All across Canada, minimum wages have been going up. Ontario and Alberta both increased their minimum wages last year. BC did too, and more increases are slated in the Pacific Province.
These increases can have small business owners in retail wringing their hands. While you might agree employees deserve fair wages, an increased wage has to come from somewhere. Most often, that money comes out of your bottom line.
This scenario can reduce your profitability. In some cases, business owners may even need to take on debt to fund increased costs. Higher labour costs can have drastic impacts for retailers like you.
These three tips can help you survive the increases in minimum wage.
1. Look to Improve Workforce Productivity
One of the best things any retailer can do in the face of minimum wage increases is to look for ways to increase the productivity of their current workforce.
As your business grows, you may believe you need to hire more employees to manage increased demand. This leads to increased labour costs. The truth is, however, most of your employees could likely be more efficient. This leads to higher productivity, which means you need fewer people on staff.
There are many ways to improve workforce productivity. Employee engagement is a huge factor. The more engaged your employees are, the more productive they’re likely to be.
Another factor is how you use technology in the business. Using the right cash management technology can reduce the amount of time your employees spend handling cash, for example. This allows them to accomplish more in less time. It also frees them up to take on revenue-generating tasks.
2. Schedule More Effectively
Another way technology could help you is by improving how you schedule your employees. You may find you’re constantly sending people home because you have too many employees on staff. Other days, you may find yourself short-staffed. You may end up asking staff members to stay late, which could lead to overtime.
Technology can help you schedule more effectively. There are programs designed to help you crunch the numbers and get the right number of people on the floor at the right times. This reduces overtime and time paid to employees who were sent home early.
Cash management technology can help here too. Coin and bank note recyclers, for example, can eliminate the need for employees to spend time counting tills and preparing floats, which means you don’t need to create overlapping shifts. At first glance, saving 15 minutes may not look like much, but over the course of a year, it adds up.
3. Lower Turnover and Reduce Hiring
Did you know high turnover costs businesses billions of dollars every year? The cost of replacing an employee is often estimated at their annual salary, but it can actually be even higher. Once you factor in hiring costs, along with training and development, turnover could be costing you more than you think.
Look for ways to lower your turnover. Retaining employees is more cost effective than hiring new ones. One easy way to reduce turnover is to take steps to increase employee satisfaction. New technology that makes the job easier could be one part of a strategy designed to improve employee satisfaction.
With reduced turnover, you may not need to hire as often. If your employee retention efforts also include better scheduling and a focus on increasing engagement, you can also bank on higher productivity.
Cash Management Technology Is Crucial in Taming Labour Costs
Cash management technology may seem like an added expense, but it’s actually a crucial component of reducing your labour costs in retail. With better cash management, you can also accomplish goals like improving employee engagement and productivity.
As minimum wages continue to rise across Canada, adopting cash management technology is smarter than ever.