Retail Management – Meaning, Importance, and More
Effective retail management ensures that customers can find what they are looking for in a physical store. Customers can then quickly make the right purchasing decision by comparing similar items with features and prices, or get a product demonstration from the well-trained staff. Learn what is retail management today.
Running a store means making the in-store customer experience great, bringing more returning loyal customers and increasing the bottom line. But managing a physical store is becoming more complex in today’s eCommerce and technological boom.
That’s why store owners or brands with physical stores need to give importance to retail management with the right retail managers.
What is Retail Management?
Retail management refers to running daily operational and administrative activities in a retail outlet. All these activities are required to improve the customer experience, right from when they arrive at the store to their purchase.
You can say that retail management aims to increase sales and traffic at the store, through which both customers and employees are satisfied.
And a retail manager’s responsibility is much broader than it is perceived. They have to coach and train the retail staff regarding communication skills with customers and acquire product knowledge. Keeping track of store inventory, sourcing the right suppliers, monitoring expenses of maintaining the store, preventing thefts, etc., are among the other activities.
Related: Inventory Management
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Importance of Retail Management
See why retail management is becoming so important after the pandemic.
Growth of Experiential Retail
Retail management is an essential part of running an omnichannel business nowadays. Since the pandemic, eCommerce has led businesses to choose omnichannel strategies.
But, in the case of retail stores, customers expect a more experiential flavour. According to Shopify, 40% of brands are going to make experiential retail a top priority in 2023.
Trends such as Artificial Intelligence and augmented reality (AR) in retail are growing everywhere. AI can help in demand forecasting and help improve customer service, while AR can easily introduce an immersive shopping experience.
Expectation of In-store Shopping Just Like an eCommerce Store
Customer experience is a highly complex factor to consider when it comes to in-store experiences as compared to eCommerce website shopping. Today, customers expect that the layout of products at the store, product categorisation, etc., to be as convenient as using a website to buy products is. If the experience is great, the customer is likely to purchase more.
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To Keep Updated Inventory Using the Latest Technology
A physical store has to keep its inventory updated at all times. If proper systems are not used, customer experience will suffer. Nowadays, stores have POS (point-of-sale) inventory systems that warn when stock levels go down.
Likewise, retail managers need to train new staff to use such systems. Through the adoption of such technologies, the processes can save time while keeping both customers and employees happy.
Also, read more about What is Supply Chain Management?
Responsibilities of Retail Managers
Here are the main roles and responsibilities of retail managers listed under two broad categories.
Staff Duties – Training
One of the main responsibilities of a retail manager is to train their staff. They must be able to hire skilled personnel who are willing to adopt new systems in their workflow. They must also be required to acquire product knowledge which can help in-store customers make the right decisions.
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If they do not have much experience in sales, you will have to teach them. But primarily, you have to ensure that they are able to communicate well with customers.
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As a retail manager, you will be responsible for creating their daily schedule, resolve conflicts, and make sure they follow safety and other policies. You can reward them when they follow procedures and give them constructive feedback in areas of improvement.
Store Duties – Administrative
It is important that the products available at the store are easy to find for customers. Proper categorisation of products, monitoring inventory and sales, updating financial records, etc. are the day-to-day activities of a retail manager.
You would have to keep track of sales records and compare with the targets set. If they are not met, you have to devise a plan that helps you meet those targets.
Keep in mind that you would have to monitor a variety of retail metrics, ranging from sales per employee, sales per foot, conversion rate, Y-o-Y growth, etc.
Apart from that, keeping track of items is essential, as inventory shrinkage is a common issue in retail stores. This happens through shoplifting and employee thefts. This shrinkage is also a result of return fraud or a vendor fraud.
Top Skills You Will Need as a Retail Manager in 2023
As a retail manager, you would need to have the following skills.
Leadership and Managerial Abilities
As it is upon the retail manager to train staff, it is necessary to take the right action to meet sales targets.
Part of your staff training is to guide them on how to be effective in their jobs. This can be achieved when they are motivated enough. Soft skills such as leadership are fundamental.
On the managerial side of things, you would need to have to maintain a healthy workplace environment. You would have to manage conflicts, manage staff performance, provide feedback, and help the store grow by reducing high attrition rates. According to McKinsey & Company, the annual attrition rate for frontline retail workers is 60%.
Customer Service Skill Set
According to a survey from Salesforce, “89% of consumers are more likely to make another purchase after a positive customer service experience.”
As it is a physical store where a retail manager operates, good customer service is likely to encourage word-of-mouth marketing for the store.
People are willing to pay more, given that good customer service is part of a brand store.
Showing empathy to frustrated customers, good listening skills, store offerings, maintaining resilience, etc., are essential qualities that are expected in customer service.
Analytical Thinking Ability
As a retail manager, it is essential to keep an eye on performance and targets. But it is equally important to use analytical thinking by automating mundane tasks like sales targets per employee per day. These calculations can be easily performed on an Excel spreadsheet, which is a big time saver.
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Product Knowledge
One aspect that differentiates good retail managers and stores from the rest is product knowledge of the staff. A lot of stores the customer goes to, do not have the right staff who can explain the product properly. Instead, they will give the customer the basic rundown of features which the customer may have already researched online.
Having good product knowledge means that you are able to explain how the product is able to solve a unique pain point of the customer in regard to the product. Here, knowledge of the industry, how the brand markets the products, etc., are essential.
Parting Thoughts
So now you know what retail management is, and its importance. If you are inspired enough to get into this role, obtain some retail management certifications right away!
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