Footwear Insight

footwearinsight.com May/June 2018 ~ Footwear Insight • 33 1 2 3 4 EVEN IF NO EMPLOYEES IN YOUR SHOP ARE DIRECTLY IMPACTED by a minimum wage hike, salaries that once sat comfortably above minimum wage may no longer look so attractive to both current job holders and prospective hires. Dick Johnson, president, chairman and CEO of Foot Locker, flagged the effect of the raises on more senior-level employees as an organizational challenge in an interview with Footwear Insight. "It is the reality, with unemployment be ing fa irly low , tha t y ou're competing in a tighter pool of candidates," he said. "When you get [wage increases] in part-time jobs and the first tier in that market, it forces compression up the local food chain to management ranks." O LYNN BOURQUE, OWNER OF THE RUNNERS SHOP IN TORONTO, says that as an urban store in a high cost-of-living area, most of her small cohort of employees are salaried. And while she has one employee who will need a raise to stay competitive after the second adjustment in the minimum next year, she says the only employee directly affected by the wage hike is her teenage daughter, who helps out occasionally in the store. Where it will most affect her, she says, is in the staffing decisions she makes for race expos and events, when she hires groups of often-teenage staffers to ring up merchandise and work the expo floor. "I need to become better at getting people working for me; as an employer, that's a skill set I need to hone for myself." To Bourque, that means advanced planning to make sure she has useful, productive tasks that employees can tackle during slow moments — and making sure she's clearly communicating what those tasks are and her expectations around them. It also means being more decisive about sending hourly employees home early (once they've met their minimum hours) if they aren't needed. O SHOETOPIA'S MOHR SAYS MAINTAINING HIGH LEVELS OF service means that cuts or changes to staff levels on the floor or in any customer-service positions are out of the question. Instead, he says, he's going to explore software options for outreach and follow-up that require less manual labor and less oversight and will look to automate as many backend processes as possible. He's even considering exploring having some data entry and similar work outsourced to a firm overseas, where, he says, the hourly prices are about half what they are in his region. "We need to outsource and automate and find efficiencies in every place that before we never really looked at before," he says. "You have to open up all of the different things." O Rethink Salaries Upstream Account for the Hidden Costs Get Efficient Think Outside the Box The reality, with unemployment being fairly low, is that you're competing in a tighter pool of candidates. Clearly communicate tasks and expectations to employees to keep them productive. Automate as many backend processes as possible. RETAILERS WHO HAVE RAISED WAGES SAY IT'S NOT JUST THE hourly employee outlay that needs to be accounted for: It's all the costs that go with it. Peter Mohr, president of the Kitchener, ON-based Shoetopia Footwear chain, says that taxes on the higher salaries as well as increased mandated paid vacation and sick time under the new law (sometimes but not always an additional workplace benefit passed in addition to the raise in employee salaries) have had an outsized impact. While many of Mohr's employees across Shoetopia's three suburban stores were making above minimum wage, the provincial rise has led other staff members to ask for raises as well. "Our wage costs have gone through the roof," he says. "It's not just the minimum wage, it's employee taxes. Everything's exponentially larger." O Some salaries have been raised, leading to other staff members to ask for raises as well.

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