What Is Retail Management? Responsibilities & Skills To Have

Retail management refers to the different processes that help customers get their desired products. Learn everything a retail manager needs to know in this article.

Have you ever been to a store that’s just utter chaos?

Frazzled staff running around like headless chickens. Managers are nowhere to be seen. Messy merch displays and items lying around where they shouldn't be.

You might eventually find what you came in for, but you won't be desperate to return any time soon.

If you're responsible for running a retail store—or if you're thinking about starting a retail business—then retail management is a must-have skill. It's a toolkit of abilities that combines people management, process-building, and an eye for detail to prevent your store from descending into anarchy.

A skilled retail manager can make the difference between a store that just survives and one that thrives. If you want to run a place that makes a healthy profit and that customers can't wait to come back to, it's time to up your retail management game. Here's what you need to know.

What is retail management?

Retail management refers to the process of helping customers find products in your store. It includes everything from increasing your customer pool to how products are presented, and how you fulfill a customer's needs. 

A good store manager helps customers leave the store with a smile. They also are responsible for:

• Motivating employees
• Developing strategies to increase the customer pool
• Growing store traffic
• Meeting sales goals
• Ensuring customer satisfaction
• Improving profitability 
• Preventing shoplifting 

The importance of retail management

The retail landscape is competitive, and new stores are popping up fast. To succeed in this environment, you need to give customers exactly what they want fast and provide a great shopping experience. That’s where retail management comes in. 

Improve the customer experience

An outstanding customer experience is critical for business. It leaves people feeling appreciated and heard. Customers often buy more, act more loyal, and tell their friends about a great experience in your store. 

Great experiences boil down to a few things:

• Speed
• Convenience
• Consistency
• Friendliness 
• Human touch

Retail managers are responsible for giving employees what they need to create outstanding customer experiences based on the elements above. 

Say, for example, a customer named Andrew comes into your store to buy a pair of shoes. He was browsing options at a few different stores and landed in yours. When he asked for the shoes, an employee quickly found the right size and model, and brought them to him. Andrew can enjoy shopping at stores that provide an experience like that.

Optimize store processes

Like every other business around, a successful retail store runs on multiple processes. Retail management involves creating an effective operation that benefits both the customer and your company. Managers must keep records of all products coming into the store, assign SKUs to each product, plan the store layout, and much more. 

Processes store managers are responsible for include:

• Internal planning. The “behind the scenes” of a retail store. Managers must consider staffing needs, supplier logistics, finances, and keeping a tab on competitors. 
• Procurement. Finding the right suppliers for the store at the right price.
• Fulfillment. How products move through the supply chain, from accepting shipments to the packaging and checkout experience in-store.
• Promotions and sales. Managers also make the store look presentable and on brand, as well as promote any specials currently running. 
• Service and support. Customers must be able to navigate the store, find all the product information they need, and have questions answered immediately. 

Retail management saves time and guarantees that customers can easily find their products in-store. A smooth process in place avoids chaos and keeps employees and customers satisfied. 

Support brand growth 

The combination of the above means your business will be more successful, which opens a lot of doors for your brand's future. A more efficient store will be more profitable, and those profits can be reinvested to grow your brand. 

Growth may look like:

• Making store improvements 
• Spending more on marketing
• Expanding your product range
• Producing more goods, faster
• Hiring more skilled staff
• Opening new stores

Happy customers won't just return time and time again – they'll recommend you to their friends and family. From an offhand remark to full-on evangelism, the power of word-of-mouth advertising cannot be underestimated. If you've got the chance to delight customers, take it – it can pay dividends for years to come.

Retail management responsibilities

• Manage employees
• Handle customer complaints
• Monitor store performance
• Mitigate shrinkage

The specific responsibilities of a retail manager will vary depending on the size and type of store they're running. But there are some core duties that all retail managers need to be aware of:

Manage employees

The retail sector provides more than one in four jobs nationwide. It also has one of the highest turnover rates, hovering about 3.4% on average. Employees are the most important asset in your store, so retail managers must excel at working with them. 

