Learning curve

While the retail industry is clearly booming in the Middle East, there are also signs that some important aspects of the sector, such as staff training and recruitment, are struggling to keep up. And with Dubai's retail space alone set to reach a phenomenal 4.25 million sq m by 2010, the situation is likely to get worse.

Indeed, a lack of basic training among shop floor staff and managers is already causing lost sales in the region, according to one UK-based retail training specialist. Jason Kemp, director, Envision Retail, reckons that one of the main problems for retailers - in the UAE at least - is how to ensure shop floor staff understand how to interact with customers from such diverse ethnic backgrounds. Consumers from different countries tend to have different expectations of how they should be treated by shop staff, and if the experience fails to meet their expectations, it can easily lead to lost sales, according to Kemp. And according to research undertaken by Envision Retail in Dubai recently, retailers should be worried. The research indicates there are serious problems in the way shop floor staff interact with customers in Dubai. While such interactions have been shown to make a sale more likely in retail outlets in most countries, Dubai has proved an anomaly in Kemp's research: in Dubai, interactions between staff and customers appear to make a sale less likely.

While Envision Retail's research shows that some of these lost sales are a result of shop staff telling the customer that an item is out of stock, it also revealed that there is a problem with the way shop staff relate to customers. More particularly, they appeared to struggle to identify customers' ethnicity and adapting the service accordingly.

"Firstly there is the cultural difference between the staff and the customer," Kemp says. "Second there is a quality of interaction issue and some of it comes from this cultural difference, but I think some of it comes from the fact that they aren't able to identify the different customers roots - for example whether they are Gulf Arab, an expatriate or a tourist. The different groups have different expectations.

"You will have customers entering your store with hugely varying expectations. The quality of interaction is much higher in the luxury stores, but the expectation of that interaction is also much higher," he adds. "Where there is an expectation gap, you're going to lose sales."

Another problem that Envision Retail's research discovered is that staff are failing to pay enough attention to all customers, and often put other tasks, such as stock taking or cleaning, before customers. "Staff are very good at focusing on tasks and don't see that serving customers is a task and it becomes almost like a distraction," Kemp says.

This problem is caused partly by poor staffing levels as well as inadequate training, according to Kemp. "There are a lot of occasions where I will go into a store and there is a huge amount of staff standing around and not enough tasks to keep them busy," he says. "Other times there will be huge amounts of customers around and the staff are all busy doing tasks. I know it's very difficult to fluctuate the level of staffing but it doesn't mean you can't move tasks around to smooth that workflow out throughout the day." By doing this, Kemp says retailers can avoid reaching the point where staff are under utilised, leading them to become de-motivated.

"It is vital for retailers to understand basic customer needs and to charge staff with the right amount of tasks throughout the day," Kemp says. "You have got to keep people occupied. I also mean people manning the till and being available for service, that needs to be seen as an important job."

Retailers can combat these problems by ensuring staff have an even flow of work through the day and by educating them about different types of customers and their varying needs. Kemp said Envision Retail has also developed a training tool for retailers which allows staff to watch footage of customers shopping and interacting with staff members. The footage shows where interactions have either succeeded or failed, and this can be used as a basis for discussion with the staff being trained.

Back to school

The problem of inadequate training is not only evident in Dubai's retail outlets. For Wael Al-Hawari, executive manager of Saudi Arabia-based retail consultancy Evision KSA, a lack of training - and a lack of training standards - is also a headache for retailers in Saudi Arabia. Al-Hawari says the major problem is that there is no retail training school in the Middle East, and also no set training courses or certification for retail staff.

"Until now, we don't have any retail academy. There are no certifications for senior retail positions such as a diploma in retail management," Al-Hawari says. "We don't have a problem in the Middle East with a staff shortage, we have a problem with the short experience. There is no special training centre focusing on retail or specialising in retail. You will find general training centres that talk about management, but nothing for retail in the GCC countries."

To fill this gap, the region needs a specialist training centre for retailers that provides training to set standards, Al-Hawari says. At the moment, different retail groups in the region tend to have their own in house training packages, which means staff who already have experience in the sector will often be re-trained when they start work at a new company. The standards of training are likely to vary in quality, and it may often be unnecessary to make new recruits go through the training programme.

"Each retailer has his own training manual, so each one designs his own training manual according to his needs. There is no standard on that training. That is why you find when retail staff change jobs, they have to be trained again. I think it is time to provide this type of service for the retailer in the GCC countries," Al-Hawari says.

To this end, Al-Hawari is working towards the establishment of a dedicated training course and training centre for retailers. He said that his company is already conducting research to create a retail training manual that will be similar to those used in other countries, such as the UK. Furthermore, he said that feedback about the idea from the industry has also been positive.

A lack of training among shop floor staff, and a lack of accredited schemes to help train them, is feeding into a wider regional problem: a shortage of skilled workers for the retail industry. Kevin Edmonds, managing director of R3, a retail recruitment company with offices in the UK and Dubai, said a lack of skilled retail managers is a major issue in the Middle East. Some retail brands are nervous about setting up in the region because they are worried about whether they will be able to find the right people, Edmonds says.

The skills shortage is so acute that many retailers are resorting to over-promoting existing members of staff, as well as poaching managers from overseas. "Because the region is growing at such a great rate the demand is outstripping supply massively and so there really isn't the quantity or quality of people in the local area, so the companies have to look further a field," he says.

Furthermore, this problem is linked to a lack of training for shop floor staff. Indeed, in more developed markets such as Europe and the US, many retail managers started out as shop floor workers and progressed up the career ladder. In the Middle East, this is unlikely to happen, as there is an assumption by many retailers that their shop floor workers are unsuitable for management training.

"There is a big mind set gap in the Middle East that says people who work at shop floor level aren't able to progress," Edmonds says. "Now that doesn't happen in any other market. In the UK, many managers for companies such as Tesco started off working on the shop floor and they progressed their way through the organisation. That doesn't happen in the Middle East...retailers either don't have the confidence in the people or they don't provide them with the ongoing training." However, Edmonds thinks this situation will change in coming years. "It has to change because otherwise there is going to be this ever-increasing pressure to find people and there is no organic growth in companies at the moment."

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