5 ways to prepare your restaurant employees when you raise menu prices

5 ways to prepare your restaurant employees when you raise menu prices

There are a number of challenges facing the foodservice industry as organizations navigate the post-pandemic “new normal.” Causing the greatest disturbance to operations today, however, is the unprecedented and continued global inflation. It’s resulted in increases to the price of just about everything, including restaurant menu items. 

The producer price index for food manufacturing was up 14% year over year from January 2021 to January 2022. Full-service menu prices are up by almost 9% year over year, inflation has hit a 40 year high, and operators are planning more increases because they’re still not recovering lost profit margins. And this is all on top of rising labor prices and major supply chain delays and shortages. 

According to industry expert George Minakakis, it’s a situation that requires organizations to prepare their staff in order to properly meet customer needs.

“Consumers who frequent restaurants will notice pricing changes that are currently happening pretty much right across the board,” he says. “In fact, you would be surprised how many people will even notice a five-cent increase on a cup of coffee. What this results in is undue strain and stress on restaurant employees, particularly frontline staff, who are burdened with conveying, almost justifying, the menu increases to customers. The key in addressing this issue, and in preparing staff to be able to do this most effectively, is to ensure clear and strong communication with them.”

But if done properly, Minakakis says, if the internal message is managed, then the customer story will be managed as well. It’s a concept that he’s developed throughout his extensive leadership career within the retail and foodservice industries, which included working as Franchise Business Development Leader at what is now YUM! Brands – the Fortune 1000 corporation behind KFC, Pizza Hut, Taco Bell, The Habit Burger Grill, and WingStreet. 

The idea of managing this internal message starts with providing restaurant employees with the information and understanding necessary to do their jobs with confidence. 

Here are Minakakis’ top 5 ways to prepare restaurant employees when you raise menu prices.

1. Educate your staff

The first thing to do, advises Minakakis, is to educate staff concerning the reasons why prices are increasing. And, in order to ensure adequate transparency, he urges owners and managers to be honest about the reasons. It will arm staff with the knowledge they’ll need when responding to inquisitive customers.

“Let your employees know that inflation and cost increases are a global phenomenon that everyone, everywhere, is trying to work through. Explain that the adjustments that have been made have been done as reasonably as possible, highlighting exactly how much the price increases are and for which items on the menu. The more they know, the more effectively they’ll be able to manage the customer story for the brand,” he says.

2. Focus on continued value

Minakakis explains that in order to continue satisfying customers in light of menu price increases, a renewed focus on the value the organization offers should be underscored whenever possible.

“It’s no secret that recent increases to menu prices are, in most cases, simply meant to offset cost and ensure the same, if not greater, level of service and quality,” he says. “So, staff should be encouraged to focus on the value of the incredible service that’s provided and the amazing menu items that everyone enjoys. When the customer sees that service levels are maintained and that they can still enjoy their favorite meal, price increases for many quickly becomes a non-issue.”

3. Empower restaurant employees to provide options

Many customers will be curious to find out how long increased prices on the menu might last and if they might lower in the future. Minakakis suggests that restaurant owners and managers keep employees updated concerning the situation, including near-term plans. Understanding the current state of the market helps employees confidently answer these types of questions from customers. And, he adds, it’s actually a situation that provides frontline staff with the opportunity to become creative in the options that they offer customers.

“Employees have got to be aware of the restaurant’s plans with respect to pricing. A common inquiry over the course of the next few months will be whether or not pricing is going to come back down. Empower your staff, letting them know that it’s currently unclear whether prices will come down or not and that their message should be around uncompromising quality. Employees can explain to customers that in spite of price increases, the restaurant is always looking for ways to lower costs and offer greater options in order to deliver the value they seek,” he says. 

4. Prepare restaurant employees for angry customers

Angry and belligerent customers unfortunately come with the territory for anyone working within a customer-facing position. Minakakis says that it’s vitally important for restaurant owners and managers to not only prepare their staff with respect to explaining the price increases to customers, but to also ensure that they are ready to address negative questions and responses from angry guests.

“It’s probably one of the worst challenges about working within the foodservice industry. You’re not always going to please everyone. And, sometimes, people are going to get upset,” says Minakakis. “Restaurant employees dealing with the public need to be reminded to reiterate the reasoning for the price increases in these situations, explaining that the restaurant is dealing with the same market changes and inflation as everyone else. And, make sure that everyone reinforces the same message, maintaining consistency in communication.”

