What’s your turnover rate?

Turnover can be very costly, yet it is often overlooked or poorly measured by many convenience store retailers. Studies peg the cost of replacing one c-store employee can be $1,500 or more and that ignores the opportunity cost from increased sales resulting from a well trained, stable, customer focused work force.  

Many chains are quick to rattle off “our turnover is 125%”, but what does that mean? If you are running a chain you really need to be measuring turnover at a deeper level. First and foremost there is a major difference between voluntary and involuntary. Voluntary indicates that the job was not right for the employee and they decided to leave. Involuntary means that the selected employee was not right for the company; they either could not perform the required job functions or violated work rules and were asked to leave.  

Once you measure the difference between involuntary and voluntary turnover, you need to determine the underlying causes and what can be done to reduce them.  Measuring turnover by store, district, region, or by job function can be quite eye opening, yet many companies fail to analyze their turnover at this level.  Well structured exit interviews and sharing best practices are two key ways to identify causes of turnover as well as ways to mitigate it that are already working in your company.  With labor as the number one direct operating cost of every c-store retailer, understanding how to reduce turnover and maximize productivity and sales per employee should be at the top of every convenience store operator’s agenda. 

  • Sarah Roark

    Being new to the C-store industry, this is something that has baffled me from the get go.  How much money are organizations throwing down the tube on turnover?  It’s not just the cost of processing an applicant and allotting manpower to train them.  There is also a tremendous cost to a company’s brand when they have different faces behind the counter constantly.   When a long-term, well-liked employee leaves, it affects the other employees morale and productivity, as well as the customers perceptions.  It would be very interesting to know what percentage of turnover was the result of “bad hiring practices” (hiring the wrong people, be they incompetent, deceitful or just a ‘bad fit’) vs. retention issues (inability to keep good people for a multitude of reasons from low pay to inadequate training to bad management).  It would also behoove those companies to look for correlations with certain locations, particular managers, differences in on-boarding and training, employee engagement scores, etc.  Seems to me there is an awful lot of money being wasted on the revolving door model!

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