Staffing tasks a retail manager is responsible for include:

• Hiring new staff
• Training and onboarding new staff
• Forecasting staff requirements and organizing shifts
• Dealing with employee conflicts and issues
• Coaching and managing performance
• Creating systems and processes for retail employees to follow
• Ensuring everyone complies with health and safety regulations

Monitor store performance

Retail management involves setting goals for your store and staff. You'll also have to measure your performance against those goals and figure out where to allocate your resources to increase your chances of success.

Retail metrics to monitor in your store include:

• Sales goals: overall and per department
• Average basket size: how many items per transaction
• Footfall: the number of people coming into the store
• Conversion rate: the percentage of people who make a purchase

Store managers often create daily sales reports to monitor cash flow. They use a point-of-sale (POS) system and maintain registers to compile reports and monitor performance.

Tracking performance helps you understand where you need to make changes or improvements to increase sales and customers.

Handle customer complaints

No matter how good your retail environment is, there are bound to be complaints. One key responsibility of a store manager is listening with an empathetic ear. Once they understand a customer’s issue, they should work to fix the issue and prevent it from happening again. 

A bad shopper experience can almost always be turned into a moment of customer satisfaction. While "the customer is always right" isn't totally correct, it sometimes makes sense to incur a small cost to keep them happy in return for their long-term loyalty.

Monitor inventory

Effective inventory management is crucial for the success of any retail store. In fact, it’s “extremely impactful” or “moderately impactful” to a vast majority of businesses, according to one survey. 

A retail manager has to ensure that the right products are available in the right quantities at the right time, minimizing excess stock and reducing the risk of stockouts.

When it comes to monitoring inventory a retail manager might do the following:

• Stock level management
• Inventory audits and counts
• Reorder products
• Returns management
• Track inventory turnover
• Shelf life and expiry management
• Manage inventory management software
• Supplier management

Mitigate shrinkage 

Shrinkage is the retail industry term for the loss of inventory through theft and other means, and it's a serious problem. The average shrink rate is 1.6%, according to the NRF.

The big problem is that when you lose inventory through shrinkage, you can’t recoup the cost of the merchandise as there is nothing to sell or return.

Common types of shrinkage include:

• Shoplifting or theft
• Return fraud
• Employee theft
• Administrative error
• Vendor fraud
• Unattributed loss

It’s a retail manager’s responsibility to reduce shrinkage in your store through security measures, employee training, and stock management processes. Shrinkage is unlikely to be completely eliminated, so many retailers include it in their accounts as an expected financial loss. The goal is to keep that figure as low as possible.

Supervise retail staff

Employee management is important for all stores, whether you have a team of one or 100. Effective staff management helps create a productive and harmonious work environment. 

A retail manager should ensure that employees collaborate and work towards common business goals. This involves regular communication, delegating tasks appropriately, and fostering a positive work culture.

Key supervisory tasks include:

• Leading team meetings
• Monitoring and encouraging employee performance
• Providing constructive feedback
• Ensuring staff adherence to company policies
• Dealing with employee conflict or complaints
• Organizing staff training programs
• Managing the schedule

Provide outstanding customer service 

Customer service is at the heart of retail success. Poor customer service will surely tank your business, so retail management must take a hands-on approach.

A store manager should always lead by example, demonstrating excellent customer service skills and ensuring their team does the same. Happy customers are more likely to become repeat customers and recommend the store to others.

This could mean greeting customers when they enter the store, answering shopper questions, and even organizing fitting rooms. It’s also important to keep the store clean, organized, and visually appealing.

Retail managers should also be equipped to handle customer complaints and returns professionally and empathetically.

Managers need these skills, and they must also impress these skills upon their staff. 

Design store layouts 

A well-designed store layout can significantly impact the customer experience and, ultimately, sales. Retail management must understand the principles of visual merchandising and customer flow to optimize the shopping experience.

Managers should take a proactive role in planning and arranging product displays to maximize visibility and appeal and in creating attractive window displays to draw in foot traffic.

