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The Dive | Retail workers tell us that retail is not dead, and they’re not worried about job security

By December 21, 2019Perspectives, The Dive

TL;DR – But the retail bosses should be worried, very worried.

We saw a number of retail brands exiting the Singapore market or closing down either all of some of their stores in recent years. Let us list some of these brands to jolt your memory.

Curious about whether people who work on the retail floor are worried for their job security, and whether they are making plans to switch to another industry or job since the bricks and mortar retail scene seems increasingly challenging, we spoke to some retail people this week.

We asked the retail people if they are afraid of losing their jobs

We spoke to 10 retail people separately and they were unanimous in their replies to us. It is almost spooky how they all sang the same tune, despite being from different brands and companies, shops of different sizes, retail jobs at different levels and also of different tenure.

  • Retail is not dead.
  • There is a severe manpower shortage when it comes to local retail talents.
  • There is progression in the industry, you just have to work hard for it.
  • Local retail talents are pretty much like “prized possessions”.
  • Retailing teaches you plenty, and yes, that includes skills that you can easily transfer to another job if you want to switch industry or job.

So yea, they are not exactly fearing for their job security, as they have confidence they can easily find another job, be it in retailing or crossing over to some other industry.

 

Here’s  what some of them had shared with us.

Shane, 21yo, retail floor staff, 1st year in industry

We asked the first-jobber why he had chosen to go into a retail job. He shared, “I chose retail as I personally prefer commission-based work as I can feel my hard work pay off immediately, and also because I get to talk to customers from all walks of life.”

When asked if he thinks there is opportunity in career progression in the retail industry, Shane said, “I believe in every industry there is definitely progression. It all depends on how much effort we want to put in.”

“And no, I don’t think retail is dead. Even though it’s true that online shopping is easily available now, but there are still a lot of tourists and locals who prefer to see and try the product before purchasing. Creating a bond with our walk-in customers also brings them back, hence I believe that the industry is definitely still relevant.”

Wendy, 27yo, retail floor staff, 3 years in industry

Wendy likes the retail business as she likes to be “actively moving around during work and able to meet and chat with new people everyday.”

She, too, does not think retail is dead at all. When we asked her what changes she has observed in the retail industry over the past three years, Wendy said, “The most obvious change is that customers’ expectations have gotten higher.”

Mr Chew, 32yo, Store Manager, 5 years in industry

Chew shared with us his reason for entering and staying in the retail industry. “The retail industry is the most commonly seen business in Singapore. Job scopes within the retail business is very wide, hence different career paths are possible through this work. For me, I chose to be go into retail because of the mobility of skills and experience from retail.”

He, too, does not think that retail jobs are dead-end jobs. “There is opportunity for progression in the industry, it is about working hard.”

“From the day I joined retail till now, there have been several pay increments, and I have also been promoted twice. So long as the store team is doing what is needed of them, the commission payout is within reach.

When we asked Chew to share the changes he has seen in the retail industry over the past three years, he said, “I think that the biggest changes in this industry over the last five years have to do with the customers’ profile, their buying pattern and spending power.”

“Conceptually, consumers feel that online is the new way of shopping, however in Singapore, it appears that the bricks and mortar way is still the traditional and main way of shopping… Just look at all the new malls that keep coming or upgrading. There are also plenty of new businesses opening up.”

Mr Ho, 39yo, Area Manager, 8 years in industry

Ho was previously from banking, but sales got affected during the financial crisis. He heard from friends that the retail industry was (and still is) short of local staff and Singaporean staff are “prized workers” and tend to have a more than reasonable opportunity for promotions if proven good. So Ho decided on a career switch and went from banking and corporate sales to retail. Along the way, he has grown to like the retail industry and he is now into his eighth year.

For Ho, he is really liking the challenge and he enjoys the business management part the most. We asked him if there is progression in the industry.

