Dirty Bathrooms and Messy Stores Still Hurting Retail

Retail Store

Can cleanliness and organization affect how a retail store performs? You better believe it. 2018 was a rough year for several retailers…proving that fact.

Toys R Us closed for good in the United States and was forced to liquidate because it was unable to sustain its debt load after a leveraged buyout in 2005. According to a filing with the bankruptcy court, Toys R Us had still been making $400 million payments on its debt every year.

Department stores, in particular, have been struggling because of declining foot traffic to malls, which has affected Sears, JCPenney, Lord & Taylor, and Macy’s. They all have closed stores in the past year, and Sears filed for Chapter 11 bankruptcy protection after years of declining sales.

The rise of e-commerce has played a huge role in the downfall of some retailers who can’t keep up with Amazon, eBay, Wayfair, etc. Although stores have been working on improving their marketing strategies, it hasn’t always been enough. Even on Black Friday, traditionally one of the biggest shopping days of the year, stores were relatively empty.

Maybe it’s because department stores are focusing on the big picture and not the details. During secret shopper visits to various stores, it was alarming what was discovered. Empty shelves, dirty carpet, displays so crowded you couldn’t sort through the inventory, and empty cash registers with no employees in sight.

Tom Buiocchi, the CEO of facilities management platform ServiceChannel, sees it over and over. Retailers cut back on store maintenance and improvements and end up on the fast track to bankruptcy, while those who invest in store improvements and upkeep are succeeding and expanding.

A study commissioned by ServiceChannel surveyed 1,521 consumers and 70% said they recently had a negative experience with a messy store, ranging from dirty bathrooms and broken toilets, to disorganized shelves and burned-out light bulbs. Over two-thirds said they have walked out of stores because they were messy or disorganized. Four out of five shoppers said they would rather have a clean store than ones with the newest tech, and two-thirds said retailers are forgetting the basics—like clean floors and well-stocked shelves—in the rush to add tech. “The vast majority of purchases are still being done by people walking into a location. And their experience of that location has never been more important,” Buiocchi said in an interview.

With so many other shopping options, retailers must be on top of their game. Consumers want to be rewarded when they make the effort to walk into a store and a dirty, disorganized store says the retailer doesn’t care—about the store or the shopper. Store maintenance used to be considered “a non-sexy part of the business,” Buiocchi said, “but now it directly affects the high expectation for an in-store experience. And facilities managers all have a role at the table now.”

Many of the new online brands that are opening stores are quick to recognize the value of rigorous maintenance and are signing up as customers. “There are the people that get it, and there are the people that don’t get it,” Buiocchi said. “Good progressive retail is investing in their brick-and-mortar experiences and enjoying the benefits of that,” he said. “Bad retail is not and they’re unfortunately being penalized for that.”

Although JCPenney has been struggling the past few years, new CEO Jill Soltau, is up for the task of bringing the stores back to life. Soltau, who took over the position in October, said in a recent earnings call that the department-store chain is failing to adequately deliver on some fundamentals of “good retail.”

On Tuesday, JCPenney reported first-quarter earnings for 2019; same-store sales during the quarter dropped by 5.5%, following a 6% drop in the previous quarter. “I am pleased with the strides we’ve made in setting key objectives, building our senior leadership team, executing significant changes in our assortment, such as eliminating major appliances, and mobilizing the entire organization around our priorities,” Soltau said in a press release on Tuesday. She continued: “JCPenney is an American retail icon that is very important to all of our stakeholders, and I am encouraged by the early signs I am seeing in our business as we work to realize the potential that lies ahead.”JCPenney, and other struggling retailers, are definitely capable of delivering on the fundamentals of great retail. The fate of the company now depends on its ability to execute this shopping experience across its entire fleet.

The problem is consistency. Visits to numerous JCPenney stores across the Southeast proved just that. Stores in Richmond, Virginia featured empty shelves, messy displays, and abandoned cash registers. The stores, which both anchored enclosed shopping malls, felt outdated and far too large. However, a third JCPenney store in a strip mall, revealed flawless design, layout, and presentation. This store obviously cared about presentation, reputation, and customer experience.

Customers Still Want the In-Person Customer Experience How to Capitalize on it

How can you make the customer experience better? It’s pretty simple actually…talk to your customers.

While the digital experience is important due to the rise of social media shopping and interaction, new research has found that putting extra effort into the personal touch – phone or face-to-face contact – is more successful at making the customer experience memorable and increasing sales.

Almost two-thirds of customers say they spend or invest more in products and services after they’ve had personal contact with someone at the company, according to research from BookingBug. And 50% said that being able to speak with a service or sales professional when issues arise is critical in making the decision. Plain and simple, when customers talk to someone, rather than corresponding through email or social media, they are likely to become a loyal fan.

It’s important to build both a competent digital experience and a feel-good personal experience. “By closely following customers along their dynamic journey between digital and physical worlds, businesses will engage more effectively, build trust with customers and ultimately drive increased revenue,” says Glenn Shoosmith, CEO of BookingBug.

How can you bridge the digital and personal experience?

Make your people accessible – online and on the retail floor. Customers still want to gather as much information as possible on their own…from your website, on social media, and by reading online reviews. But eventually, many of them will want to talk to or meet with a service or sales professional. Make that as easy as possible by adding the ability to schedule an appointment to every page on your website and on your social pages. And know your busiest shopping times so you have ample sales staff available. There’s nothing more frustrating than walking around a store hunting for an associate to answer your questions.