5. Make the visit about the experience

Minakakis points to pent up consumer demand for experiences as a great way for many to highlight the value in dining out. He says that by doing so, you’ll not only keep customers satisfied, but will also invigorate the brand and increase positive engagement with customers.

“It’s obviously incredibly difficult attempting to explain the reasoning behind increases to menu items. And, it also tends to distract from the real value in eating out with family and friends. It’s about being out and away from the house and in hospitable and friendly surroundings. It’s always very much been about the experience. And restaurant owners and managers should make sure that the experience, and the excellent service that helps support a great one, becomes the focus. When you make your guests feel welcomed and appreciated, you’d be surprised how quickly they’ll forget about menu price increases,” he says. 

The need for most restaurant owners to raise prices on at least some menu items is becoming an inevitability. However, as Minakakis points out, doing so does not at all mean that service, quality and a satisfied customer needs to be sacrificed. On the contrary, given the current economic climate and market conditions, it might be the ideal time for restaurant owners to become creative in finding ways to enhance the service they provide and quality they create in order to enjoy continued growth and success during these challenging times.

The Great Unburdening: Understanding employee burnout in foodservice

The Great Unburdening: Understanding employee burnout in foodservice

The past few years have been an extremely difficult period for many frontline workers,  leading to employee burnout in a number of different industries and roles. And it’s no surprise – the pandemic and associated impacts have influenced and, at times, altogether changed the ways we do things. 

But some of the most significantly affected are restaurant workers. Not only are they navigating an ever-evolving landscape and environment, they also need to do so burdened with longer work hours and staffing issues resulting in greater responsibility within their jobs. It’s a combination that Sylvain Charlebois, food industry expert and Senior Director at the Agri-Food Analytics Lab at Dalhousie University, says is resulting in employee burnout and stress.

“Employee burnout within the foodservice industry has become a big problem that employers need to figure out,” says Charlebois. 

“The sector has been under tremendous pressure, battling rising food prices, supply chain issues, and heightened guest expectations. And all of this is happening during a labor crisis. The past couple of years, which have consisted of daily changing market conditions, have resulted in a great deal of uncertainty for everyone involved. Many restaurants have closed for good. Some of them were institutions. This kind of unpredictability causes overwhelming anxiety for many.”

Causes of employee burnout in restaurant workers

Charlebois explains that there are a number of factors that are contributing to the employee burnout currently threatening the foodservice industry. First and foremost, as a result of an ongoing labor shortage, many restaurants and other foodservice establishments have been operating understaffed, some of them severely so. This places undue pressures on staff who are expected to pick up the slack left behind by departed colleagues. And, of course, the fallout from the COVID-19 global pandemic has also taken its toll on foodservice employees, resulting in what Charlebois describes as a “larger mental health issue.”

“Impacts of the pandemic have resulted in a great deal of uncertainty for many restaurant employees within the foodservice sector,” he says. 

“They’ve been showing up to work every day generally unsure as to the safety and security of their jobs as well as the health of the businesses they’re working for. In addition, many of their jobs and the way they used to do things changed overnight. The ways they interact with and serve the customer changed. Some establishments also introduced new services like curbside pickup which requires new skills, new equipment and new ways of doing things. As a result, many had to essentially retrain themselves, on the fly, in order to continue doing their job effectively. It’s all caused an incredible amount of stress and adds up to a big mental health issue that operators within the foodservice sector have got to address.”

How employee burnout impacts foodservice organizations

The negative effects of poor mental health for individuals are obvious and debilitating. And, for organizations, the impacts can also be detrimental, stunting productivity and hindering progress and growth. However, Charlebois points out perhaps the most draining impact that a burnt-out workforce can have on an organization is the increased turnover that it invariably causes. 

Wellness program developer Limeade’s 2021 survey talked specifically to employees who started a new job in 2021. It found that a whopping 52% of workers within the foodservice and hospitality industries who left their jobs did so due to burnout. The study also found that those who left their job without another job lined up were 1.7x more likely to cite workplace mental health impact as their top reason for leaving.

Further, Nudge’s recently released Foodservice Deskless Report finds that 38 per cent of foodservice frontline workers currently wish to quit their jobs, with burnout among the top three reasons for doing so. It’s a worrisome trend, says Charlebois, who believes that it couldn’t be happening at a worse time, given the current criticality around attracting and retaining talent.