“For sure there is opportunity for progression, but it all depends on the individual. Even the pay packages for retail staff are good now. Compared to eight years ago when I first joined the industry, the pay is very competitive now. For some industries and especially for the bigger brands, they can pay really well. Even newbies can get paid amounts that are comparable to office executives due to the attractive commission.”

“I wouldn’t say retail is dead. It will always be here. Retail is still a major contributor to tourism. If you look at government spending, marketing spend, developers’ and mall operators’ spend, you can tell that retail will still be around. The challenge is locals are now so well-travelled and they are spending money overseas.

And also, online shopping. So the relationship between the brands and customers is very important. Brands need to innovate, refine and sharpen the service element and make the customers come back. It is not just about selling the products per se anymore.”

“Manpower is the biggest concern. Hiring locals are difficult.”

We were also curious how much retail people earn

Do you have any idea how much retail workers earn in Singapore?

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This salary guide from Kelly Services may give you an idea.

Salary guide for FMCG and Retail workers, by Kelly Services (via)

 

According to this salary guide, the more junior retail floor staff earn $1,400 to $3,000 a month, Retail Supervisors and Shop Managers earn $1,850 to $3,600, and Area managers $3,800 to $4,000.

We checked in with the retail profiles we were speaking with, and they also confirmed that the ranges are fairly close to market, except that Area Managers, also referred to as Operations Managers in some companies, can earn up to $5,500. But the higher-paying ones tend to be those who have to manage a larger number of stores.

What about possible career paths for retail people?

What if you want some progression in your career and don’t wait to stay in the same retail sales job forever? Well, there are several possibilities and options.

1. Work hard, show results and gun for a promotion!

Well, they can stay in-industry or even in-company and move upwards. For instance, one may join as a Retail Associate, move to Senior Retail Associate, to Assistant Supervisor, to Supervisor, to Assistant Shop Manager, to Shop Manager, to Area Manager.

Good retail talents are hard to come by, as many Singaporeans shun away from having to work retail hours, which typically translate into working in the evenings as well as weekends. So it is not hard to gain visibility and catch the management’s attention if one is consistently good. The manpower shortage is real, and with the clampdown on foreign talents into Singapore, local retail talents have become even more precious. In an effort to retain staff, it is not uncommon to promote local staff.

So like all 10 retail people we spoke to, all agreed that progression is not a problem so long as one is reasonably good.

2. Job-hopping to a more senior and higher-paying job!

Other than staying in the same company, it is sometimes quicker to score a more senior position and higher pay with some purposeful job-hopping. You can apply for the next senior position with another company instead of waiting out at your current company in the hope that someone will vacant the next higher-up position and you can get bumped up.

That was what happened with Wendy who has been in the retail industry for three years and she has worked mostly in women fashion goods. We asked her if she had seen pay increase in her three years and she said,

“For myself, yes, pay has been increasing. I believe it’s due to the experience I’ve gained and also job change. As I gain more experience, allows me to get offers with higher position and better pay.”

3. How about moving to an adjacent job?

If you’re in retail, it is also possible to move to an adjacent job, be it in your same company or to another company in the same industry. Let’s have a look at Jennifer’s personal journey.

Jennifer, 42yo, Beauty & Service Trainer, 22 years in industry

Jennifer started as a Retail Assistant with an international fashion brand back in the 90s. She then moved to a beauty retailing business as a Supervisor. She continued to spend over a decade in retail, moving up from Supervisor to Shop Manager to Area Manager before taking on an opportunity to become a trainer in the backend.

Armed with her years of retail sales and shop management experience, she was able to transition into the Trainer role easily since she already had years of sales and service experience and product knowledge under her belt.

During her four years as a Trainer, she continued to upgrade and attended courses to become a more effective trainer. Once she felt she was ready, she then applied for a Trainer position with a bigger brand. She landed the job which came with a significantly higher pay.

