Want to attract and retain top retail talent? Prioritize DEI.

At Axonify, we understand the needs of today’s retail workforce. One important piece of the puzzle is how retailers can invest in diversity, equity and inclusion (DEI) to overcome labor shortages by attracting and retaining a broader network of top talent.

In the retail industry, finding, hiring and keeping quality associates and managers is always a challenge—even at the most certain of times. But it’s critically important: providing an excellent customer experience hinges on having the right people in the right roles, so effective staffing practices are a top priority.

To achieve staffing goals, retailers need to understand what today’s associates and managers value in their prospective employers and have a willingness to deliver on those desires. Job seekers are increasingly prioritizing companies that demonstrate a strong commitment to DEI. A McKinsey survey found that 39% of respondents have rejected job opportunities due to a perceived lack of inclusion at an organization. 

So what exactly does DEI look like in a retail context? And how does the development of an inclusive culture impact staffing specifically? 

What is diversity, equity, and inclusion (DEI) in retail?

Diversity, equity and inclusion in retail encompasses a company’s efforts to create a more welcoming environment for all potential and existing employees. Anne-Marie Pham, Executive Director of the Canadian Centre for Diversity and Inclusion, emphasizes that these efforts should reflect the full spectrum of society.

“That includes gender, sexual orientation and identification, race, religious and cultural backgrounds, languages spoken, levels of ability and more.”

Pham points out that candidates often prioritize working with employers that demonstrate a strong commitment to DEI. “And, because we now have the social permission in Canada to talk about diversity, equity and inclusion, driven primarily by global events, many retail workers across the country, particularly among the younger generations, are seeking employment with brands that are purpose-driven and aligned with their values of respect for all.”

Also read: What retail workers want: Employee engagement secrets from a retail staffing expert

Why should retailers care about diversity?

Fostering diversity and inclusion throughout the retail organization—from head office executives to in-store associates—makes perfect sense from a customer acquisition point of view. Companies that reflect the diversity of the societies in which they operate are likely to generate a similar diversity in foot traffic to their storefronts. And, says Pham, it’s an effective recruitment tool as well.

“In order to function optimally, retail organizations must rely heavily on many individuals from an array of different backgrounds. So, from a talent acquisition and retention perspective, DEI initiatives provide merchants and brands with an excellent opportunity to create a culture that will appeal to a range of diverse talent, offering them an environment where they want to go to work every day,” says Pham. 

“It’s an environment that should encourage everyone to bring their whole selves to work, including aspects of their background, lived experiences and life circumstances, facilitating and supporting a sense of belonging for everyone.” 

The benefits of diversity, equity and inclusion in retail

In addition to being the right thing to do, DEI efforts directly impact financial performance. A recent Harvard Business Review study found that every 0.1-point improvement in a company’s DEI ratings led to a 13% increase in change power—a measure of a company’s ability to adapt and grow—which is linked to up to 3X revenue growth. In retail, doing DEI well not only boosts innovation but also drives measurable business outcomes.

And, in Pham’s estimation, it’s all the result of a more engaged and inspired workforce.

“In turn, their trust results in higher levels of engagement, which then leads to greater collaboration and productivity, bringing out the most thoughtful and innovative ideas, enabling any retailer or brand to be much more responsive to the needs of an ever-changing market.”

Consider this real-world example of the business benefits that can result from DEI and the development of an inclusive work culture from global retail giant Walmart. 

According to Statista, the company posted worldwide sales in excess of $711 billion in 2021, up from $666 billion in 2020 and $654 billion in 2019. These earnings are reflective of significant year-over-year revenue increases experienced by the multinational corporation. And, according to comments made during an interview with Winsight Grocery Business by Walmart’s former DEI Director, Donald Fan, these financial results are made possible by the company’s culture of diversity.

“By embedding equity into the talent lifecycle, you enrich your employees’ experience; thus, you accelerate their engagement and productivity and make your team high-performing, dynamic, and resilient,” explained Fan.

3 steps to start building a culture of DE&I

For retailers that are committed to developing a culture of diversity, equity and inclusion, but have yet to formalize their strategy, Pham says there are a few steps they can take to properly and effectively kickstart the process.

1. Commit to learning

Retailers who are new to the DEI conversation must be open and willing to learn more about the topic and about the lived experiences of individuals. 

“Read books about DEI, watch documentaries and read the news in order to understand and build compassion and empathy concerning the many systemic challenges that many face when accessing equality and inclusion within the workplace.”

“Through this education, leaders will gain a greater sense of humility, compassion, understanding and a heightened awareness of themselves in relation to others,” she says.

2. Conduct an honest assessment

Retailers will want to audit their organizations, including the representation of staff and how internal DEI initiatives might improve their level of diversity and inclusion. 

“Listen to the concerns of your employees and customers. This can be done through surveys and one-on-one conversations with team members at different levels of the organization,” says Pham. 

“It can also include the engagement of a third-party expert who can help review current policies and practices. This will allow retailers to understand whether or not there are any real or perceived barriers to employment or equity within the organization, as well as help them to identify any unconscious biases that can negatively influence the ways they do outreach, screen applicants, conduct interviews and make their selection at the end of the day.”

3. Commit to change

To put education and assessment to practical use, retailers should determine what is required of them to create actual change within their organizations. 

“Influencing this kind of change often requires a shift in mindset and philosophy which always starts at the top,” says Pham. 

“To do so effectively, leaders must determine which resources will be required and whether or not a budget is necessary in order to create the positive impact that they desire. And, everyone must be involved in the shift at the executive level of the organization to lay the foundation and set the direction for others to follow.”

Pham goes on to explain that the creation of a workplace environment that is truly diverse, equitable and inclusive requires a substantial amount of dedication, commitment and hard work. And, she adds, it also requires time to develop plans and initiatives and implement the right policies and procedures to positively influence the culture of an organization. 

However, she says that once retailers embark on the DEI journey toward workplace improvements, the momentum among customers and associates of the brand will accelerate rapidly, resulting in the attraction of a greater number of prospective retail workers, increased engagement among staff and an enhanced ability to cultivate and retain top talent.