As a consumer-facing industry, controversies such as zero-hours contracts are damaging to the retail sector’s reputation.
Retail is a high-profile, consumer-facing industry. For the media and public alike what happens at Tesco or Marks & Spencer is of more consequence and interest than even more dramatic news in other industries.
Retail entrepreneurs such as Sir Philip Green and Sir Stuart Rose have become celebrities in the same way as David Beckham or Sir Elton John.
When I was working in the City as a retail analyst I found myself in regular demand to contribute to news programmes whereas my colleagues covering pharmaceuticals, engineering etc never enjoyed that kind of exposure.
Therefore it is no surprise that our industry receives the most complaints, since it is the industry that everyone has the most frequent regular contact with in everyday life.
It is worrying when, in the aftermath of horse meat revelations or accounting irregularities, retailers become in danger of credibility ratings which rival those of politicians or bankers.
The analogy with politicians is apt – retailers must win ‘votes’ from the public and attempt to deliver what they promise through their products and service.
In this context I am astounded that there are a number of retailers that have seemingly been prepared to run the risk of not paying some of their employees the statutory minimum wage.
This is banking-style short-termism. It is much more than a legal matter, it is about respect and common sense.
Retailers may feel they cannot afford to pay higher labour costs but the reality is that they cannot afford not to.
Forget David Cameron’s cheesy electioneering (“it is time to give Britain a pay rise”). Regardless of the outcome of the election, increasing inequality is already accepted as one of the top global economic issues and will be an issue which can no longer be ignored in the future.
Boris Johnson, for example, has embraced the ‘living wage’, a campaign in which retail is notable for its absence.
At a time when consumer expectations are inexorably increasing and online is taking a bigger and bigger bite out of the total retail spend, the UK’s 3 million retail employees seem increasingly neglected and peripheral.
The functions of a shop are evolving and the successful store of the future will empower its staff to provide stock and product data through mobile PoS devices, electronic shelf-edge labelling etc and the kind of personal service which cannot be replicated online.
The store of the future will need fewer staff to handle the lower levels of customer traffic but better quality, motivated and incentivised staff to act as enthusiastic and dedicated ambassadors for the brand.
At the end of the day you get what you pay for and if you pay peanuts you will get chimps.
In politics we appear to have a valid choice when we vote but the subsequent delivery invariably disappoints. In retail there is a real opportunity to make a difference in delivery, to be a John Lewis or Nordstrom.
The route to this successful outcome in terms of brand loyalty and a reputation for service seems unlikely to be best served by paying your staff as little as you can get away with or the adoption of zero-hours contracts.
- John Richards, independent retail consultant and non-executive director