“The greatest impact that employee burnout has on an organization is the way in which it erodes the workplace culture,” he says. 

“It shows up in absenteeism and employees not fulfilling their entire duties. It leads to discontent and, at times, an embittered and antagonistic workforce that does not feel valued or cared for. Suddenly, establishments and businesses are left with a decayed culture that’s driving employees out and turning away the interest of prospective workers. And, right now, given the near-impossible task of recruiting talent, restaurant managers are finding it extremely difficult to run successful locations.”

Developing programs and initiatives to improve employee burnout

In order to deal with this incredibly important workforce issue, some organizations are beginning to develop and implement mental health and wellness programs to help care for employees and enable them to succeed. 

Burger restaurant chain Wendy’s, for instance, says that it is taking a more holistic approach to employee wellness than it has in the past, instituting training programs meant to assist managers in becoming more sensitive to mental health issues. Chick-fil-A recently adopted a program called Abound which provides employees with access to a wellness coach who can help address mental health and wellness concerns, among other things. Others within the industry that are following suit.

The development and implementation of these programs and initiatives are a positive sign, says Charlebois, that organizations are beginning to pay more attention to their employees’ concerns, focusing more on providing them with solutions and support. He adds that it’s all rooted in listening and proper communication from management. In fact, according to Nudge’s Foodservice Deskless Report, it’s exactly what many organizations are realizing, with 76% of leaders within the sector committing to investing more into the employee experience. More than a third (36%) plan to invest more into communication and a quarter (25%) plan to invest more in feedback.

“Taking a good look at the organization’s communication and engagement with employees is a very good place for leaders within the foodservice sector to start in terms of addressing employee burnout and concerns over mental health,” says Charlebois.  

“And they should do so through a lens of compassion, asking themselves whether or not their employees feel cared for. They’ve got to convey the message to their employees that their work environment is a safe place for them to share any difficulties, personal or otherwise, that they might be facing. The pandemic has brought a new dimension of consideration to the workforce, and it’s becoming vitally important that employers understand that the challenges faced today are not just about a disrupted supply chain or inflation. It’s also very much about the people that they rely on to achieve success.”

The future of frontline leadership? Empathy

The future of frontline leadership? Empathy

The last couple of years have been challenging for retailers. Government-imposed restrictions and social protocols have impeded the ability of many merchants to keep their doors open. Now, as those restrictions loosen and we slowly and methodically move toward a new kind of “normal,” the industry is faced with a different kind of challenge in the form of a talent shortage. 

Thanks to “The Great Resignation,” scores of retail workers have left their jobs and, in many cases, the industry altogether. It’s causing headaches for many, leaving merchants scrambling to fill roles within their stores. However, it’s also brought some organizations to realize just how important their frontline staff are in helping them achieve their goals and objectives. 

And, according to Sarah Jordan, CEO of specialty toy and book retailer Mastermind Toys, it’s imperative for retailers to lead their teams with empathy and compassion.

Over the past two years, Canadians have faced a variety of impacts and new experiences as a result of the pandemic,” she says. 

“Companies must empower frontline employees by leading with empathy and compassion to inspire innovation and creativity. Leaders need to be considering how there’s strength in being empathetic and courage in being compassionate. These are the qualities customers and employees are seeking now more than ever.”

In order to continuously improve the culture at Mastermind Toys – a retailer that employs a workforce across its head office, warehouse, and 68 stores coast-to-coast – Jordan ensures that she and her team consistently facilitate touchpoints that allow her to stay connected to employees of the brand. Quarterly employee surveys, Town Halls, and Nudge used daily by their “Play Experts” (a.k.a. store associates), provide an incredible opportunity for employees from all levels to come together, share ideas, and better understand the ways in which their colleagues contribute, leading to a deeper collective appreciation for the work being done. 

Jordan suggests that empathetic leaders also have a profound impact on the performance of frontline employees and the overall corporate culture and values. But the benefits of creating a culture of empathy and compassion run even deeper. According to a report by Development Dimensions International, leaders who approach their jobs and engagement with employees with empathy display interaction skills that are more effective than those who do not practice empathy. The report indicates extremely strong links between a leader’s levels of empathy and the quality of their decision-making, coaching, engagement, planning and organizing, and overall performance. 

