The Compensation Equation

How do you compensate your bridal store employees? And, more importantly, how should you compensate them? As it turns out, the answer to that question is more complex than one might imagine.
    Bridal retailers – like many a small, independent business owner – like to keep things close to the vest. Some believe  it’s not really anyone else’s business exactly how and how much they are paying their staffs and they definitely don’t want their competitors to know their systems.
    That said, others are more willing to talk – and they admit there are many things that affect how much they pay, when they pay and what other perks they may offer employees beyond the traditional paycheck.
    One advantage of owning or managing a small business is that you have more freedom regarding compensation than the big guys; you can tailor a program that works for the size of your store and the composition of your staff. Add in factors such as seasonality, the capacity to mix full and part-time employees, and atypical retail hours, and it means creative ways to pay and reward employees are almost a given in this industry.

The Pros and Cons
Of Different Systems
    At first blush, employee compensation sounds like a pretty cut-and-dry proposition: You set up a system and it runs along merrily – until it doesn’t.
    One of the most common themes VOWS hears from retailers regarding this issue is that compensation systems have evolved over time. It’s common for a bridal salon to use one method of compensation for a period of time, and then something changes – perhaps the number of staff, perhaps the job duties or perhaps the store dynamic. And all of the sudden that system has to be rethought.
    An informal survey of retailers revealed an olio of payment options from strictly hourly to a complex base/salary/commission/bonus system. Retailers also have a mix of pay methods to take care of employees who are on a management level, part-time or seasonal workers, and specialists like seamstresses.
    Earning an hourly wage for a consistent, predictable number of hours each week does work for many employees. The drawback to that is with a guaranteed paycheck, consultants can get stuck in a rut and begin coasting along rather than perform at peak levels. In other words, they need some kind of added motivation to perform at their best, week in and week out.
    On the other hand, some retailers admit they find commission-based compensation difficult because it can, and often does, create a hostile, ultra-competitive work environment. Others say that commission works well if there is an hourly, salary or “base” pay in place, with commission added as a supplement. In these cases, it’s important to establish an equitable system for assigning bridal appointments to consultants or handling walk-ins. One of the most common solutions seems to be using an “up” system where consultants take appointments on a rotating basis. In a shop with a fairly large staff, this seems like a practical way to manage consultant assignments.
    But as with any system, there is always the occasional glitch. By luck of the draw, some consultants get to work with brides who made larger ticket purchases. In addition, closing rates can and do vary and there is always the temptation to assign stronger performers to particular shoppers. Another issue: what happens when one consultant begins the sale and another writes the order, or two consultants work with a bride? Do they split the commission? When commissions are posted and paid – weekly, bi-weekly, monthly – also varies by individual store policy.
    The bottom line: no system is perfect and retailers who pay on a commission basis are constantly tweaking their store’s scheme.
    Bonuses are another way to offer performance-based compensation, even if your staff doesn’t work on commission. Bonuses can be attached to meeting periodic sales goals, whether individual, as a department or as a store. When and how bonuses are paid out also seems to run the gamut from every pay period to the end of the year, after the store’s year revenue is calculated. Some stores offer spiffs for selling a particular dress or accessory or have contests throughout the year.  

Extra Perks: You Don’t
Have to Write a Check
    Yes, people want a paycheck that’s reliable and enough to pay the bills. But it’s often something else that keeps employees working for a particular salon, espousing a particular brand and culture. There is more to job satisfaction than those numbers on the pay stub. It comes down each individual employee: Why did he or she seek this job? What does he or she want out of it?
    On the plus side, there is the work environment. A bridal shop can be a wonderful, happy, fun place in which to work. Being surrounded every day with racks and cupboards of beautiful wedding gowns as well as the latest in formal and informal fashion certainly is better for the soul than an office cubicle. Most of your clients are excited about the experience and a bridal employee gets to share in that, several times a day.
    Additionally, a little bit of praise can go a long way.
    “You don’t always have to spend a lot of money to compensate your employees well; give them compliments, kudos, praise on a regular basis,” says Karen D. Walker, president of Oneteam Inc., a leadership consultancy focusing on organizational growth. “Essentially, money is great but, employees also need to get some intangible compensation such as public and private commendation for doing a great job or going above and beyond to handle a difficult situation.”
    What are some of the extra perks you can provide?