Other than moving into a training function, other adjacent job functions may also include Stock Merchandiser, Visual Merchandiser, Buyer, or even Marketing.

4. Other than adjacent jobs, can also move upstream!

One other possible career path for retail people is to consider moving up the supply/value chain, for instance, you can join a distributor or wholesaler in the same industry. Your retail knowledge and experience would be an advantage when it comes to distribution and wholesaling work.

This was exactly what happened to Meng Hui.

Meng Hui, 41yo, Brand Manager, 20 years in industry

Meng Hui had joined the fashion retailing business after her GCE O levels, and thereafter, she landed a Supervisor job at a beauty retailing business. Just like Jennifer, she also moved up the ranks and eventually became Area Manager and managed up to five stores at one time.

As much as she enjoyed most of the retail work, she got tired of the people management part. So she decided to move upstream and became a Brand Manager, working for a Singaporean distributor that imports and distributes different beauty brands from overseas. She now takes care of one skincare and makeup brand from Russia and another haircare brand from Greece.

5. Retail skills are more portable than you think!

When in retail, you also pick up portable soft skills that are transferrable to another industry, another job. These skills include sales techniques and communication skills, which are critical to many jobs.

Janice, 38yo, Business and Sales Manager, 10 years in industry

Janice had spent 10 years in the retailing industry, mainly in the luxury fashion and beauty retailing business. Her last held position at the beauty retailing business was Shop Manager. She has since moved on to do B2B sales with an online media company, and has been doing so happily for the past eight years.

So, retail workers are not worried about their future, but the retail bosses ought to be!

There is a lot going on in the world right now. Due to digitalisation (and also globalisation), many industries are seeing sea change. Digitalisation brings about plenty of opportunities, as with new technology, there can now be new, different and more productive ways of doing things. Or previously un-served or under-served markets can perhaps now be tapped with the new technology.

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We say these are “opportunities” and they are for both existing players to take advantage of, as well as for new entrants.

So if you’re an incumbent in the market, and you pick up the new tech and apply it to your business to increase market share, to better serve your customers, to increase efficiency, to cut costs, then good on you.

But if you’re an incumbent and you do not do anything with the new technology and trends and you continue to do your business same old same old, then the “opportunity” then becomes a “threat” because someone else might seize that opportunity and outsell or outserve you. And that “threat” can come from yet another incumbent in the market or it can also come from a completely new player.

With so many retail businesses shuttering their stores, exiting markets, it is actually the retailers who need to be worried, and not the retail workers. The retail workers, if resourceful enough, can easily find another job. They can move to work for another retailer who is more successful in serving their targeted segment, or they can move to work in another job.

 

But what about the retail bosses?

Fundamentally, if you’re running your business full-time, you should be paying attention to the opportunities and threats that your business face and react accordingly.

And if you fail to seize the opportunities and if you fail to fight the threats, then perhaps your business deserve to close. Because it is not efficient.

Mr Ho, 39yo, Area Manager with eight years’ retailing experience, shared that the retailing business is dynamic and evolving and hence, it is critical that retailers adapt and adapt quickly to take advantage of the new technology and new opportunities.

“There’s so much happening all the time, it’s very dynamic. And the job involves all sorts of work, from people management, to the science of retail. Over time, customers’ profiles and consumers’ behaviour change as well. So trends and changes are inevitable, the cycle just keeps going on and on. We need to keep up.”

“In terms of challenges, skills required for retail and people management are less dynamic and these skills are easily portable. But in the backend and in terms of business management, it is a different ballgame. Marketing, technology, logistics, etc etc etc, there is a whole lot of things going on. Whilst you can say these pose challenges, but I think there are more opportunities in all these new developments than there are challenges.”

“The online-offline experience is very important. Getting people from online to shop offline, getting the walk-in customers from offline to become fans online and build loyalty. This is something that is increasingly important that our local retailers need to get comfortable with as it is the reality and it will stay. So we have to adapt and learn to thrive amongst these.”

