Thinking of Raising Wages? How About Raising Standards?

"The increases in the minimum wage will cause a ripple effect, increasing the expectations of all employees for pay increases." Or so goes a common line of thinking. 

This can prompt independent retailers to worry:

• How much will we have to increase prices in order to pay our staff more? 
• Where is that money going to come from? 
• What will we have to cut in order to pay more? 

Or, is there another way to think about this? How about raising standards and expectations to better match with the wages paid?  (You know, the "You get what you pay for" model.) 

Here's how to start:

• First, revisit your job descriptions. This is the first opportunity to raise standards. Make sure they reflect the performance you now expect from each position. 
• Consider delegating much of the initial data-gathering and drafting of job descriptions to someone else in your organization (especially a younger someone else!) Their energy and fresh perspective could be very valuable.
• Then, having clarified the job descriptions and performance expectations, establish an appropriate pay range for each job.
• Finally, make sure your employees each understand the new responsibilities, and the heightened expectations, of the positions in your stores. In fact, some owners have current employees essentially apply and compete for those higher-paying jobs.

For more ideas, and a process for doing this, read "Beyond the Paycheck: Motivate Employees with Creative Compensation", in the Library for Owners at The Retail Owners Institute®. 

It walks you through the entire process (including finding out what matters to your employees!) 

For most specialty retailers, your staff IS your competitive advantage. Use your compensation plan as another strategic tool to:

1. reduce employee turnover;
2. save expenses of recruiting, hiring, and training of new staff;
3. and most important, maintain customer satisfaction and loyalty.