•    Employee discounts. Stores approach this perquisite with some caution, of course. While it doesn’t happen frequently, applicants occasionally apply for a consultant job at a bridal salon just to be able to save on the wedding gown. The same applies for family-and-friends discounts. There definitely have to be limits; one option is to impose a length of service clause or probationary period before any discounts kick in. As well, usually there are restrictions on discounting imposed by vendors.

•    Tickets and gift cards. Employers have passed along tickets to sporting events, museums and concerts, as well as given gift certificates for mani/pedis, massage or spa days, restaurant and café meals, upscale coffee, wine tastings and beer samplings, movie tickets and even grocery stores. Employees seldom, if ever, will turn down cash or a loaded gift card.

•    Feed the team. Providing a meal for your staff after the store closes or having food available during the day not only helps morale, it tells the team they are appreciated. Another option is to have a “canteen” on site. This can be as simple as a fridge and microwave in the break room. Stocking soft drinks, juices and waters, with or without a monthly “canteen fee”, is a great way to pamper staff during busy days on the sales floor. Take suggestions of what they’d like to have on hand and mix in some special items for holidays, for example. Eggnog or hot cider during the winter or cold beverages in summer are fun perks at work.

•    Flexible schedule. An intangible bonus for a hard-working staff is the potential to be awarded flexible work days. Yes working Saturdays is a given for most bridal retail employees, and a presence in the store is almost certainly required. But the chance to earn a schedule that includes the occasional weekend off is something almost anyone would appreciate. How this reward is determined obviously would depend on the shop, of course.

Cashing In on
Skills and Talent
    In the past, VOWS has discussed optimum utilization of staff resources. Basically this means using the natural talents of the people you employ and not squandering any opportunities to capitalize on their skills. But how does this factor into compensation?
    It’s the responsibility of a business owner to foster aspiration and a strong work ethic in each employee, and to instill the fact that teamwork isn’t a pipe dream but a practical, logical way of running a business. In other words, you can’t do it all and you can’t do it all by yourself; everyone on the payroll has to have a real stake in your store’s success. Platitudes aside, the commitment and performance of your employees can mean the difference between growing and prospering and falling into a tailspin and closing your doors.
    Compensation also can take the form of the opportunity to advance or add something to their job description or career resume. No matter how interesting the job – and there’s hardly a truly dull moment in bridal retail - it’s always great to learn something new or receive a fancy new title. One of the benefits of working for a small business is the opportunity to view how the whole business works.
    Another perk you can offer is continuing education. In addition to the training required as a new hire, employees also gain skills and confidence from education offered both on the job and outside of the store. Sometimes the perk is flexible scheduling that allows employees to take classes, seminars or workshops outside of the store, outside of their work week. Another potential perk is access to an in-house library of training materials, whether in print or video, so that employees can take a refresher course whenever their schedule allows.
    You can also consider taking staff to market or trade shows. This should be viewed as a reward and not just part of the job. Market can be exciting and interesting and give the employee a look at the bigger picture up close and personal. As the owner or manager, you also benefit from extra hands and eyes. Seeing fashion shows in person will give your employees a better look at lines and dress options, which will help them sell.
    In this day and age, there are many people who bemoan the practice of presenting every child in a competition with a trophy for “participation.” In these cases, kids get a prize for just showing up, putting on the uniform and taking the field. Or they are rewarded for standing in front of a room and attempting to spell a word few of us have ever heard of and will likely never use in everyday conversation. These people are upset because they feel this practice diminishes the importance of being a winner in a child’s eyes. They argue that is vital for there to be winners and losers from an early age. After all, in the real world, not everyone gets the grand prize, and most people don’t even get a lovely parting gift.
    What does this mean in terms of your bridal business? Simply put: If your employees want a good paycheck, they can’t just coast. Rather they must work hard, put in the hours, and not expect constant praise for just showing up. And as the business owner, it is your job to foster a culture that encourages people to strive to be their best. You do this by offering appropriate rewards and compensation that fairly addresses someone’s efforts. What this system is can vary depending on the store, and will almost certainly need to be modified with time. Finally, successful business leaders know that praise is important as well; it should come along with every paycheck. In the complicated compensation world, positive reinforcement doesn’t cost anything. And it can mean a lot.   

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