The success of your business is dependent upon your clear management direction and the determined efforts of the people who work for you. For your business to succeed, it’s critical that you employ enough qualified staff to deliver the service your customers expect.
Unfortunately, there may be times when you find yourself struggling to hire enough staff to meet the demands of the business. This could be, because; you don’t have the time to recruit people, you are finding it difficult to find qualified workers or cashflow is preventing you from taking on extra staff.Your business may be able to operate efficiently for a short time with a limited number of employees. In the longer-term, understaffing will demoralise your staff, slowly kill your business growth and even the core business. These effects could include:
Loss of sales and store profitability
Research shows there is direct impact on sales revenue when your store or restaurant is understaffed. There will be a higher transaction rate when you have optimal level of staff in your retail business. In the restaurant trade, it is nearly impossible to hide the effects of understaffing from your customers. If you don’t have enough front of house staff or waiting staff, it will be difficult to keep on top of the essential operation like taking orders, clearing plates and checking if customers are happy with their meal.Damage your brand and bad reviews online
It can take years for your business to build up a good reputation but it only takes one disastrous bad review to destroy the brand image you have built. This reputation can easily be destroyed in mere moments if your customers do not receive the level of customer service they usually expect. If your business is struggling to deliver good services, it could develop a reputation for having poor customers service very soon. Good reviews go a long way and even contributed to £2 billion spending in the UK a year. On the flip side, nothing is more damaging than a disgruntled customer tweeting the lack of service of your pub online or even worse, leaving bad reviews on review sites such as Tripadvisor, Yelp, etc.. It’s estimated that bad reviews online could cost a business £30,000 a year. Customers who did not receive proper service might switch to competitors resulting in a loss of business.
Loss of productivity and high turnover
If your business is understaffed, you could unintentionally put pressure on your staff and to work longer hours. At first, your staff may be happy to do this particularly if they are paid by the hour. By working extra shifts or longer hours they will end up with more money in their payslip at the end of the week or month. However, if they continue to work longer hours, over time, your staff could become worn out and may even start to suffer from stress. Stress is a major contributor to ill-health. Stress can cause people to become irritable, have headaches, suffer from dizzy specials and in some cases, it can lead to people developing depression. Some may sort to use alcohol and even drugs and lead to substance abuse issues. All these staff problems would lead to a loss in productivity and cause high turnover, which i return, costing your business more to hire new staff.
An increased risk of staff injuries
The risk of injury is higher when staff members are overworked and tired. They are then prone to losing their concentration and the risk of them being involved in an accident increases. This can be particularly dangerous if your employees are working with machinery or heavy/sharp objects. For example, if you run a restaurant, your staff could end up cutting themselves whilst preparing food in the kitchen, or they could spill hot food or drinks on themselves or others whilst serving. Nobody wants to see an accident happen in their business. If it does happen, it is very important that you adhere and follow the correct health and safety procedure.
Higher cost in recruitment
People want to work for companies that look after their staff. If your business develops a reputation for being a ‘bad’ place to work, you may find it difficult to attract new talents to join your company. A business that develops a problem with understaffing can easily become stuck in a vicious recruitment cycle: the business initially struggles to attract staff – the existing staff become overworked and stressed – the staff either leave or they complain to others that it is not a good place to work – this puts people off from working with you. If you want your business to prosper and grow and ensure your staff stay productive, healthy and happy, you need to invest time in hiring enough number of qualified staff. The perfect solution could be to hire temp staff to provide cover or an extra pair of hands when you need it.