Checking out the cool technology in the retail industry

Advancements in technology have been a game-changer in the retail. In the last decade, the impact of e-commerce alone on brick-and-mortar retail shops has been immense, putting even some well-known retailers out of business. Borders, once the go-to for books in Singapore, closed over 500 stores globally and let go of over 19,000 staff as trends shifted towards e-books and buying books online. This trend continues today, with in-store traffic suffering as more and more consumers become accustomed to shopping without ever leaving home.

Other technology trends are also beginning to gain a foothold in retail. Many retail outlets are providing seamless shopping experiences – integrating online, offline and mobile app shopping so that there is a uniform customer-centric experience. Afterall, the more touch points with a consumer, the more likely the conversion rate.

Digital payments and wallets are a thing of the present and paying with your mobile phone through payment apps, QR codes, Google/Samsung/Apple Pay is becoming increasingly common. In Singapore itself, many are already paying for purchases at retail or dining establishments with the likes of GrabPay, or FavePay.

In a time where labour costs are high and there is a manpower crunch, brick-and-mortar retailers that embrace technological innovations are on the road to being more competitive.

Automated checkouts or even “walk-out checkouts are becoming a trend where shops no longer need to have staff at the cash register. Robot store assistants incorporated with Artificial Intelligence can serve customers efficiently, offer real time promotion information and allow virtual searches, all without needing lunch breaks. That said, staff of retailers might be redeployed or laid off due to this disruption.

Retailers have no choice but to innovate in order to stay competitive.

Some has shifted towards an immersive customer experience with the use of augmented or extended reality. A customer can use a retailer’s mobile app to try on watches and rings in the comfort of their own home, try on outfits in store with the help of smart mirrors that allow shoppers to make better purchase decisions or shop for furniture and with the flick of an augmented reality app to see how their home would look like with that item.

Internet of things (IoT) and Big Data are also changing the face of retail.

By collecting and analysing customer data, retailers are able to deliver highly customised and targeted marketing to said customer. This data-first strategy of pairing customers with the most relevant products and services translates into higher sales. With the use of data to forecast demand and optimise prices, retailers can afford to spend less on warehousing while managing their supply chain and distribution more effectively.

 

These are just examples of how technology can be applied in retailing.

We wonder how many Singapore retailers are working on applying new technology on the old retailing business.

And we wonder, even more, how many enterprising digital natives are dreaming up business plans and working them to make retailing more efficient and along the way, squeeze out the traditional same-old-same-old retailers.

What challenges do retailers face despite government support for the retail industry?

Did you know that there are quite many Government grants and initiatives to help retailers digitalise their business and to train and upskill their staff?

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We asked several local business owners on the challenges the retail industry face and various reasons popped up: high operating costs, lack of support for local retailers and retail businesses failing to evolve to meet customer demands.

We chatted with Andrew Tan, founder of lifestyle brand atomi, a lifestyle and furniture gallery that specialises in Japanese designs.

“The government grants for retailers are helping the retailers to train the workers, yet this is simply adding to the high cost of operations. Again, we can see from the departure of Home Fix, Sasa and DFS, plus downsizing of Isetan, Metro and Crate & Barrel, that the high cost of operations are affecting the big boys. Micro SME and small businesses are suffering even more.”

“Another key killer is the high rentals which are unsustainable because of the low traffic and small market in Singapore. The good performance of REITs come at the expense of the business owners, which even international brands such as DFS, or established brands such as Sasa and Home Fix, are unable to survive, not to mention the smaller and younger startups and brands who have even less bargaining power than those mentioned above.”

A local entrepreneur, Mr Koh, who has been in the retail scene for several years and wants to expand overseas, said that it is a chicken and egg issue of expanding business whilst balancing against overhiring and overprocuring. He runs a lean team that is frequently overstretched to meet B2B orders (more regular, larger orders) and B2C orders (volatile, smaller orders), but he doesn’t want to hire more in case he is forced to downsize if the company loses a B2B client.