Here are 4 ways Mastermind Toys’ empathetic frontline leadership motivates and inspires employees:

1. It inspires creativity, innovation, and performance

When it comes to employee performance, a recent study by Businessolver reveals that 72% of employees believe that empathy drives motivation, while 84% of CEOs believe that it drives better business outcomes. According to Jordan, it does both.

“The impact of an empathetic mindset is tremendous and goes a long way toward shaping and enhancing an organization’s corporate and workplace culture,” she says. “ It impacts every corner of the business, helping to motivate employees, drive innovation, inspire creativity and reach business results together.”

2. It boosts employee engagement

In addition to enhanced employee performance, one of the more meaningful benefits of empathetic frontline leadership is a highly engaged group of employees. It’s a benefit that Jordan says can really galvanize a team of individuals, adding that the critical support is strong communication (case in point: over 90% of Mastermind Toys employees reported that they understand the business strategy in a recent employee survey). 

“Constant communication with frontline employees definitely helps to keep them engaged,” she asserts. “But, in retail especially, employees become trendspotters that drive innovation and inspire change when there is that trust in place and open lines of communication. And, in building an engaged community, you create an environment where people are excited to be part of the team.”

3. It fosters honesty and transparency

According to Jordan, ensuring that lines of communication are always open is an important aspect of an empathetic approach to leadership. It also makes it easier to elicit feedback from employees, encouraging inclusiveness and trust.

“At Mastermind Toys, we pride ourselves on embracing a culture of co-creation, where we ask employees for feedback, really listen to it, and then communicate back how they have been a part of our innovation. Co-creating with your employees is most effective when you lead with empathy and compassion because it gives your employees permission to be honest and transparent and the space to bring their authentic selves to work. In our latest employee survey, we heard 90% of our employees say they trust their supervisor – a number we believe represents the work we’ve put into ensuring we create an open and safe environment.”

4. It drives greater retention

Leading with empathy doesn’t simply help to engage employees, however. It also serves as an incredibly powerful tool to help retain that talent.

“When you can create an environment that’s inclusive, providing employees with work-life balance and flexibility when it comes to scheduling, you earn their trust,” says Jordan. “We were provided an example of this over the past holiday season. When the industry was concerned with labour shortages, we welcomed over 75% of our seasonal shift leaders back to Mastermind Toys for another holiday season.”

Tips for leading with empathy

According to Jordan, if a retail leader is able to cultivate and nurture a culture of empathy and compassion within their workplace for frontline employees, the rewards are immense. The employee experience drives the customer experience – encouraging and empowering frontline teams will keep your customers coming back.

In order to start down this path, Jordan has three pearls of wisdom to offer:

1. A culture of care and compassion is established by the CEO

“The CEO needs to be the leading brand ambassador – the person who brings the company values to life and sets priorities that are consistent with the brand purpose. When this is the case, the objectives of the brand and its vision and purpose motivate employees, inspiring them to come together as a team to deliver innovation and impact.”

2. Genuinely listen to your employees, and then act with intention and speed

“Actively listen to employee feedback to uncover insights and then create a roadmap of next steps to reinforce that their contributions matter. The follow-through plan and execution by leadership is just as important as getting employee buy-in and it encourages exponentially more insights shared. Employees are often simply looking to see progress, not perfection, from their employer.”

3. Leading with empathy and compassion lets your team play to their strengths.

“As a leader of Mastermind Toys, I have found the most rewarding part of my job is the opportunity to elevate our culture by showing up as an authentic leader and encouraging others to do the same. When employees can be authentically themselves, their strengths shine through.”

Though empathy and compassion are not often at the top of the list of skills referenced when assessing the strengths of any leader, they are increasingly coming under greater focus and consideration as a new leadership style whose significance has been amplified by impacts of the pandemic. And, it’s a leadership style that Jordan believes is exactly what today’s workforce deserves.

“People are looking for purpose-driven organizations and leaders to work for. Over the pandemic, Mastermind Toys formally articulated our purpose and values that have always rung true within the company, but it was important that we strengthened these pillars of who we are by clearly communicating them to our people. We are more than a toy store – we are Canada’s Authority on Play, whose purpose is to inspire generations of lifelong learners through the power of play. When employees understand your purpose, and the role they can play in achieving this purpose through living out your values, it develops a greater sense of connection across your teams and builds your unique company culture.”

