Sales & Marketing Retail news from the shop floor by Nicole Wong Retailers can't stand still if they want consumers to keep spending Benefiting from the economic turnaround, local retail businesses have taken full advantage of improved consumer sentiment and have seen double-digit growth in sales figures over the last year. At the same time, though, they have been faced by a series of new challenges and, in particular, have recognised that greater efforts must be put into the recruitment and training of sales professionals who are essential to the business. According to Bankee Kwan, chairman of the Hong Kong Retail Management Association (HKRMA), the retail sector is expected to experience steady growth in 2005 and 2006, as employment and salary levels continue to rise. However, the improving economy will also create new pressures. "The increase in rents is offsetting gross profit margins for most retailers," Mr Kwan says. "They cannot just raise prices and pass part of the increased cost of doing business on to the customer. Rising interest rates may also lead to inflation, which could have a negative impact on local consumption." These factors are bringing significant change and making it necessary for retailers to react quickly. Mr Kwan explains that one way to reduce costs is by adopting more effective supply chain management. From manufacturing and warehousing right through to distribution and in-store delivery, retailers must have tight control of the entire logistics process. "Most companies make their profits by selling at low prices and achieving high volume," Mr Kwan adds. "For this, they must have quality products and service, as well as good management practices and long-term strategies." Tougher competition Also, the competition for employees with retail experience has intensified with the opening of Disneyland and the expansion of the entertainment industry in Macau. Demand for good frontline staff now outstrips supply, forcing many retailers to make substantial investments in training programmes for new recruits. The courses generally focus on excellence in customer service which is seen as the key to the sales process in today's retail business. "It is the leading market trend and the government is also working hard to promote it," Mr Kwan says. Linked to this is the need for retail sales professionals to keep improving their product knowledge, as well as their interpersonal and language skills. Both frontline and office staff should also have solid computer skills and a fair understanding of supply chain management, since they have to monitor and update product status and check delivery arrangements via the computer system. "The role of retail salespeople has changed substantially in recent years and they now have more management responsibilities," Mr Kwan explains. "They require more detailed product knowledge and must cooperate closely with the back-office team." With the increasing emphasis on quality, the HKRMA plays an active role in enhancing professionalism in the sector with various training initiatives. They run regular seminars on market trends and arrange workshops on key topics such as customer service, brand building and merchandising. The HKRMA also organises visits to established retail companies overseas, during which local retailers can gain a broader perspective on the overall industry. Individual markets While the influx of mainland tourists is undoubtedly giving a welcome boost to the retail sector in Hong Kong, Mr Kwan notes that local retailers will have to fine-tune their strategies and develop new skills to penetrate the China market successfully. "The demand and buying patterns vary between cities in China," he says. "From customer service and branding to IT support and financing, companies from Hong Kong will have to make adjustments and learn about consumer behaviour in different mainland markets." With steady expansion predicted, the outlook for the sales and marketing profession is generally optimistic. As Mr Kwan points out, most retail companies have well-structured career paths and mechanisms for promotion. These are usually performance-related and based on sales figures and customer appraisals, and offer the chance for dedicated junior staff to work their way up to management positions. In a wider context, there are also opportunities for those with all-round knowledge and skills in retail sales to consider openings with mainland companies which are increasingly looking to hire experienced retail managers and marketing professionals from Hong Kong. Since many entry-level positions in retail sales do not require specific professional or academic qualifications, there are now numerous opportunities for young people keen to break into the sector. They should expect constant interaction with customers and, if things go well, will be part of a highly rewarding profession in a dynamic and challenging environment. A genuine interest in sales and customer service is a prerequisite for anyone who wants to get ahead, while a proactive character and cheerful personality help people stand out and are often the basis for a successful long-term career. Resilience is another essential attribute, since the hours worked can be relatively long. "There are new challenges in retail sales everyday, but those who stay enthusiastic about their work will certainly have promising prospects," Mr Kwan concludes. Selling well A stronger local economy has boosted the retail sector in the last year Retailers now face the challenge of higher rents and rising interest rates Sales professionals with retail experience are much in demand Employers are paying more attention to sales training programmes and standards of customer service Salespeople need interpersonal and language skills plus computer knowledge Senior staff may find opportunities in mainland cities but will need to learn about the local market Taken from Career Times 9 September 2005 Your comments are welcome at [email protected]