Retailers Working to Reduce Store Manager Turnover: Survey
EAST BRUNSWICK, N.J. -- A survey of human resources executives at retail companies by retail executive recruiting firm Career Management here has found that the industry has accelerated efforts to reduce turnover of store managers. The survey covered a variety of compensation and benefits issues for store managers across all retail channels, with the participating companies operating a total of over 12,000 locations nationwide.
"The industry's moves to make store management positions more appealing was underscored by the fact that over 80 percent of the companies surveyed indicated that their managers now average under 50 hours per week," said Lloyd Lippman, c.e.o. of Career Management and an adjunct professor of retail leadership skills at the Fashion Institute of Technology in New York. "Not too long ago, most managers we were placing typically worked at least 55 to 60 hours per week."
More specifically, store managers at 27 percent of the companies polled worked up to 44 hours per week, and 54 percent worked 45 to 50 hours. Managers at another 17 percent of the companies averaged 51 to 59 hours per week, while only 2 percent averaged 60 hours or over.
The survey additionally found that store managers were eligible for performance bonuses at an overwhelming 92 percent of surveyed companies. Among those companies offering bonuses, 41 percent gave bonuses of up to 9.99 percent of the manager's base salary, 35 percent were in the range of 10 percent to 19.9 percent of base salary, 16 percent were in the range of 20 percent to 29.9 percent, 4 percent were in the 30 percent-to-39.9 percent range, and another 4 percent offered bonuses of over 40 percent of base pay.
The bonuses were paid on top of salaries that mostly averaged under $60,000. Measured across all store volume categories, almost 60 percent of the chains polled said that average salaries for store managers (excluding bonuses and other compensation) were less than $60,000, with 17 percent paying less than $40,000, 31 percent in the $40,000-to-$49,999 range, and 11 percent in the $50,000-to-$59,999 range. Salaries averaged in the $60,000 to $69,999 range at another 17 percent of the companies, while 10 percent were in the $70,000-to-$79,999 range, another 10 percent were in the $80,000-to-$99,999 range, and 4 percent paid average base salaries of over $100,000.
"Although our experience has shown that base salaries for store managers have been on the rise, one could still argue that compensation is not commensurate with leadership positions at other businesses generating the level of annual revenues produced by stores," observed Lippman. "Retailers have sought to shake their longstanding reputation as mediocre payers by offering considerable bonuses tied to store sales, profits, shrinkage, and other metrics, along with a variety of other benefits."
These benefits included generous employee discount programs for store managers, with 29 percent offering discounts of over 40 percent, 27 percent giving discounts in the 30 percent-to-39.9 percent range, 25 percent in the 20 percent-to 29.9 percent range, and the smallest group, 19 percent, offering discounts up to 20%.
Further, 96 percent of the companies polled provide 401k plans for store managers. Among those providing plans, the biggest group, 45 percent, will match employee contributions of over 3 percent, while 21 percent will match up to 1 percent, 16 percent will match up to 2 percent, and 18 percent will match up to 3 percent.
When it comes to health benefits, the survey discovered that most companies require managers to contribute to their policy premiums. Excluding costs for additional family members, only 8 percent of the companies cover the full premium for their store managers, while 21 percent require a contribution of up to 9.9 percent of the premium cost, 27 percent were in the 10 percent-to-19.9 percent range, another 27 percent were in the 20 percent-to-29.9 percent range, 13 percent were in the 30 percent-to-49.9 percent range, and only 4 percent required managers to pay over 50 percent of their individual premium.
Looking at compensatory time off and vacations, the survey found that 38 percent of companies polled offer comp time to store managers who work more than their allotted hours for a week. The average vacation policy for store managers at responding companies was two weeks after one year, three weeks after five years and four weeks after 10 years of service.
"The industry's moves to make store management positions more appealing was underscored by the fact that over 80 percent of the companies surveyed indicated that their managers now average under 50 hours per week," said Lloyd Lippman, c.e.o. of Career Management and an adjunct professor of retail leadership skills at the Fashion Institute of Technology in New York. "Not too long ago, most managers we were placing typically worked at least 55 to 60 hours per week."
More specifically, store managers at 27 percent of the companies polled worked up to 44 hours per week, and 54 percent worked 45 to 50 hours. Managers at another 17 percent of the companies averaged 51 to 59 hours per week, while only 2 percent averaged 60 hours or over.
The survey additionally found that store managers were eligible for performance bonuses at an overwhelming 92 percent of surveyed companies. Among those companies offering bonuses, 41 percent gave bonuses of up to 9.99 percent of the manager's base salary, 35 percent were in the range of 10 percent to 19.9 percent of base salary, 16 percent were in the range of 20 percent to 29.9 percent, 4 percent were in the 30 percent-to-39.9 percent range, and another 4 percent offered bonuses of over 40 percent of base pay.
The bonuses were paid on top of salaries that mostly averaged under $60,000. Measured across all store volume categories, almost 60 percent of the chains polled said that average salaries for store managers (excluding bonuses and other compensation) were less than $60,000, with 17 percent paying less than $40,000, 31 percent in the $40,000-to-$49,999 range, and 11 percent in the $50,000-to-$59,999 range. Salaries averaged in the $60,000 to $69,999 range at another 17 percent of the companies, while 10 percent were in the $70,000-to-$79,999 range, another 10 percent were in the $80,000-to-$99,999 range, and 4 percent paid average base salaries of over $100,000.
"Although our experience has shown that base salaries for store managers have been on the rise, one could still argue that compensation is not commensurate with leadership positions at other businesses generating the level of annual revenues produced by stores," observed Lippman. "Retailers have sought to shake their longstanding reputation as mediocre payers by offering considerable bonuses tied to store sales, profits, shrinkage, and other metrics, along with a variety of other benefits."
These benefits included generous employee discount programs for store managers, with 29 percent offering discounts of over 40 percent, 27 percent giving discounts in the 30 percent-to-39.9 percent range, 25 percent in the 20 percent-to 29.9 percent range, and the smallest group, 19 percent, offering discounts up to 20%.
Further, 96 percent of the companies polled provide 401k plans for store managers. Among those providing plans, the biggest group, 45 percent, will match employee contributions of over 3 percent, while 21 percent will match up to 1 percent, 16 percent will match up to 2 percent, and 18 percent will match up to 3 percent.
When it comes to health benefits, the survey discovered that most companies require managers to contribute to their policy premiums. Excluding costs for additional family members, only 8 percent of the companies cover the full premium for their store managers, while 21 percent require a contribution of up to 9.9 percent of the premium cost, 27 percent were in the 10 percent-to-19.9 percent range, another 27 percent were in the 20 percent-to-29.9 percent range, 13 percent were in the 30 percent-to-49.9 percent range, and only 4 percent required managers to pay over 50 percent of their individual premium.
Looking at compensatory time off and vacations, the survey found that 38 percent of companies polled offer comp time to store managers who work more than their allotted hours for a week. The average vacation policy for store managers at responding companies was two weeks after one year, three weeks after five years and four weeks after 10 years of service.