message of, "Tell the boss
I am sick and won't be in today", could be subject to termination.
Does the policy sound tough?
Yes, and it was tough to initially administer. But after the first
couple of situations of needing to speak with an employee about
their absence, our problems of working understaffed were being resolved.