Finding and hiring good talent is not an easy task. In fact, nearly seven in 10 employers have reported talent shortages and difficulty hiring—the highest level reported by ManpowerGroup over the past 15 years.
Yet hiring employees is fundamental to the success of your business. Having an outstanding crew can help sell more products, improve productivity, and serve customers better.
The big questions are: How do you find top talent? What’s the best onboarding process? This guide covers the best hiring practices for retail stores, with tips and examples for finding the right employee along the way.
Table of Contents
Preparing to hire employees
Know when it’s time to hire
Hiring a new employee is usually not on an entrepreneur’s immediate to-do list. They tend to keep costs low when starting a new business and will wear many hats, like customer service rep, marketer, salesperson, payroll manager, inventory specialist, and more.
The thing is, you could be holding your own business back by taking on all these responsibilities. If you’re stressed and bogged down by your workload, you may want to hire an employee.
“It’s hard to give up control,” explains small business owner and retail writer Elise Dopson. “When you’re just starting out, you’re extremely self-sufficient and confident. But once your store gets too busy, all that control becomes a liability.”
“Bringing on an employee can be a big and risky step. But hiring help and delegating responsibilities is critical if you want to build a sustainable business.”
There are two key signs that you are in a position to start hiring:
- You can’t keep up with production or orders. If you’re constantly feeling like you’re rushing to manage and fulfill orders (on top of all your other tasks), it might be time to let someone help.
- Customer service is slipping. If you’re not able to tend to customers in-store or you’re consistently missing support emails, you may want to hire help. Customer service is one of the easier tasks to hand off to a new employee, whether it’s answering phones, responding to emails, or offering assistance to shoppers.
Hiring an employee will take time, so patience is a virtue here. You do not want to rush it. There is nothing worse than hiring a bad employee.
Remember you’re not just paying for a worker’s salary, you’re paying for employee benefits, training, and revenue lost due to employee learning curves. If you need to replace them, it all goes to waste. Then you have to pay for the process all over again to hire someone new.
While it may seem like a big hurdle, with enough planning, you can find the best employees for your retail store and get the most advantage from your hiring process.
Before you begin the hiring process, it’s recommended that you read the Summary of the Major Laws of the Department of Labor. There are over 180 federal labor laws and regulations you must follow to stay compliant with federal and state governments.
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Step 1: Get an employer identification number
Before you hire anyone, you’ll need to get an employer identification number (EIN) from the IRS. EIN’s are also known as an “employer tax ID.” You use it to report taxes and other information to your state agencies and the IRS.
Apply for an EIN on the US government website, and task number one is complete!
Step 2: Register with the labor department
Some state and local governments require businesses to have ID numbers for tax purposes. Contact your local and state government official to find out if you need a tax ID number.
Depending on your labor department, it might be good to keep the following information on hand:
- Federal employer identification number
- Business structure
- Business name
- North American Industry Classification System (NAICS) code
- The number of full- and part-time employees your business has, including the owner
- The date of first payroll for employees (if possible)
- Business mailing address
- Principal business address
- Address you want unemployment claims sent to
- Contact information of key individuals (which can include the owner, partners, LLC members, CEO, or corporate officers)
Step 3: Organize your tax forms
You're responsible for filing taxes and reports on behalf of your team as an employer, so it's important to be aware of the various small business tax deadlines you'll need to meet. You’ll want to keep the following information on hand for each new employee you hire:
- Full name
- Employment start or termination date
- Tax filing number (Social Security number or EIN)
- Date of birth
- Current address
- Compensation details
- Form I-9, to verify employment eligibility in the US (both employee and employer must complete this form)
- Form W-4, for employers to determine how much federal income tax should be withheld from an employee’s paycheck
Businesses should hold their employment tax records for six years minimum to support their tax filing. Setting up a system to manage these forms helps you prepare tax returns and manage business health over time.
