Operating a retail business is a daunting task that requires a resilient character. To ensure steady profitability, owners must skillfully navigate various factors, including selecting competent personnel, procuring suitable products in a timely manner, and adhering to an extensive list of regulations.
However, the most significant challenge may be beyond the scope of store owners’ control: the unreliability of employees who either arrive late or, at times, fail to show up at all.
The impact of poor punctuality
Research from Harvard Business School explores what impact poor timekeeping has on a business. After studying timesheet records of over 25 million employee shifts at a large US grocery chain over four years, the researchers discovered that even a slight increase in tardiness and absenteeism, such as 1 percent, is associated with a considerable 2.3 percent decrease in daily sales, taking into account numerous variables.
Moreover, the study indicated that employee lateness and absenteeism could spread like a contagion, adding to the burden of colleagues who must pick up the slack. These findings are especially relevant to retailers, particularly if the economy slows down and employers once again gain an advantage in hiring, following a wave of resignations, both quietly and openly, due to pandemic fatigue.
“The heart of what we found is that the [quality of work] depends on how much it’s accompanied by other employees being late or absent,” the researchers explain. “You still have 100 minutes of labor, but it won’t be as productive. In addition, employee lateness or absenteeism can have spillover effects.”
Tracking time
The researchers arrived at their conclusions by analyzing timesheet records alongside other data points, such as daily store sales, scheduling practices, store traffic, and weather patterns.
Through their analysis, the researchers developed a statistical overview that displayed the chain reactions that arise from employee tardiness and absenteeism in stores. The sample used for their research covered over 100,000 employees, 500-plus stores, and more than 25 million shift timecards over four years, revealing the following information:
- 9.6 percent of shifts were associated with a tardy employee, who was an average of 21 minutes late.
11.6 percent of shifts were marked absent, with morning shifts between 6 a.m. and noon being the most frequently missed. - Part-time employees had the most difficulties arriving on time.
- One employee’s tardiness or absence can increase the likelihood of their coworkers working longer.
- Furthermore, the study found that tardiness and absenteeism are linked to reduced order sizes, with a 1 percent increase in tardiness leading to a 1 percent reduction in sales per transaction. This phenomenon could be caused by longer lines or difficulty finding a store employee to assist customers.
According to the study, there were significant increases in absenteeism observed in all three periods, indicating that these were not isolated incidents. Therefore, retailers should prioritize understanding the causes and effects of lateness and absenteeism.
To address these issues, the authors recommend that managers improve their training and scheduling practices. This can reduce the likelihood of unexpected events and provide employees with a clearer understanding of what is expected of them.
