Retail Observer

May 2021

The Retail Observer is an industry leading magazine for INDEPENDENT RETAILERS in Major Appliances, Consumer Electronics and Home Furnishings

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RETAILOBSERVER.COM MAY 2021 50 I f you ask leaders in any retail industry (including rent-to-own) what keeps them up at night, they'll probably say the inventory challenges that the COVID-19 pandemic has brought. And a close second on the list might be retaining great employees. According to Wikipedia, "Employee retention refers to the ability of an organization to retain its employees. Employee retention can be represented by a simple statistic (for example, a retention rate of 80% usually indicates that an organization kept 80% of its employees in each period). However, many consider employee retention as relating to the efforts by which employers attempt to retain the employees in their workforce. In this sense, retention becomes the strategies rather than the outcome." We may all want to say that our target is zero employee turnover, but that will be difficult, if not impossible to achieve in any business model. But what is the industry standard for the rent-to-own community? For comparison, turnover in the hotel industry varies from 60 to 300% (Source: CHA International). Grocery is typically 100% (Source: Small Business Chronicle), while retail is typically 59% (Source: Small Business Chronicle). As reported recently by CNBC, fast-food companies are losing 100% (and in some cases more) of their employees each year. Interestingly, according to the 2021 Bureau of Labor Statics report, the overall annual total separations rate, or turnover rate, in 2020 was 57.3%, and in my experience the rent-to- own industry is right in the middle at between 50-60%. I have always defined my key strategies for retaining employees in the RTO industry to be: • Start new hires the right way. • Compensate competitively. • Find new ways to challenge your employees. • Set clear expectations for each position. • And then ask for feedback with an employee satisfaction survey to get as much insight as possible into what motivates your employees. The one piece I would like to add to this strategy is employee praise! Think about an old boss you did not necessarily like – how would you rate their skill at recognizing, praising and rewarding hard work and achievements? Now take an honest assessment of your skills at delivering praise today – are you truly providing timely recognition for great performances, large and small? Delivering effective employee recognition is mostly an art, not a science, and the key takeaways for me are: • You must be timely – The more time that passes between a great performance and the recognition, the less impact you'll have. Immediate is never too soon. • Specific praise is most impactful – Do not simply tell an employee they did a good job – tell them how they did a good job. This lets them know you're truly paying attention. • Don't mix your messages – One thing I was guilty of as a leader was praising along with constructive feedback. Unfortunately, your employees will only hear what they need to do better. Save the performance improvement conversation for later. As a rent-to-own industry leader, your challenge is to create a recognition culture. That means that you need to spend time trying to catch employees doing good things and provide sincere feedback. Be unexpected! Tenure recognition is great, but an employee saving a great customer, and you recognizing it, is awesome! My last employee recognition tip is old-school: do not underestimate the impact of a handwritten note. This long-forgotten style of gratitude and thanks for a job well done is very powerful. I know that brick-and-mortar rent-to-own is and always has been a high-relationship loyalty-business transaction with the existing customer base, but you cannot forget about your employees who drive the customer loyalty. Praise and recognition are essential to success and have never been as important as they are today! Keven Dalke, Director, Nationwide RentDirect EMPLOYEE RETENTION CHALLENGES FOR RENT-TO-OWN IN TODAY'S ENVIRONMENT RO Keven Dalke Rent-to-Own Trends

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