The IRS also has an Employer’s Tax Guide, which offers guidance on all federal tax filing requirements that could apply to your small business. You should also check with your state tax agency for any employer filing specifications.
Step 4: Get workers’ compensation insurance
Workers’ compensation insurance helps cover lost wages and medical expenses for your business if an employee gets injured or becomes sick. This insurance can include rehabilitation services and death benefits, too.
Most states require any business with one or more employees to have workers’ comp insurance. It’s an easy way to protect your business and yourself from unexpected accidents and business interruptions.
Workers’ compensation insurance varies by business. You can get a free quote online through companies like biBERK.
Step 5: Create a compensation plan
To attract and retain top talent, you want to have an attractive compensation package in place.
Your compensation plan will consist of two parts: direct compensation and indirect compensation. Direct compensation refers to what you’ll pay an employee: i.e., salary, hourly, or on commission.
Indirect compensation includes any fringe benefits you’ll offer, such as mental and dental insurance, disability, and retirement programs like a 401K.
Some examples of indirect compensation include:
- Paid holidays
- Vacation days or paid time off (PTO)
- Disability income protection
- Flexible working hours
- Promotion opportunities
- Student loan assistance programs
- Assistance with child care expenses
- Career development
- Company equipment
A compensation plan is how you lock in valuable employees. Take the time to develop a thorough program and communicate it to candidates during the interview process.
Step 6: Choose a payroll software
Are you planning to use a spreadsheet to manage payroll? Or will an online software make more sense? Managing payroll can be tough, with business owners spending six to 10 hours on payroll each month.
You’ll want to research different options and set up a payroll management method that saves you time and keeps you compliant.
Here are some payroll apps that work with Shopify POS, listed in no particular order:
When choosing the best payroll software, ask other business owners what they recommend and look at reviews online. You could also outsource payroll to a company or hire a part-time bookkeeper to manage it.
LEARN MORE: For more tips on managing payroll, read How to Effortlessly Manage Payroll as a Store Owner
Create a job description
A job description summarizes the responsibilities and qualifications for an open position. If you want to attract qualified candidates to your job, you need to create a compelling job description.
With over 250 million jobs available on sites like Indeed, a great job description can help your job stand out. The goal is to provide enough information that keeps candidates interested in your business, while remaining concise and easy to understand. An effective job description will help candidates determine if they are qualified for the role.
The first element a candidate will see about your job is the title. Make your job title specific by including key phrases that describe the role, and keep it short. Data from Appcast shows that job titles with one to three words had double the apply rate versus those with 12 or more words.
Avoid clever job titles that might confuse a candidate. Take the following example for a store associate:
🛑 Retail Jedi
✅ Retail Shop Assistant
Avoid verbiage could confuse a job seeker. Opt for a more generic title with standard experience levels a seeker is likely to search for.
Open with a strong summary about the position. This section should define the role you’re looking to hire and what expectations you have for the job.
You’ll also want to define your company culture, or the set of behavioral and procedural norms that one can find in your business. This is an important, yet commonly overlooked, part of creating a job description. According to an Indeed survey, 72% of job seekers say it’s extremely or very important to see details about a company culture.
Outline the core duties of the role. Make sure this list is detailed but concise, and communicate how the tasks are unique to your business.
For example, if you’re hiring a stylist and sales associate that requires keeping up with the latest fashion trends, include that in the job description to ensure candidates know what you’re looking for and can determine if they are qualified.
Make sure to highlight the day-to-day activities of the position. This will help candidates understand what tasks they’ll be fulfilling daily and figure out if your business is a good fit.
You’ll also want to include a list of hard and soft skills that you’re looking for in a successful employee. Include any previous job experience or education needed, as well as skills like communication and problem solving you require for the role.
Outdoor lifestyle brand Snow Peak takes this one step further. It includes a section in its Retail Associate job ad that communicates the exact soft skills needed for the role under its “This Position Might Be Right If You” section.
