4th January 2017
High street fashion retailer Next’s dismal Christmas trading and outlook for 2017 will send a cold wind through the rest of the British retail sector as we get into 2017. It provides a wake-up call to retail payroll teams to get their act together, in what could be the start deepening uncertainty over the impact of inflation on fragile UK consumer confidence pre-Brexit Article 50.
Smaller retailers have already seen the benefit of outsourcing their payroll and using payroll specialists to provide the critical strategic payroll analysis that will help control payroll costs and transform retailers in a changing retail environment. Some savvy larger retailers have already embedded rock solid payroll software to help with that analysis if they keep things in-house rather than outsourcing.
With demand weakening and retailer costs already set to escalate with changes in the National Living Wage this year, retailers will need to be agile in the way they use staff going forward. Being able to utilise payroll reporting to determine changes in personnel strategy, will ensure staff and pay are tightly controlled.
Retail managers may have a good idea of the hours of labour needed to run a store or business well. But understanding what each staff resource costs can help to determine the level of full, part-time, zero time and apprentices you might take on. Understanding what percentage of a team are on the National Living Wage for example, and the Minimum Wage of those employed under 25 years of age, could help determine the recruitment policy for a business.
7.50 per hour – 25 yrs. old and over
£7.05 per hour – 21-24 yrs. old
£5.60 per hour – 18-20 yrs. old
£4.05 per hour – 16-17 yrs. old
£3.50 for apprentices under 19 or 19 or over who are in the first year of apprenticeship.
Freeing up time for payroll specialists, through outsourcing or use of payroll software in-house, to better interpret and advise on what is the biggest cost to retailers, is a wise move.
So, it’s probably time for managers or directors responsible for retail payroll teams to take stock on how they organise payroll, and get organised this year.
