Commentary

A two-prong approach to reducing retail risk, boosting customer experience

Dillon Blake, Motus director of sales, and Ridge Foust, Motus senior sales executive, explain how retailers can employ technology to improve visibility while reducing risk and focus on creating a great customer experience.

Photo by iStock.com

October 16, 2018

By Dillon Blake, Motus director of sales, and Ridge Foust, Motus senior sales executive

The retail industry faces no shortage of challenges, including stiff competition, the popularity of e-commerce, shrinking foot traffic in brick-and-mortar stores, tight profit margins and high employee turnover. It's enough to make anyone long for a simpler time: running a lemonade stand instead of a shoe store chain, or selling Girl Scout cookies instead of clothing or video games.

But with challenges come opportunities, and retail organizations are finding new ways to reduce costs and create savings — not just in actual dollars, but also in improved efficiency, more accurate mileage reimbursement, and lowered risk. How? By outsourcing some administrative tasks, such as their vehicle and mileage reimbursement programs, to reputable third parties, and employing technology to improve processes. Organizations using this combined strategy can expect three main benefits.

Better visibility of staff in relation to store performance

Gaining visibility into a mobile workforce remains an obstacle for many retail businesses. Some attempt to use the information they have on hand — mileage reports, report summaries from store visits, etc. — to piece disparate data segments together manually. This lengthy process can yield a partial picture of a manager's activities, but for a large company's district and regional managerial staff, it can take days to pull this all together — and by the time you have the information, it may already be outdated and no longer actionable.

Instead, using mobile workforce management apps that track mileage and activities in real time can facilitate a number of productivity improvements.

For example, a district manager may have responsibility for stores located in a certain area or region, but data reveals that this manager is driving 100 miles out of the way to visit a store bordering another manager's territory. Zeroing in on store locations and the routes people take to get to them will provide organizations with the information they need to restructure territories, reassign stores, or add more coverage in certain areas.

Time can also be distributed more equitably based on a company's priorities. Data may reveal that Store A is getting more attention than Store B simply because Store A is closer to a manager's home, even though Store B is a higher priority because its profits are lower. By charting frequency of visits, a company can ensure the manager is investing their time in a way that aligns with the company's goals, or add more staff to ensure every store is covered equally.

Having access to a mobile worker's daily and weekly activities via mobile workforce management apps can improve scheduling strategies, boost efficiency, reduce the amount of time managers spend in a car, streamline territory design, and allow for more face-to-face time with stores.

This is good for the organization — but it's good for a manager, too. In an era when an IRS-compliant log must state the starting point, ending point, reason for trip and total miles traveled for each stop, an employee can be burdened with significant administration. Using an application can reduce the administrative burden by up to 86 percent.

Reduced risk and accurate cost control

The same mobile workforce application used for visibility purposes also can reduce an organization's exposure to risk.

Anyone who drives a personal vehicle for business purposes needs to have a certain amount of coverage, and retail organizations should be confirming their mobile workers' insurance coverage to ensure the organization, as well as the employee, is protected from liability.

The operative words there are “should be.” While a business may require on paper that employees turn in their declarations pages, the practice often falls through the cracks, simply because there are so many other priorities to manage.

But not confirming employees have the right level of insurance creates a huge risk. Should there ever be an accident involving an employee driving for any business-related reasons, the company may be liable for related damages and expenses under the general negligence theories of vicarious liability and “respondeat superior” (literally, “let the master answer”). Even a seemingly harmless run to the bank creates risk due to this liability.

These expenses multiply if an accident results in injuries or even a fatality; in addition to dealing with the tragic circumstances of the accident, the business also faces third-party claims and even lawsuits, as most attorneys would hold the company liable to get their client a higher payout.

Risks hide within a mileage reimbursement program as well. If a company is not reimbursing an employee accurately — even if unintentionally — that company opens the door to the threat of lawsuits, especially in states with stringent labor laws like California that require companies to accurately reimburse employees for job-related expenses.

Additionally, a company should carefully vet the driving record of anyone who operates a vehicle for business purposes — and yet this is another must-do that is sometimes forgotten. When someone in a retail organization's finance or operations department is tasked with collecting insurance information or verifying driving records in addition to all of their other duties, boxes that should be checked may be left blank, simply because there isn't enough time in the day.

Outsourcing the responsibility of managing a vehicle program to a third party gets it off the plate of people who have plenty of other things to do, letting someone else chase employees down for their declarations pages, or research and vet drivers' records to see who should not be driving for business purposes.

Having accurate, verified data on hand lowers the risk of being caught without appropriate insurance coverage or putting someone on the road who's an accident waiting to happen. With such a high-impact risk, it's a mistake to assume this is being properly managed within an organization.

Outsourcing a vehicle program in conjunction with the implementation of a mileage capture tool also lowers risk. Mileage capture tools track the employee's driving and ensure that the number of miles driven equals the number of miles reimbursed, ensuring employees are being reimbursed according to the letter of the law (and also saving the company money, because employees aren't being over-reimbursed). In an era where websites like Pizza Lawsuits thrive, it's critical that a company complies with any IRS and state regulations on driver reimbursement.

Programs aligned with company goals

Outsourcing administration of vehicle programs means that companies are able to shift their focus and resources to meeting the goals that are most important to them.

These goals could take many forms, depending on the individual organization. Some companies may be able to take the cost savings from improved efficiency and more accurate reimbursements and use that money to improve employee benefits, while others may choose to implement deep discounts on items that act as loss leaders in order to get more customers in the door.

Another company goal might be to improve its employees' life. Automating mileage apps can have this effect because they streamline processes; key features like automatic trip logging, mobile expense capture, map-based searches for locations, proactive itinerary planning, one-touch navigation and notes-on-the-go simplify the activities mobile managers face every day, thus improving their productivity and reducing frustration.

Mobile management apps take away a lot of the pointless stuff, like data entry, and help managers plan their days more efficiently, freeing up managers to do more meaningful work within a store. No retail organization would argue that district or regional managers should be spending more time in a car and less time in a store, and managers would agree – meaning outsourcing mileage capture aligns with both company and employee goals.

A focus on what's important

A field team is only as functional as the tools they're equipped with, and how well they perform is more than just the training they receive and the standards they're held to — it's also about fine-tuning the frequency of store visits; optimizing time spent face to face; and shrinking time spent on travel.

Retail organizations can increase mobility and productivity in the field by staying connected and responsive with real and current data that creates a lot of value for a comparatively small price. Mobile management apps allow organizations to pull multiple processes and procedures into one centralized function, while outsourcing the management of these functions lifts the burden of protecting the company from risk and unnecessary costs from departments like HR, operations or finance.

Customers use technology like mobile phones and apps to price-shop as they walk through a store, and outsource their own chores like grocery shopping to businesses that can do it faster. Retail organizations can learn from the same tactics. By employing technology to improve visibility while reducing risk and liability, and outsourcing some functions to a third party, the retail industry can instead focus on what's important: improving profit margins by creating a great customer experience and more efficiently run stores.