Snow Peak also adds “Must Have”and “Nice to Have” lists to help candidates decide if they are qualified for the role. For example, the brand prefers employees with experience using Shopify, working in outdoor and retail industry, and understanding Japanese language and culture.
Salary and benefits
Don’t leave candidates in the dark on their potential earnings. Qualified candidates will look for roles that meet their salary needs. At minimum, include a salary range and list of top perks and benefits to help candidates decide if the job offer is right for them.
“In recent years, the reality has changed, and not only because of COVID,” says Jean Simon Bolduc, Technical Director and HR Consultant at Folks.
“To be an attractive recruiter, you have to work on your employer brand and have distinctive benefits. For retailers, I recommend the ‘little wows’ that make you stand out: an extra week of vacation, time off for your birthday.”
Full-time vs. part-time employees
It’s common for small business owners to question whether to hire full-time or part-time employees. Many owners use both as their business grows and demands more from your store.
What’s the difference? A full-time employee is someone who works between 30 and 40 hours per week. Part-time employees usually work less than 30 hours per week. Hiring full- and part-time employees has a range of pros and cons.
Let’s look at some pros and cons of each type of employee.
Pros of hiring full-time employees
- Better planning. You know full-time employees are consistent with their schedules, which can help you plan for goals and workloads.
- More productive. You may see more productivity from full-timers. This is a result of spending more time in their roles and working with other full-time teammates.
- Loyalty. Full-timers often feel more attached to your business. They are part of a team where they can feel comfortable and have job security.
Cons of hiring full-time employees
- Overstaffing. You’ll always have a salary to pay, even if you’re going through a quiet period.
- Benefits expenses. Fringe benefits are expected by full-time employees, and they are expensive. These costs multiply with the more full-timers you have on staff.
Pros of hiring part-time employees
- Lower costs. You don’t have to pay salaries and benefits for part-timers.
- Flexibility. They are excellent for filling in schedule gaps around full-time schedules.
- Support. They are good for covering extra shifts (e.g., during business seasons) or whenever additional staffing is needed.
Cons of hiring part-time employees
- Inconsistency. You could experience a higher turnover rate. Sometimes people need stable hours or other priorities come up in their lives.
- Inefficiencies. Part-time employees work fewer hours and have less experience in your business, which can lead to more errors.
Overall, full-time employees offer security in scheduling and consistency in labor management. They have a similar weekly schedule and number of hours each pay period, health-care benefits, and vacation time. Part-time employees offer flexibility with staffing levels because they don’t have guaranteed hours or benefits.
Try a free 3-day trial of Shopify POS to manage staff roles and permissions for your growing team!
Finding job candidates
At this point, you’re set on hiring an employee. That’s great news! The next step is finding good candidates to fill the position. Here are five places where you can find the best talent for your role:
- Job boards
- Social media
- Your own network
- Professional groups and associations
The first place to look for job candidates is a dedicated job board or website. When it comes to candidate preferences, 60% of job seekers use jobs boards compared to 50% who use word of mouth. So let’s take a look at some popular job boards:
Posting a job on Indeed is fairly simple with this guide. It’s also free, unless you decide to pay to sponsor your job post for better visibility.
CareerBuilder is another popular job board platform, with over 80 million qualified candidates looking for jobs annually. Its unique angle is using AI data to automate insights on your ideal candidate.
The downside of using CareerBuilder however, is the cost, which starts at $219 per month (or $197 per month if paid annually) for one job posting.
If you use Indeed, it’s worth setting up a Glassdoor company profile for the extra visibility and social proof that comes with employee reviews. Like Indeed, having a basic account is free, but you can opt for paid features, such as featured reviews, by contacting the sales team.
Monster is another very popular job board site for both candidates and employers, having been in the job recruitment industry for 25 years.
As a hiring manager, Monster can help you save time with its powerful search platform, which ranks and scores candidates based on your criteria. As a bonus, it also shows you your best matches first.