What about using technology to increase business competitiveness?

atomi has aggressively been investing and upgrading its technology to offer better services to its customers. The homegrown company has brought in wearable technology and virtual reality break through the limitations of high rentals, fixed assets and expensive delivery costs.

atomi’s wearable technology is a pair of smart glasses worn by the customer that displays related videos of the craftsmanship behind its products, triggered when the customer looks at specific products (via)

 

The smart glasses allows the customer to enter a virtual world and choose from a wide range of furniture online. He can then build an interior design simulation with the chosen furniture with a digital copy of his residence or shop. This helps customers envision how atomi’s furniture would look like in his premises before purchasing, and atomi saves on importing the furniture with its limited retail space. (atomi) (via)

 

Even with advances in technology providing multiple opportunities to retailers, Andrew Tan says,

“The expectations on retailers are tremendous. We are expecting retailers to go online, offline and be multi-tasking. There has been calls to harness technology and data analytics but these are all adding the pressure and cost of operations. We have to cope with high cost of rentals, even higher cost of labours, and highest cost of keeping up with the technology. Yet, the market is shrinking, spending by consumers are declining, and the overall economy is not doing well.”

Mr Koh already has an e-commerce website, Facebook, Instagram and twitter channel, and also lists his products on Lazada. For him it is less about technology and more about building networks, brand awareness and customer trust in his company, which require time and manpower – limitations for a retail startup like his.

It is also about how deep one’s pockets are.

Andrew Tan says,”The top challenges facing the retail business owners are multi-faceted.”

“On the macro-front, we are seeing the trade wars ongoing, with restrictions faced to protect their home markets, i.e. China, United States, etc. Yet, Singapore, despite being a small market, do not have any protection for anyone. We face global competition, online and offline. And most Singaporeans are happy to travel aboard to buy overseas or buy online to save on the GST.”

“International brands who are coming to Singapore, have their strong local market to allow them to fund loss market deals in Singapore just to have a global presence. HomeFix, being a strong local brand, and having been highlighted by PM Lee for taking a lead to go online, train workers etc during the May Day Rally, have faced difficulties because his online competition have deeper pockets to withstand losses. The stiff competition from online players who are making losses could be a big factor disrupting his market. Else, how could some online platforms have losses several times higher than its revenue? It is because they have strong fundings and support to crowd out the competition.”

Would more support for local brands and businesses help?

Andrew Tan also highlighted the “serious need to have a mindset shift of consumers to support good local brands.”

“If consumers do not support local brands, the mountain that retailers have to climb will be an even more difficult task. Global expansion of brands begin at home. Without protection, we can never develop strong global brands.”

Mr Koh adds that local support definitely helps, which is why his company participates in local trade shows and exhibitions to beef up brand and product awareness.

Retail business is really tough business in Singapore

Yes, we get it that retail business is really tough business in Singapore.

Firstly, the rental is quite ridiculously high and the footfall usually doesn’t justify the rental per square foot. Secondly, manpower cost is very high too. This, coupled with the fact that it is hard to recruit and retain local retail staff, makes this part of managing the business tough. Recruitment and training costs can be high too due to the high turnover.

Those in retail would know that retail is detail. And by this, it also means watching over every dollar, every cent, every percentage of spend. And this means ensuring that the gross profit margin is maximised, and all other costs are kept efficient.

We set off wanting to share the plight of how retail workers might be fearful of their future in terms of job security, only to find that they are actually in a good place, so long as they stay adaptable and open to learning new retail tech.

It is the retail bosses we should be worrying about.

After all, if these boss are not adaptable and quick enough to tap on the opportunities that digitalisation can bring, they could find themselves out of business soon!

 

(Featured image via)

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The Editor

Author The Editor

Either busy trying to save the world, or poking my nose into other people's affairs.

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