It’s also their responsibility to organize aisles and shelves in a logical, easy-to-navigate manner, ensuring high-demand items are easily accessible. They may strategically place impulse buys at key traffic areas or the checkout counter. They should also switch it up, keeping the layout fresh and updated with seasonal changes and new arrivals.

Set goals and monitor data

Setting goals is important for any business. A retail manager can take the lead in setting these goals, sharing them with the team, and managing their progress toward said goals. This requires some data analysis to make informed decisions about store operations.

Retail managers can set sales targets and performance benchmarks, analyze sales data to identify market trends and opportunities, and adjust strategies based on performance metrics. It’s also a good idea for retail management to communicate goals and progress to the team regularly.

Create store processes 

Every store needs processes to help it run smoothly and deliver a consistent customer experience. Retail managers have the responsibility of developing and implementing standard operating procedures (SOPs) for various aspects of store management—and ensuring all staff are trained on and follow these processes

Some processes might include: 

• Creating SOPs for tasks like opening and closing the store, handling cash, and managing inventory
• Building systems for stock replenishment and order management
• Continuously reviewing and improving processes to enhance efficiency and customer satisfaction

Retail management skills 

Wondering if retail management is the right option for you? You'll need a particular set of skills to make it work. Here are the main ones:

• Customer service
• Leadership ability
• Product knowledge
• Basic analytics skill
• Communication
• Organization
• Marketing
• Teamwork
• Technology proficiency
• Analytical and strategic
• Time management

The future of retail management 

The world of retail never stands still. Here are some trends in retail management that will likely emerge soon.

Virtual shopping

Virtual shopping is already a reality for many retail brands, and it's only going to become more common. With technology like augmented reality and virtual reality, shoppers will be able to try on clothes, test out makeup, and see how furniture would look in their homes without ever having to set foot in a store. Sales associates can also serve customers remotely and give expert recommendations.

This means retail managers will need to be comfortable with the technology options out there, and potentially implement them to create an immersive shopping experience for their customers.

Experiential retail

In recent years, there's been a move away from traditional retail experiences toward something more sensory and connected. Experiential retail is all about creating an engaging environment for shoppers through brand activations, in-store events, masterclasses, and community meetups.

As a retail manager, you must be aware of this trend and ready to create enticing experiences for shoppers.

AI in retail management 

AI is impacting every industry, and retail certainly isn’t escaping it. While many fear AI is competing for their jobs, the technology can actually help retail managers do their jobs even better. AI can handle tedious and repetitive tasks, mitigate human error and data discrepancies, and overall help you run a more efficient business. 

AI in retail management could include functions like: 

• Demand forecasting
• Supply chain management
• Fraud detection and prevention
• Chatbots
• Personalization
• Inventory management

Master retail management in your store

Successful retail management involves many moving parts, but if you're organized and have a good team around you, it can be an extremely rewarding role. The sense of achievement you get from seeing your store grow and succeed is unlike any other.

Retail management FAQ

What is the meaning of retail management?

Retail management is when a retail business manages its day-to-day operations. This includes managing sales, inventory, customer service, marketing, and employee relations. It also involves creating and implementing a business strategy that aligns with the retailer’s mission and objectives.

What are the three types of retail management?

• Traditional Retail Management: This type of management involves overseeing the entire retail store operation, including inventory management, customer service, marketing, and sales.
• Multi-channel Retail Management: This type of retail management involves managing retail operations across multiple channels including physical stores, online stores, and marketplaces.
• Visual Merchandising and Store Planning: This type of retail management involves creating an attractive and inviting store environment to attract and retain customers.

Is retail management a good career option?

Yes, retail management is a good career option. The retail industry continues to grow alongside ecommerce, so career opportunities also continue to grow. A good retail management program will teach you excellent business administration and customer relationship management skills you can apply.

What does a retail manager do every day?

A retail manager oversees the daily operations of a brick-and-mortar store. This may include managing inventory, staff, customers, sales, technology, and more.