The true value of investing in retail employee training and development

The true value of investing in retail employee training and development

Retail operation is, regardless of the category or vertical, a complex ecosystem comprising a number of different layers and components. From location, product assortment, and pricing to merchandising, marketing, and inventory management, each cog in the retail wheel needs to be functioning at a near-optimal level in order to contribute toward the overall success of any organization. 

But  efforts made by retailers within these areas wouldn’t be possible without its people. According to Kevin Graff, retail training and development expert and Founder and President of business management consulting firm Graff Retail, the current talent shortage blighting the industry should make retailers take notice of the value and differentiating potential inherent in providing strong employee training and development for their employees.

“If you expect your employees to remain within your organization, it has to be about more than just showing up to work,” Graff says. 

“It’s death just waiting to happen if employees are turning up for shifts for the sake of working shifts. What opportunities are you providing for them to learn, collaborate, share ideas, grow and develop? People have always wanted these opportunities. But today, there seems to be a growing expectation of them. If an employee isn’t happy within their job, there are about ten other jobs they can get tomorrow. So, why are they going to continue working within their current jobs? If the retailer isn’t going to nurture their employees and help them grow as individuals, they’re going to need to pay them lots of money and offer phenomenal benefits. But, that’s a short-lived game because eventually someone else comes along and offers more money and better benefits.”

Graff goes on to underscore the importance of providing retail employees with training and development opportunities, stressing the significance in doing so toward satisfying their needs and improving the experience enjoyed by today’s workforce. 

In fact, his notion is supported by findings within a recent LinkedIn Workforce Learning Report which reveals that an astounding 94% of employees say that the provision of learning and development opportunities would be a strong enticement for them to remain in their current jobs. And, the increasing demand for learning is especially true among younger generations, with more than a quarter (27%) of the Millennial and Gen Z cohorts stating that a lack of training represents the number one reason they’d consider leaving their jobs.

Given this growing sentiment around training and development, it seems clear that offering employees the right learning opportunities will help merchants and businesses significantly decrease turnover. However, Graff says that employee training isn’t just a powerful tool that can be leveraged to retain talent within the organization. There are numerous other benefits that can enhance the business and the employee experience, not to mention differentiate the brand from competitors:

1. Increased employee engagement

One of the most compelling and meaningful benefits that results from providing employees with opportunities to grow, says Graff, is their increased engagement with the brand and its objectives.

“How do you, as a business owner, get your employees to care as much about the business as you do? By providing your employees with the right opportunities to learn and grow, they start to understand and connect to the vision of the business, which then supports their ability to execute on the brand promise and work toward its overarching objectives.”

2. Greater clarity concerning roles

Along with increased engagement, Graff points out that by building employee learning and development processes, retailers also help define expectations within the organization, creating a basis for employee success.

“Effective training and development go a long way toward clarifying roles for employees, reinforcing through this type of investment the fact that they’re incredibly important to the business. It defines expectations from a behavior perspective and helps employees better understand how they’re contributing to the success of the business and their colleagues.”

3. Enhanced collaboration and performance

A greater understanding of their individual roles and the roles of their colleagues, explains Graff, then results in increased collaboration and performance. In fact, according to recent Gartner research, employees who have received adequate development opportunities within their organizations are 44% more likely to be high performers than those who have not been offered the same or similar formalized training.

“It just makes sense that an engaged employee who understands their role within the company will be more able and willing to execute at high levels. And when you put your employees in this kind of position, you’ll see a consistent rise in average basket size, conversion rates and ultimately sales.”

4. Sparking creativity and innovation

In addition to increased employee output, another layer of performance that’s positively impacted by the implementation of employee training and development is the levels of creativity and innovation within the organizations offering it.

“An employee who feels valued and important with respect to the overall goals and objectives of the business is an employee who wants to share ideas and insights,” says Graff. 

“It’s as simple as that. And when your entire staff feel this way, collaborating and contributing toward the success of the business, everyone wins.”

5. Improved employee and customer experience

Despite the many benefits that result from providing employees with learning and growth opportunities, Graff insists that the greatest payoff is in the enhanced experience that customers of the brand receive. After all, he says, providing exceptional service is what retail’s all about.

