A UK retailer with 100,000 employees could save E90-100m a year if it halved employee turnover.
According to a study by the Coca-Cola Retailing Research Group Europe, unveiled this week at the ECR Europe Conference in Berlin, the typical replacement cost of a store manager is E32,000 in the UK and Germany while a checkout operator costs E2,000 to replace.
"European retailers experience 30% annual employee turnover rates," said Tesco marketing director Tim Mason. "We need to focus attention on the critical processes of attracting, recruiting, training and retaining people."
The research, entitled A Leadership People Strategy for Food Retailers, shows that 65% of younger people are concerned about work/life balance while issues such as flexible hours and career breaks are identified by working mothers.
"European food retailers are not generally adopting best practice in human resource strategy and process," said Mason. "While food retailing is one of the largest private industries, there is still an underlying image problem."
A key recommendation from the study is that assessing attitude is more important than skills when recruiting customer-facing staff. The single most important factor when it comes to motivation is to concentrate on communicating success stories.
According to Knut Faremo, executive vice-president of NorgesGruppen, it was essential this issue should be put at the top of the corporate agenda.
"We spend a huge amount of money understanding customers and what they want, but very little on understanding employees.
"We now have consumer relationship management. In the future we may have employee relationship management. Improving this will impact on the bottom line."
The Coca-Cola study involved 660 top performing employees from France, Poland and Germany and 15 HR directors from retailers across Europe, including the UK.
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