Monster now offers four-day free trials, but after that prices start at $279 per month for one active job (and unlimited applications).
The final job board site on our list is Snagajob. This site specializes in recruiting hourly workers and has more than six million users searching the site every month. Similar to other job board sites, it uses “match” technology to help you find the right candidates quickly.
However, what makes Snagajob stand out among the others on this list is its cheaper pricing (among those that aren’t free). At $89 per month per post, it gets you a lot of the same features as other, higher-priced sites.
Next we’re going to look at finding candidates through social media.
Finding candidates through social media can save you both time and money (given the costs of many of the job boards detailed above). In fact, a survey conducted by the Job Description Library found that, in 2021, 79% of job seekers used social media in their search in the past year.
Let’s look at each major social network platform from a hiring manager’s perspective.
Video-sharing platform TikTok has become the place for finding and hiring Gen Z employees, many of whom are part-time hires. With the rise in career and job-related content on TikTok, the platform launched “TikTok Resumes”, a program designed to expand TikTok as a main channel for recruitment and job discovery.
TikTok partnered with popular employers such as Chipotle, Target, Alo Yoga, and Shopify, and invited job seekers to apply with a TikTok video resume. All candidates can be found through the dedicated hashtag #tiktokresumes. Both big and small companies can browse the hashtag channel and watch applicants show off their skills through creative, entertaining videos.
While it was almost considered in the above job boards section, technically LinkedIn is a “professional social network” site. According to its own data, someone is hired through LinkedIn every 8 seconds.
It’s one of the go-to places for job candidates to showcase their experiences and network with other professionals and hiring managers alike.
As the second most used app for job seekers (at 57%), Twitter is hard to ignore, especially if you’re looking to hire freelancers, contractors, or casual workers. The most common method of attracting talent through Twitter is to write a well-composed tweet and link to your company site’s vacancy page, like so:
However, if your company is a small business or a startup, many owners will post about their opening asking for potential candidates to send them a DM.
As the social network platform with the most monthly active users (over 2.8 billion), and the largest percentage of them being between 18 and 44, it also makes sense to consider Facebook to find job candidates.
On Facebook, you can create job posts through your business page and, if you want, you can boost the job listing as an ad.
However, one other effective way to hire through Facebook is looking for Facebook groups in your industry, or job searching groups, and posting about your job openings in those.
Each social media platform will have different types of active users, so be sure to research and compare what kind of employee you want versus the candidate pool of social media users.
Your own network
Searching through your personal and business networks is an effective way to start your candidate search.
We mentioned earlier that 50% of job seekers use word of mouth to find their perfect job, so in a lot of cases, your perfect candidate might be hiding in plain sight. After all, you work in your industry, and you’re very likely to know other people who do too.
While this is the least formal method of candidate searching, there are still two main steps you can follow as a starting point.
Ask your personal network (friends and family)
There is common advice out there against hiring friends or family members, but that’s not to say you can’t ask them if they know anyone who is looking for a job. This type of warm referral can cut down hiring time (and costs) significantly.
If you don’t manage to find any referrals this way, you can always turn to your personal social media account and ask your wider network.
Ask existing employees
If your business is on the larger side (you already have a few or more employees), you can ask them to find candidates in their networks. It follows the same logic as above that since they work in your industry, they’re likely to know others who do too.
If you’re not getting many referrals this way either, a lot of companies provide bonuses or other incentives (like a competition) for finding qualified candidates who successfully fill your position.
Next, we’ll go back to some of the more formal methods of finding job candidates.
One of the other most common methods of finding new job candidates for business owners is hiring specialized recruiters or recruiter firms. Of course, the COVID-19 pandemic hit the staffing and agency market hard, but it’s projected to rise back up to similar levels this year with huge demand.
Using recruiters to source candidates for you has several advantages, but here are a few:
Recruiters save you time. If you don’t have a dedicated hiring manager, recruiters can take on searching and interviewing candidates so you don’t have to.