“As a result of a recent decrease in foot traffic to physical brick-and-mortar stores, interaction with the consumer is more important today than ever before. Store managers don’t often control the product selection, price, store design, or really much of anything else within the store. But where they do have impact is in the performance of their staff. How you hire, train, manage, coach and lead your employees is directly correlated to the levels of staff knowledge and quality of service that’s provided and, as a result, satisfaction among consumers.”

Considering the current talent shortage faced by retailers across the industry, a shortage that’s presenting significant challenges with respect to staffing frontline customer-facing positions, Graff suggests that the time is now for organizations that are looking to develop or enhance their training for frontline staff.

“For retailers that don’t have an employee training program within their business, they have to get started on building internally today, and they have to move fast.”

However, he adds that as important as the creation of a training and development regimen is, so, too, is the consistent review and analysis of the needs of the business and employees, as well as the effectiveness of the employee training offered.

“Training and development programs should be constantly evolving. They’ve got to align with the changing needs of the business, the expectations of employees and evolving consumer behaviour, tastes and preferences. If you’re not doing a top to bottom review and analysis of your training programs on an annual basis in the least, it’s like having a binder in the cupboard that nobody looks at. The implementation and execution of training and development programs are important. But the reinforcement strategy is equally critical in keeping the program alive and functioning optimally.”

As the world moves collectively toward a resumption of ‘normal’ activity and people in communities everywhere begin to venture out more in search of experiences, increasing physical retail footfall, it’s clear that the quality of in-store service and interaction is going to be paramount in determining success and failure. As a result, it will be the employees on the retail frontlines who will be responsible for delivering these outcomes, rendering the investment in the training, growth and development of their skills the most important for retailers to make going forward.

How developing a culture of diversity, equity and inclusion can attract and retain top retail talent

How developing a culture of diversity, equity and inclusion can attract and retain top retail talent

We’ve been talking a lot over the past few weeks about what retail workers want, and how retail organizations can overcome The Great Resignation by changing the way they support their staff. Today, we’re exploring how investing in diversity, equity and inclusion can attract and retain top retail talent. 

Getting top retail talent to your organization can prove, during the most certain of times, to be immensely challenging. And, given the importance of staffing stores with the right people for the right roles in order to deliver on the experience customers are expecting, the need for retailers to do so is critical.

To support the objective, retailers must possess a deep understanding of the needs of today’s retail workforce, an appreciation for the things they’re looking for from prospective employers and a willingness to deliver on those needs and wants. And, at the very top of the list is a yearning to be part of a diverse, equitable and inclusive workplace environment.

In fact, according to a recent McKinsey & Company survey, developing and fostering strong diversity, equity and inclusion (DE&I) initiatives within any retail organization is paramount today with respect to attracting talent. The survey reveals that 39% of all respondents stated that they have either turned down or decided not to pursue a job because of a perceived lack of inclusion at an organization. 

But… What exactly is DE&I within the retail context? How does the development of these initiatives help support staffing efforts? And, how can retail businesses take the first steps toward achieving such a culture within their organizations? 

What is diversity, equity and inclusion?

Diversity, equity and inclusion within retail refers to the efforts undertaken by organizations to create a more welcoming workplace environment for prospective employees. According to Anne-Marie Pham, Executive Director at the Canadian Centre for Diversity and Inclusion, these efforts should encompass the entirety of society and take into account the many faces and voices that it’s composed of.

“Retailers that are looking to develop strategies and initiatives aimed at creating a more comfortable and inviting environment for their employees need to consider every dimension of diversity,” says Pham. 

“That includes gender, sexual orientation and identification, race, religious and cultural backgrounds, languages spoken, levels of ability and more. And, because we now have the social permission in Canada to talk about diversity, equity and inclusion, driven primarily by global events over the last year-and-a-half, many retail workers across the country, particularly among the younger generations, are seeking employment with brands that are purpose-driven and aligned with their values of respect for all.”

Why should retailers care about diversity?

Fostering diversity and inclusion throughout the retail organization, from head office executive positions all the way down to in-store associates, makes perfect sense from a customer acquisition point-of-view. Those who can properly reflect the ever-expanding social tapestry of Canadian society will almost assuredly generate an eclectic range of foot traffic to their storefronts. And, says Pham, it’s an effective recruitment tool as well.

“In order to function optimally, retail organizations must rely heavily on many individuals from an array of different backgrounds. So, from a talent acquisition and retention perspective, DE&I initiatives provide merchants and brands with an excellent opportunity to create a culture that will appeal to a range of diverse talent, offering them an environment where they want to go to work every day,” says Pham. 

