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What Does “Closing Time” Mean to Your Retail Business?

Matt Palmquist

Matt Palmquist is a freelance business journalist based in Oakland, Calif.

 

Bottom LineAlthough supervisors profess to have stores’ closing routines under control, consumers and employees alike bemoan the lack of consistency in related management policies. 

Anyone who’s worked in retail or embarked on a last-minute shopping trip has wrestled with the peculiarities of closing time — that short period when a store or restaurant still technically has its doors open, but employees have begun performing the various tasks required to shut down operations for the night. Managers consistently claim they have a handle on the delicate balance that requires staff members to simultaneously serve customers and close out the day’s business. But supervisors are usually gone when the cash register slams shut, so how can they be sure?

According to a new study by the University of Tennessee’s Stephanie M. Noble and her collaborators, the ambiguities surrounding closing time represent an oft overlooked and understudied source of stress for both customers and employees — and a potential drain on profitability if companies alienate consumers or overburden their workforce. The authors interviewed managers and their employees at various retail businesses, including clothiers, pharmacies, and restaurants, about their operations during the final daily shift. They also surveyed customers who were leaving stores about closing time and sent in mystery shoppers to assess businesses’ actual operations.

Closing time represents an oft-overlooked source of stress for both customers and employees.

As it turns out, if you’ve ever felt around closing time that employees are stacking chairs a tad aggressively or glancing pointedly at their watch while fielding your question about a product, you’re not wrong. The results of the multipronged study showed that during closing times employees used several cues — cutting the background music, shutting off parts of the store, or withdrawing from interactions with shoppers — to provide not-so-subtle hints that it was time for customers to leave.

In response, shoppers who felt mistreated or unwanted around closing time retaliated in a number of ways. Beyond badmouthing the business to friends, they admitted to purposely creating messes for workers to tidy up or getting in the way of employees who were restocking or cleaning. Some said they would deliberately shop more slowly as a way of asserting their right to be in the store. And interestingly, customers who felt more loyal to the retailer were even more likely to lash out after being shooed away, presumably because they believed their previous spending should have entitled them to special treatment.

Retailers face three principal challenges at the end of the business day, the authors found:

Unclear closing times. “It bugs the living daylights out of me when a restaurant says it is open until 10 p.m. and I come in at 9:30 and am told the kitchen is closing,” one customer told the authors. Employees, meanwhile, often find themselves frustrated by managers who want to squeeze every last bit of profit out of 11th-hour transactions, which forces them to stay late to close up shop.

To overcome this discrepancy, it’s vital that managers be clear with consumers and employees about what “closing time” really means, the authors suggest. For example, some retailers have begun posting signs that differentiate between the deadline for the last entry into the store (10 p.m.) and the final transaction (10:15 p.m.). This would seem to apply most crucially to restaurants, which may find some benefit in clearly defining the difference between the closing of the kitchen and the closing of the restaurant itself.

Shoppers are also more tolerant when businesses give them an explanation for their policy. So loudspeaker announcements should not just warn consumers of the impending closing, but also thank them for being considerate to employees who have to get the store ready for the next day. Most importantly, stores must be consistent; making exceptions for last-minute customers can sow confusion, rack up overtime costs, annoy employees, and raise unrealistic expectations in the minds of consumers.

Inadequate employee training. Closing-time practices vary widely across industries, and even among retail outlets within the same company. Once managers recognize this as an issue, they must provide explicit, written guidelines on what they expect from their employees as they deal with shoppers who are lingering around the cutoff time. Supervisors should also ensure their employees keep the doors open as long as their sign promises; many consumers vowed they would not return to stores that closed before the posted time. And in the era of Yelp and other review sites, dissatisfied customers’ complaints can be especially damaging.

Lack of supervision. Stores tend to get more shorthanded as the business day ends, and managers in certain industries leave long before the doors are locked. Even when supervisors are on the premises, their tasks often shift. One manager at a grocery store told the authors, “We are always there around closing time to ensure customer and employee safety rules [are followed], but we are usually busy with reports and not focusing on employees and how they interact with the customers.”

If managers ignore consumers in favor of focusing on closing out registers or retreating to the back office, employees tend to take that as an indication of managers’ priorities. And supervisors are especially valuable around this time because they can separate gaggles of employees who lapse into socializing as customers thin out. Alternatively, companies could employ secret shoppers to specifically monitor closing-time activities. Managers could also compensate commission-based employees — whose sales may decline toward the end of their shift — for efficiently closing down the store.

Regardless of the details, it seems the first step managers must take to retain both consumers and employees is to craft a clear closing time policy and apply it consistently.

Source: “Managing Closing Time to Enhance Manager, Employee, and Customer Satisfaction,” by Stephanie M. Noble (University of Tennessee), Carol L. Esmark (Mississippi State University), and Christy Ashley (East Carolina University), Business Horizons, Mar.–Apr. 2015, vol. 58, no. 2

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What Does “Closing Time” Mean to Your Retail Business?