- They can expand your network. If your personal or business network is too small, recruiters can tap into their huge networks to find the best candidates.
- If you’re new to hiring, they can help you through the hiring process. If you’re hiring your first employee, they can help you understand the processes better, since they have more experience.
Some of the best recruitment agencies in the US include:
Bear in mind that many recruitment agencies will specialize in specific sectors, having developed networks in those industries. If you’re looking for a specialized role, try searching for agencies that serve your niche.
Professional groups and associations
Our final place for you to consider sourcing job candidates is through professional groups and associations. However, this method isn’t normally a quick fix for you to fill an immediate need. Instead, you’ll want to build long-term relationships with these groups to grow and maintain industry connections.
As with recruitment agencies, professional associations will naturally specialize in specific industries. Some of them include:
- Accounting (e.g., American Account Association)
- Communication (e.g., Communications Media Management Association)
- IT (e.g., Association of Information Technology Professionals)
- Marketing (e.g., American Marketing Association)
- Sales (e.g., National Association of Sales Professionals)
If you’re doing business in an established industry, chances are there are professional associations within it you can tap into. Whichever group you choose, you’ll need to make yourself or your company known by either sponsoring events, providing content in their magazines/newsletters, or being involved in meetings.
After gathering a list of potential candidates, the next stage of the hiring process involves narrowing them down and interviewing those who have stood out.
In this section, we’re going to go through reviewing résumés, interview questions to ask (and not ask), red flags you should look out for, and how long different interview processes can take.
Depending on the number of job applications you’ve received or the applicant tracking software (ATS) your business uses, this could be one of the longest parts of the process.
Before you even start reviewing, you’ll need to be in the right mindset and be aware of potential unconscious biases. After preparing yourself mentally, let’s take a look at the practical review steps:
- Separate unqualified résumés. Even if you’ve written the best job description you can, you’ll still receive résumés that don’t meet the minimum requirements. Remove these from your consideration list.
- Look for any customized cover letters or other tailored messaging. Next, you’ll want to skim through the résumés and pick up on customized wording. Having a custom cover letter or messaging within the résumé shows they’ve put in effort.
- Look into the details. After skimming through and getting the overall impression of a résumé, start looking at the details. Do they use vague language? Do they offer specific examples of past successes?
- Résumé red flags. Finally, keep an eye out for potential red flags. Are there considerable employment gaps? (Not necessarily a bad thing, but you’ll want to discuss it at an interview.) Lots of jobs in a short period of time? No increase in responsibilities?
These steps form as an overall checklist or template you can use to review many résumés in a sitting. If you have industry-specific requirements or wants, then be sure to add those to your organization’s checklist.
After narrowing down your list of candidates to those you would potentially hire, it’s time to prepare for the interviews. You’ll need to have the same list of questions you want to ask each candidate (with some room for ad hoc questions specific to each).
Interview questions are usually split into the following categories:
- Credential verification
- Competency-based questions
- Behavioral questions
- Outside-of-the-box questions
Depending on the time available for interviewing each candidate, you may have one question of each type or several. If you’re struggling to think of questions to ask, here’s a list to get you started:
- What do you know about our company?/Why do you want to work here?
- What is your work availability and expected start date?
- What salary range are you expecting?
- Can you tell me about your current position?
- What strengths or skills can you bring to our company?
- Tell me about a project you’ve worked on that you found interesting, and why.
- Where do you see yourself in five years?
- How would your coworkers describe you? Would your boss describe you differently?
- Can you talk about a time when you had a disagreement with your boss or coworker?
- Has there ever been a time when your actions directly contributed to the success of your team? Tell me about it.
- Do you work best alone or as part of a team?
- What do you think your current company could do to improve their success? (If they’re coming back to employment after a gap, you could ask if they have any opinions on how your company could improve.)
- Why are you leaving your current position or coming back to employment now?