“It’s an environment that should encourage everyone to bring their whole selves to work, including aspects of their background, lived experiences and life circumstances, facilitating and supporting a sense of belonging for everyone.” 

The benefits of diversity, equity and inclusion in retail

In addition to the development of DE&I initiatives fundamentally and ethically being the right thing for retailers and other businesses to undergo, the productivity and related financial benefits that organizations receive as a result are significant. 

According to a recent survey conducted by The Harvard Business Review of 1,700 companies around the world, those operating with an above-average level of diversity within their organizations experience 19% greater innovation revenues and 9% higher earnings before taxes. And, in Pham’s estimation, it’s all the result of a more engaged and inspired workforce.

“If a welcoming and comfortable environment is developed, one that makes employees feel included and respected, a level of trust and loyalty to the employer will become a natural consequence,” she says. 

“In turn, their trust results in higher levels of engagement, which then leads to greater collaboration and productivity, bringing out the most thoughtful and innovative ideas, enabling any retailer or brand to be much more responsive to the needs of an ever-changing market.”

For a real-world example of the benefits that can result from DE&I initiatives and the development of a truly inclusive work culture, one needn’t look any further than global retail giant Walmart. According to Statista, the company posted worldwide sales in excess of $711 billion in 2021, up from $666 billion in 2020 and $654 billion in 2019. They are earnings that are reflective of the significant year-over-year increases in revenue experienced by the multinational corporation. And, according to comments made during an interview with Winsight Grocery Business by former Walmart DE&I Director, Donald Fan, they are financial results that are made possible by the company’s culture of diversity.

“By embedding equity into the talent lifecycle, you enrich your employees’ experience; thus, you accelerate their engagement and productivity and make your team high performing, dynamic, and resilient,” explained fan. 

How to begin building a culture of DE&I

A recent global survey conducted by Mercer found that 74% of participating companies reported to have been placing greater focus and emphasis on diversity, equity and inclusion initiatives midway through the COVID-19 pandemic, with 64% actively reviewing talent management processes, such as hiring, in an effort to identify and mitigate potential biases.

For retailers that are committed to developing a culture of diversity, equity and inclusion, but have yet to formalize their strategy, Pham says that there are a few steps they can take to properly and effectively kickstart the process.

1. Commit to learning

Retailers that are new to the DE&I conversation must be open and willing to learn more about the topic and about the lived experiences of individuals. “Read books about DE&I, watch documentaries and read the news in order to understand and build compassion and empathy concerning the many systemic challenges that many face when accessing equality and inclusion within the workplace. Through this education, leaders will gain a greater sense of humility, compassion, understanding, and a heightened awareness of themselves in relation to others,” she says.

2. Conduct an honest assessment

Retailers will want to conduct an assessment of their organizations, the representation on staff and how internal DE&I initiatives might improve their level of diversity and inclusion. “Listen to the concerns of your employees and customers. This can be done through surveys and one-on-one conversations with team members at different levels of the organization,” says Pham. 

“It can also include the engagement of a third-party expert who can help review current policies and practices. This will allow retailers to understand whether or not there are any real or perceived barriers to employment or equity within the organization, as well as help them to identify any unconscious biases that can negatively influence the ways they do outreach, screen applicants, conduct interviews and make their selection at the end of the day.”

3. Commit to change

In order to put the education and assessment to practical use, retailers should determine what is required of them in order to effect actual change within their organizations. “Influencing this kind of change often requires a shift in mindset and philosophy which always starts at the top,” says Pham. 

“To do so effectively, leaders must determine which resources will be required and whether or not a budget is necessary in order to create the positive impact that they desire. And, everyone must be involved in the shift at the executive level of the organization to lay the foundation and set the direction for others to follow.”

Pham goes on to explain that the creation of a workplace environment that is truly diverse, equitable and inclusive requires a substantial amount of dedication, commitment and hard work. And, she adds, it also requires time to develop plans and initiatives and implement the right policies and procedures to actually change or positively influence the culture of an organization. However, she says that once retailers embark on their DE&I journey toward workplace improvements, the momentum among customers and employees of the brand will accelerate rapidly, resulting in the attraction of a greater number of prospective retail workers, increased engagement among staff, and an enhanced ability to cultivate and retain top talent.