Each year, U.S. businesses take on thousands of additional workers to withstand increased holiday demand from October to January. Here's how to get ahead of the competition.
The holiday sales surge serves up equal doses of thrill, stress, and reward to business owners and managers. Amid all that excitement, and all those tiring hours, the last thing you want to worry about is not having enough staff to pull it all off. A robust, knowledgeable, and well-trained work fleet will keep your operations steady during the swell, and may also give you a leg up over the competition.
For this reason, taking on additional employees has become necessary among businesses during these early winter months. Last year, in fact, retailers in the U.S hired 453,600 extra workers from October 2009 through January 2010, up from 231,000 during the same stretch the year before.
The National Retail Federation projects a 2.3 percent increase in sales during this year's holiday season, meaning businesses will likely add even more staff to absorb the hike. In preparation, here are a few tips about finding, training, and hiring a successful team during the months to come.
How to Hire Seasonal Employees: Start Early
Especially for businesses with huge fluctuations, preparing a seasonal staff shouldn't take precedence only during the holiday months. The search for competent employees should continue all year round.
"If you're a retailer who's not hiring in September, you're giving your competitors a lead on you," says Daniel Butler, vice president of retail operations at the National Retail Federation. Butler, who worked as a retail manager for 26 years, advises companies to start screening applicants in September to gauge how well the person gels with the team. Doing so also puts you ahead of the curve when it comes to making the necessary marketing, staff, or inventory changes as the months progress. "For the holiday season, you want to be in front and ready for the business when it happens," he says.
The first place you should look to find employees is your part-time staff list, often called a flier or floater list. By drawing from a pool of workers already familiar with your organization, you can be assured that they will catch on quickly with the everyday operations. "We try to anticipate the increase and have a panel of part-time staff that we can draw from," says Jim Kiriwan, owner of Try Sports, an athletic apparel retailer based in South Carolina. "They're pretty experienced and trained and can hit the ground running in the store."
As you begin to flesh out your holiday reserves, you should also look for and cultivate certain traits among the prospective hires. And starting early gives you an early glimpse at who will break the greatest strides during those crucial holiday months. "You're not just looking for warm bodies," Butler says. "You're looking for people that are going to be good with the public, who realize that there's a lot more to it than just standing at the register ringing people up."
Dig Deeper: How to Manage Seasonal Sales Fluctuations
How to Hire Seasonal Employees: What to Look For and Where
It's very possible that your part-time staff simply can't fill all the holes you have in your roster. This once again underscores the reason to start ahead of time: you need to assess the upcoming needs and anticipate where you'll have to make the biggest changes. Butler says to look at areas like your sales plan, your sales from the prior year, and your current coverage to statistically forecast your needs by day and by hour.
Once you create your roadmap, it's time to fill in the blanks. Do you need more sales strength? Maybe you need an extra set of hands in the stock room? Are there specific time slots that require some fleshing out?
Of course it's not enough to fill these positions with any old "warm body," as Butler likes to say; you'll want to assemble the best team possible. When interviewing candidates, look for people who have a willingness to learn, an ability to be flexible with demanding hours and responsibilities, and a genuine interest in using or selling the products. "I always found that schoolteachers were great seasonal hires," Butler says. "They picked up things quickly and they also helped teach other people."
This year, as the recession lingers and unemployment remains high, there should be no shortage of applicants looking for extra work. If you still have trouble finding sure-handed employees, however, consider putting out advertisements or using a temp-staffing agency. Sites like SnagAJob.com, SeasonalJobs.com, and GrooveJob.com are geared specifically towards part-time, hourly, or student positions and allow you to post your openings for free. Or, if you're looking to cast a wider net, trusty job search engines Monster, Simply Hired, and Indeed have full sections for part-time positions as well.
Dig Deeper: How to Forecast Sales in an Uncertain Economy
How to Hire Seasonal Employees: Train Often
For the average small business owner, customer service can and should be one of your greatest distinctions. Along with product expertise and specialty, it's one area where you can outpace big box retailers that make huge price slashes and feature wide varieties.
Kiriwan of Try Sports, a 2010 Inc. 5000 list honoree, says that his company puts a lot of time and energy into having "extraordinary customer service." One of the ways he enhances the customer experience is by putting employees through a rigorous training regimen so they know the products inside and out. For Try Sports, which specializes in fitness equipment like heart rate monitors, this knowledge is crucial. "We train the staff to be very familiar with the product, and they're probably using it themselves," Kiriwan says.
Like product training, sales training is also a critical component of success during the holidays. But don't expect any overnight miracles. "Trying to teach people to sell is always difficult, and especially to sell in the right way," Kiriwan says. He and the managers spend a lot of time coaching the staff to sell the right way, which includes not pushing customers to buy additional products. It may take a little longer with seasonal hires, but you should always aim to get them to buy into your mission and really 'wow' the customers every time they walk in.
"At the end of the day, it's the people that really make the difference in a business: the quality of the staff, the quality of the managers, the quality of the senior management," Kiriwan says. "The biggest reason people don't come back is because they forget."
Dig Deeper: How to Maximize Holiday Sales and Profits
How to Hire Seasonal Employees: Promote Progress
Seasonal employees not only give you an extra boost during the busy season, but they also provide a repository of talent should you have full-time hiring needs in the future. From that standpoint, you can look at the work almost like a two or three month job interview.
"In an ideal world, all of our full-time people would have started as part-timers," says Kiriwan "You're actually making employment decisions based on hard performance data that has been built up over a period of time, not relying on subjective interviewing to make your decisions."
Nearly all of the Try Sports managers have in fact started in lower level, part-time positions, Kiriwan says. Above all else, this can incentivize people to want to join a stable, fast-growing company with opportunity to build a career.
It's also important to identify both tangible and intangible achievements when making full-time employment decisions. Maybe some workers may not have pulled in as much commission as others, but were always helping out around the store. By contrast, maybe some employees only stuck it out for the promise of holiday discounts. For the ones who put in the effort and did stand out, be sure to reward their success by at least letting them know that you'll consider them for full-time work when you expect to have turnover. "Managers always know who pulled their weight and who didn't," Butler says. "For some people, it can be the stepping stone to a new career."
How to Hire Seasonal Employees: Play By the Rules
The last issue to consider when acquiring temporary workers is categorizing their employment status properly. In order to escape extra paperwork, fees, or expenses, make sure to place all your part-timers on the payroll. They aren't independent contractors or even "permatemp" employees, Butler says, so you needn't extend health care benefits in most cases.
To avoid visits from the Department of Labor or IRS, the American Institute of Professional Bookkeepers puts out a free set of guidelines for navigating the rules (available by e-mailing at firstname.lastname@example.org). By failing to withhold taxes, for instance, you can get hit with a 100 percent liability, plus interest and penalties. The report also outlines the rules for hiring minors and family members.
If you do end up extending a full-time offer to a seasonal employee, you would need to re-classify the position so the person can buy into health benefits and other options. Misclassifying workers can lead to legal headaches, as Microsoft found out in 1996 when it doled out $97 million to a group of "permatemp" workers that it incorrectly excluded from its stock purchase plan. You can easily avoid problems like this by setting up a pay structure and quickly running it by your accountant or attorney.