Customer service

Know their experiences. When customers get in touch with you, the service or sales professional should have an idea of what the customer has already experienced. Businesses can use tracking software to better understand what customers are interested in and the processes they have already gone through to handle their issue. Once they’ve asked to talk or meet, review what’s already been done, ask what questions they have, and move forward with information targeted at the needs they’ve shared.

Be prepared. The most important aspect of a personal customer experience is knowledge. Customers routinely give top ratings to experiences when the person they work with can answer everything they need answered – or, at least, know where to find answers and respond with them quickly. You can do this by providing ongoing training for all staff members so they stay on top of developments on your products, services, uses, technology and industry.

Managers also have the responsibility of understanding and managing workloads across all teams. Knowledge of their team’s attendance and performance trends, including nonproductive hours and overtime, can empower retail managers to become more successful in responding to workforce challenges, addressing individual employee needs, and building stronger customer relationships.

Keep in touch the right way. Just because customers have a personal interaction doesn’t mean they want to continue communicating that way. Make sure you ask how a customer wants to continue to receive information, handle follow-up or be contacted in the future. You’ll likely want to keep in touch with customers after calls or visits, but you’ll want to do that on their terms.

Great customer experiences lead to loyal fans and repeat business. In order to achieve this, brands need to invest in educating employees and making sure all members of the team are focused on positive customer interactions – whether that is digitally or in-person. Take care of your team and they will take care of you and your brand.

How Loss Prevention Audits Help Retail

Loss Prevention

The loss prevention audit is a means of providing an objective and consistent evaluation of company standards, operating procedures and internal controls. Audits enable companies to address a variety of performance efficiencies that shape and influence service, sales, organization, security, productivity and numerous other factors that impact overall management and profitability of your store or facility.

Analyzing the results of a loss prevention audit can provide you with a multitude of insights in to the overall operations of a store. Compliance—and non-compliance—does more than provide you with specific information regarding how a specific strategy is being executed. The audit process will also provide insights about the bigger picture:

  • The leadership in the store and the way they supervise their teams.
  • Organizational skills and the overall way store operations are managed.
  • Management’s ability to plan, prioritize and multi-task.
  • The character of store management and how they perceive the importance of certain aspects of their job.
  • The sense of ownership that store management carries in making and keeping their store successful.

Auditing is a process, and should not be viewed as a single event that occurs in the store on any given day. Results should be reviewed and analyzed over time. Anyone and any store can show great results or great lapses in efficiency at any given time…but it’s how those results are received, how they are addressed moving forward, and how they are managed over time that will provide you with true insights.

It is vital that you approach audit functions with the appropriate understanding of your role in order to most effectively serve the company, the store, your associates and your customers. The spirit of the entire audit process should be one of growth and progress.

There will be challenges and opportunities, including:

  • This is what we found…
  • This is why it’s an issue…
  • Here is how it should be corrected…
  • Establish an action plan that facilitates correction and improvement…
  • Establish a timeline to follow up on the areas of opportunity…

The purpose is to reinforce principles that should already be familiar to those being audited and evaluate compliance with established performance standards. Too often, audits tend to focus on the negative. This unfortunate tendency can and will influence the entire process, and must be addressed in order to make the impression and realize the results that we hope to accomplish. Our methods and mentality should acknowledge achievements while recognizing the importance of training, education, and awareness as a means to send a message and improve our stores.

Driving Performance with Loss Prevention Audits

loss prevention audit should do more than evaluate performance. A well-managed program should also serve as a training tool that enhances performance through training and development. Compliance is a result of information effectively learned so that it can be applied, and behavior effectively inspired so that it will be modified and maintained. Ensuring that policies are correctly followed must be an emphasis of the audit process.

Tracking Results

There are many ways to input and track audits results. Some companies use paper audits and manually track the results. Some companies use software programs and handheld devices that enable them to instantly view, sort, and track results. However you do it, make sure that the results you track include the total audit scores, as well as the responses to each individual question.

The ability to quickly view the results of the inventory shrink audits should be a major consideration. Audit scores are important, but so are the common findings. For example, knowing that 95% of your stores failed questions 25 and 26 on the audit will enable you to determine why they are failing those questions and identify what needs to be done to get them back into compliance. Common findings should be reported on a regular basis so you can course correct throughout the time period leading up to your inventory analysis.

Communicating Results

Timely reporting of audits is important. As soon as an audit is completed, the results should be communicated to the store and the district manager. This enables them to take immediate action to correct identified issues. The sooner they can be addressed, the sooner they can be corrected.

Audits can serve as an important vehicle for ensuring operational compliance, enhancing awareness, measuring key performance functions, and providing valuable teaching and training opportunities. But our impact on the business is only as successful as our methods, our approaches and our attitudes when conducting the audit, when sharing the results, and when supporting the store teams. Information must be used in a positive and productive way. Our objective must be to improve the performance and productivity of our stores, and add value to the organization as a whole.

Loss prevention audits can be a tremendous tool in helping to validate performance and bring attention to store strengths and deficiencies, but it is how that information is used that will add value to the organization. We have to maintain a positive, objective approach when evaluating compliance. We should recognize exceptional performance when it exists.

We should not only identify opportunities for improvement, but educate the store on the reasons why it’s an issue, how it can potentially impact the store, and how we can make improvements.