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Good Training and Institutional Knowledge are the Meat of a Successful Operation

August 15, 2019

In the previous article, we addressed the difference in “shrink” between profit leaders and the rest of the market.  In this, the third of our four-part series, we will look at employees and labor expenses, and how top performers approach them.

In today’s tight labor environment, retaining and attracting great employees has become an enormous issue.  A CEOs and CFOs must approach the cost of labor strategically. While all expenses should be carefully considered, employees are a store’s customer interface, and ultimately the ones who implement shrink programs.

If you have a high turnover rate and do not retain some key positions and encourage those key people to train their departments, the opportunities to keep customers and reduce shrink drops. Long-term employees typically receive higher compensations, because they have a better understanding of the business, which results in more productivity.

When I started working in a grocery store as a meat cutter, I learned two important things during my initial week on the job. First, when cutting lamb chops, you should cut the chops straight thru on the saw.  What I did not know was the meat would green before its shelf life was due.

The meat manager once asked me if I was trying to kill his margins.  I looked at him like most college kids: like a deer in headlights.  He explained, that if you cut the main bone at the top with the saw and cut the small soft bone inside the chop with a knife, the meat would keep its purplish lamb color.  The next day, I was out marking down my original cuts as they had started to “green.”

You are as good as the person who trained you. When I had to fill in at another store for a vacation, I showed another employee the same trick my boss taught me.

In many companies, there is no training guide to explain basic processes in each department. In a web-enabled world, a simple YouTube video or a “homemade” film on a smartphone could help document and share knowledge across your staff.

The second lesson learned was on temperature. After producing each type of cut, the next step was to weigh and wrap it, and transfer it to the cooler before moving on to the next cut or variety of meat.

One night we didn’t have a person to do the weighing and wrapping, so I cut all of the meat at once, and then ended up doing all the measuring and wrapping afterwards in the same room I had been cutting.  More efficient, right?  Maybe, but the temperature in the cutting room was higher than the back coolers where the meat was put on racks.

The result? The meat browned more quickly because I had cut everything before wrapping rather than doing so after each type of cut and putting it into an area with proper temperature.

The next day, my supervisor wasn’t thrilled. Once again, he thought there was a vendetta to kill the store margins.  He must have done the same job his entire life, as he knew the point of failure, without even being in the store.

These missteps may seem obvious, but if an employee leaves, the next one may be as green as the lamb chops, I cut.

Take the time to train your employees, encourage them to train others, and retain those that have both the knowledge and the skills to teach.

In the long run, the person with experience and the ability to teach outweighs the most productive solo performer, because share knowledge will multiply your efficiency.

About FMS Solutions: Helping retailers succeed by transforming historic accounting activities into timely, accurate decision support tools.