Beyond the minimum of verifying credentials and on-paper experience, these questions can help you gain a better understanding of how the candidate thinks and how they might perform in their new position.
Interviews provide you the opportunity to get a personal impression of your candidates that show promise on paper but end up not fitting the bill as well as other candidates. This could be due to not fitting in with the company culture or some red flags you come across during the interview.
Some red flags are more serious than others, but each one can compound and ultimately suggest the candidate is unsuitable for the position. Here are some common red flags to look out for specifically during the interview:
- Poor listening skills. If a candidate is replying with answers unrelated to the question, or if they ask repetitive questions back to you, that can indicate poor listening skills.
- Lack of specific examples. If you ask an experience or behavioral-based question and they can’t give specific examples of their actions and their results, they could lack enough experience or have inflated their experience on their résumé.
- Leaving jobs due to disagreements. If they have a history of leaving jobs because of disagreements with managers, the candidate might be the problem.
- Arriving late or unprepared. Showing up late (without an appropriate reason) and/or unprepared can show a lack of organizational ability or care for the company and position.
These are just some of the more common red flags. Other red flags can be company-culture specific, such as attire, language, or attitude toward other members of staff they interact with. Keeping an open mind toward individual candidates’ situations is important, but too many red flags should put other candidates higher up on your list.
Length of interview process
Our final tips concerning conducting interviews involve how long your interview process should be. Naturally, one of the main variables for defining the length of the interview process is the responsibility of the position you’re hiring for.
The interview process for an intern or entry-level position, typically a single interview, is going to be shorter than that of a C-suite executive with multiple rounds of interviews. Ultimately, the interview process should be smooth and efficient.
“The recruitment process must be ultra-fast and straightforward,” says Jean Simon Bolduc of Folks. “In retail, we are often dealing with younger candidates, and we need to keep things moving, otherwise they will lose interest and go elsewhere. That’s where technology comes in.Applicant tracking software is a great tool that allows candidates to fill out a form online or on the spot on a tablet to apply, even without a résumé. A great employer brand and a simple recruitment process are key in 2021.”
That being said, there are a few standard practices in terms of the process length for different types of interviews. Choosing how many of them to use depends on your business’ needs and the position.
- Initial phone or video interviews. Most phone interviews are the first contact and cover the basics, like quick questions about experience and availability for work and interviews. These typically last around 15 to 30 minutes.
- In-person interviews. These are the “interview proper.” During the COVID pandemic, these are likely to be remote video calls. Depending on the size of your business and amount of applicants, in-person interviews last anywhere from 45 minutes to a whole work day.
- Technical interviews. If the role requires a certain level of technical ability, such as engineering or automation building, you’ll want to interview and test for these skills separately from a general interview. These can also last from 45 minute to an hour or so.
- Group interviews. If you’re hiring for a position that doesn’t involve high responsibility or specialization, then group interviews can save you some time by interviewing several candidates at once. These interviews also typically last about an hour.
In most cases, you’ll find that initial phone or video interviews combined with a single in-person interview is enough to determine the suitability of candidates. However, if you have several promising candidates, you might want to also add a group interview to see how they manage communication with others alongside the interviewer(s).
Extending a job offer
After everything you and the candidate have been through, letting them know they are getting the job is an exciting and celebratory moment. A common question now is what steps to take to deliver the offer.
Run a background check
Background checks are normally done during the pre-employment process for job candidates.
It’s an important step in the hiring process because it reveals any convicted felonies or misdemeanors and any reports from Homeland Security, Drug Enforcement Administration, the FBI, and the National Sex Offender Registry database. It also checks for criminal convictions or legal issues from a candidate's past.
Done right, a background check can give you peace of mind before offering a job. Considering 53% of job applicants provide inaccurate information, it’s a good way to make sure you’re hiring a solid employee. Background checks should only be done by a legally compliant third-party provider.
Some quick and easy background check sites to use are:
Gather information about the candidate