The cost of labour in South Africa is increasing considerably and legislation is reducing the number of retailer friendly employment options, such as contract and casual labour. At store level, retailing is labour intensive and the cost saving potential is limited. However contemporary IT solutions provide a viable alternative to the traditional staff heavy approach. Small innovations, like electronic shelf labeling, can significantly decrease costs and improve productivity. Whilst full automation at store level is still a way off, retailers are prepared to invest in the right technologies to reduce the dependence on labour.
It is not going to be the store floor worker who will feel the impact for the race to reduce the overall employee cost. They are largely protected by unions and legislation, however we can expect a sharp drop in contract and casual work opportunities. The brunt of the blow will be felt in the management teams outside of the store.
In SA some retailers have done well to keep “non store” management costs low, but in other instances these costs appear to be substantially higher than the global norm. Centralization of management functions such as purchasing and logistics helps to reduce the management cost, but that’s not enough. As the overall costs of labour increase we will see pressure exerted by executives to cut management structures to the bone.
Whichever way you look at it, the retail industry does not look set to increase the number of people it employs in the near future. When you consider the valuable training, low level entry requirements and upward opportunities that retailing offers, you would expect Government to be bending over backwards to create an environment that would stimulate employment. In my opinion it should form the backbone of the nation’s job creation strategy. Instead we seem to find ourselves in a web of legislation designed to have the reverse effect.
For a concise summary of the amendments to the Labour Laws, click here.
BRAND ACTIVITY
| The Algoa FM Quali Juice DRINK TO YOUR HEALTH competition QUALI JUICE, one of the few of its kind that’s 100% pure fruit juice, now offers three new flavours that include African ingredients to boost your health! read more |  |
| Lighter leash products t/a The Purple Packet The Premium Lighter leash is designed to hold a standard BIG lighter or a smaller Lighter. This style clips securely to one's belt Loop ,purse strap, car visor, patio furniture, giving you quick access to a light. Premium Lighter Leash has a durable metal top locking clip mechanism. 30 count displays is 6.5 inches and have a 4 inch square footprint. (Also the Premium Mini Lighter Leash—holds the Mini BIG or rectangular lighter) read more |  |
No comments:
Post a Comment