Running a retail operation is not as easy as it used to be.

With buyers' preference becoming more sophisticated, consumers demanding more value for their money and increasing plethora of choices in the market, retail firms like malls and specialty shops have had to improve their game to convince customers to part with their money in their outlets.

Ranj Basi, marketing head of the Abensons appliance store network, says customers these days know the products well and they expect the service personnel to know more than they do. They expect, and even demand, good service such as fast transactions, reasonable payment terms and pleasant staff.

But this is much easier said than done, as retail experts in the Philippines will readily say, and hiring the right people is one of the biggest problems facing the industry.

Roland Rowell Villareal, assistant vice president for human resources of Robinsons Department Store, says the task of hiring competent managers has become more difficult than before because the good, competent ones are leaving for higher-paying jobs abroad.

"Competent applicants now have more job opportunities to choose from and they consider not just compensation, growth and stability, which retail offers, but flexibility of working schedule and employee incentives," Villareal says. "To top all that, there is the challenge of hiring employees with selfless service and dedication, given that in retail, more work hours are required."

Berniu Liu, who owns the Penshoppe retail line in the Philippines, agrees.

"The supply for competent managers is low while demand is high. Retailing requires specific set of competencies. Unfortunately, in our country today, there are very limited structured academic programs available for those who are interested in building a career in retailing," Liu says.

Liu says not too many Filipinos are considering a career in retail because of perceptions, some say unwarranted, that there is no room for career growth.

"Yes, it is difficult because of the existing perception that being a retail associate is a low-paying minimum wage job. But this is not true anymore since companies like ours provide attractive sales incentive packages to front-liners, which gives them the opportunity to earn as much pay equivalent to that of a supervisor level of most companies. This wrong perception is partly the reason why our country is losing its good front-liners to offshore retailers," Liu says.

Alegria Sibal-Limjoco, vice chairperson of the Philippine Retailers Association, says the flight of talent to overseas, particularly in the United Arab Emirates where most of the retail stores are manned by Filipinos, presents a major challenge to the retail industry which is already grappling with fierce market competition and the shrinking buying power of consumers.

"In general, retail is considered an unattractive career option due to the perceived low regard for the retail profession, perceived low salary, long work hours, work on holidays and weekends, perceived limited career opportunity and frequent relocation," Limjoco says.

Strategies to cope

Retail firms are using different strategies to cope with the daunting challenge presented by lack of competent managers.

For Liu, the solution is in continuous training, which encourages some good talent to stay.

"Companies have no recourse but to develop their own training and development programs while others simply field their managers to the shop floor and just hope that they will learn the ropes along the way," he says.

"Extensive training for professional and personal growth is a good motivation that attracts applicants. As the demand of the customers change and competition becomes stiffer, the investment in the development of retail personnel's skills in customer service has become inevitable," adds Villareal. "Thus, the promise of these skills development coupled with the stability and aggressive expansion programs of the organization are two important factors that encourage and attract talents who value a stable career and steady employment."

According to Dina Arroyo-Tantoco, marketing manager of high-end retailer Rustan's, in these competitive and uncertain times, employee relationship management has become as important as customer relationship management.

This is why the Rustan's group is seriously developing the talents and skills of its front-liners since they deal directly with the customers. By doing so, it believes that customer loyalty will follow.

"If we want to increase the loyalty of our customers, we would like also to improve the loyalty of our employees," Tantoco says during the recent National Retail Conference and Stores Asia Expo organized by the Philippine Retailers Association, citing studies that show that employees who are happy working with the company results in a better performance of the company.

Employee programs

Tantoco adds that through the employee relationship program, the company gets to retain the best performing employees as they eventually form the core of the management of the company and Rustan's is able to spot young talents ready to take on higher responsibilities.

Penshoppe implements a similar program.

Liu says Golden ABC, which owns the Penshoppe brand, has put up a structured training program dubbed the golden ABC academy in coordination with the University of the Philippines' Clothing Technology Program. Added to this are employee programs that allow people to be enriched socially, emotionally and spiritually through activities like tree planting, blood-letting and health fairs.

"As a learning organization, GABC constantly reviews its training programs to ensure that they are always effective and relevant. A challenge thought that GABC is facing due to its presence across the country is ensuring that the front-liners who are based in the provinces are still afforded with due training and development programs," Liu says.

Basi shares the belief that training front-liners is crucial to the success of any retail company because they act as ambassadors of the brands they are selling.

"The front-liners are the face of the brand. So if you want to really communicate what your brand is about, the front-liners should exemplify it. For Abensons, this means that the people must be able to recommend products and be knowledgeable about their features," Basi says.

The retail industry cannot afford to stay idle and just relegate training to the back burner because it has a big impact on the Philippine economy.

According to the National Economic and Development Authority, there are about half a million retail establishments in the country and they account for some 15 percent of the country's gross national product and 33 percent of the services sector. It employs more than six million people or about 19 percent of the country's total workforce.

At the same time, retail gross value-added (GVA) accounts for 12.8 percent of the gross domestic product, 26.4 percent of the entire services sector’s GVA, and 76.0 percent of the trade sub-sector's GVA.

With a lot at stake, retailers are bound to improve even more on their operations. They really have no other choice.