What Is Retail Management? (With Benefits and Tips)
By Indeed Editorial Team
Published 29 November 2021
The Indeed Editorial Team comprises a diverse and talented team of writers, researchers and subject matter experts equipped with Indeed's data and insights to deliver useful tips to help guide your career journey.
The retail industry can be competitive and dynamic. Adopting a strategic approach to retail business management can benefit customers and the company. Knowing what retail management is can help streamline business operations, improve employee productivity and deliver a memorable shopping experience to customers. In this article, we define retail management, discuss its benefits and processes and list the management positions available in the retail sector with average salaries.
What is retail management?
Understanding 'what is retail management?' is important when considering working in the field. Retail management is a combination of day-to-day activities, techniques and practices that enable a store to sell goods or services to customers. As with any business, the goal of retail management is profitable growth. The retail management process seeks to attract buyers to the store and enhance the retail shopping experience to create customer satisfaction by implementing the following:
Related: What Is a Visual Merchandiser?
Benefits of retail management
Retail management is essential to the success of any business because it can improve growth and profits. Below are some benefits of strategic retail management:
Optimising internal processes
Whether you want to improve store layout or manage inventory better, retail management can help you transform store operations. You can allocate team members properly and ensure suppliers get prompt payments. Effective retail managers can also deploy core systems that work seamlessly and know stock levels, so you can quickly fulfil orders.
Adopting a proper retail management strategy can help bring the retail team together and ensure they agree. Teams can collaborate and support each other better as they follow standard operating procedures. Another thing, team members may also understand their roles and their contributions to the bigger picture. Cohesion can foster a sense of community and increase overall productivity.
Improving customer satisfaction
On the customer side, retail management can ensure loyal customers receive value for money in the store. You can use an attractive store layout and design to attract customers, then drive engagement with strategic product placement and timely customer support. Customers may be happier when they know the business and employees are more proactive to their needs.
Enhancing customer experience
Besides meeting customer needs, retail management goes further to enhance customer-brand interaction and experience. To deepen relationships, it is important to communicate and engage customers. You can also use promotions and entertainment experiences to attract and keep customers. By creating a great experience, you can help the business stand out.
Promoting business growth
Having efficient internal processes, excellent products or services and enjoyable in-store experiences can lead to growth. You may find that operational costs are decreasing and this may increase your profit margin. As the customer base grows, recurring revenues may also increase. A strong reputation may also make it easy to attract more customers in the future.
What is the retail management process?
The retail management process is the system you follow to facilitate business operations. It usually cuts across functions such as business administration, marketing and finance. Below is a typical retail management process:
1. Internal planning
A variety of tasks happen before a retail store starts operations. Your efforts and strategies at this phase can make the customer-facing side of business stand out. When planning, you can consider the following factors:
Hiring: Recruit and train enough employees so they can serve customers and deliver the best customer experience possible.
Market research: Understand how the retail industry works, know your competitors and what opportunities exist for the business.
Logistics: It's crucial to know how to move goods or merchandise from the wholesale supplier to the retail store, including transportation options and costs.
Finances: You can find out how much it costs to run a store. Factor expenses like wages and bills and what is the profit margin on retail sales.
Compliance: Address all legal and financial matters before you market or sell products. You can perform safety inspections, get compliance audits and get quality certification and address consumer privacy issues.
Once you complete the planning, it is time to find the right product supplier. You can consider the purchase price for the products, with discounts, quality of services and the supplier's payment or credit policy. The goal is to find a reputable supplier who can deliver high-quality and affordable products now and in the future. It's important to ensure that you have sufficient capital to make first bulk orders and ample warehouse space.
3. Order fulfilment
The purpose of operating a retail store is to fulfil the orders of target customers. It goes beyond moving products from one point to another on the retail floor. To ensure proper fulfilment, you can develop a procedure for receiving and assessing products from suppliers. You may identify products to ship, confirm the order quantity and specifications and check the condition of the products. On the customer-facing side, you can arrange products for easy access and retrieval, document and track product location and store goods in good conditions. If all these are in place, you may have a simple time delivering products to customers.
4. Promotion and sales
Next, you can run promotions to make customers aware of the products/services and their value. Retail collaboration, pop-up shops and special in-store events are all practical ways to attract customers and drive sales. You can also curate the best stocks and make use of any opportunities to cross-sell or up-sell to increase customer retention.
5. Sales, service and support
Talented salespeople and customer service employees help customers make quick purchases. Retail employees can help shoppers navigate the store, suggest a product that solves a particular need. They may also provide additional information about products, such as specifications and prices.
Types of retail management jobs
The retail sector usually has various management roles. Each position may involve overseeing different aspects of a retail business. Here are common retail management job descriptions:
1. Head cashier
National average salary: $48,347 per year
Primary duties: A head cashier supervises other cashiers, maintains the cash register and trains new hires. The head cashier may also perform customer service duties. These include answering questions, resolving complaints and reconciling the cash drawers.
National average salary: $58,674 per year
Primary duties: A store manager handles daily operations in the retail store. They oversee the hiring and training of employees, manage inventory, implement store promotions and monitor customer returns. They also act as a resource for team members and customers on store policies and other store information.
National average salary: $70,975 per year
Primary duties: As a retail inventory professional, a warehouse manager may have several responsibilities. Their duties include reporting inventory trends, monitoring inventory levels, managing the warehouse and employees. They may also create enticing displays to encourage additional sales.
National average salary: $73,925 per year
Primary duties: A customer service manager handles aspects of customer support. Their role is to provide resources to solve customer problems. These may address customer concerns, communicate customer issues to store management and research unresolved issues.
National average salary: $131,071 per year
Primary duties: A general manager hires and interviews employees. They also evaluate employee performance, administer disciplinary action and set the store's goals. The general manager works with the store-level manager to develop procedures to increase the store's profitability.
Retail management tips
Operating a retail store with multiple vendors and customer expectations can be a delicate balancing act. It is important to ensure the retail store performs its functions and serves its customers right. Below are tips that may help you meet customer expectations, keep team members happy and potentially meet revenue goals:
Communicate clearly. It's important to listen to both employees and customers. Communicating your expectations and tasks can ensure employees do their work the right way.
Embrace modern technology. Adopt retail management tools to reduce paperwork and streamline operations. The best software can help you manage employee schedules, analyse daily sales and track your goals.
Organise the store. Ensure the displays, shelves and backroom areas are neat. Keeping the store organised makes it easy for customers to locate products.
Know your customers. Understand your regular buyers, especially their pain points and what products can meet their specific needs.
Be compliant. Ensure all merchandising is up-to-date and in compliance with in-store policies and external standards.
Delegate tasks. Empower retail store associates by sharing information that allows them to make high-level decisions. Delegating tasks and decision-making helps employees develop a sense of ownership for the store's well-being.
Lead by example. Wear your retail associate hat and show that you can tackle simple store duties. Team members might try to emulate the quality of your work and match your effort.
Build a great team. Every store manager is as good as the team they leader. Recruit and hire candidates with relevant job experience and desirable personality traits.
Salary figures reflect data listed on Indeed Salaries at time of writing. Salaries may vary depending on the hiring organisation and a candidate's experience, academic background and location.
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