A Study on the Impact of Staff Turnover on Retail Profitability

This report investigates the impact of staff turnover on the profitability of businesses, with a specific focus on the retail sector and a case study of 7-Eleven. It defines staff turnover, explores its causes such as discrimination, poor working conditions, and lack of growth opportunities, and analyzes its negative impacts on sales, brand image, and overall costs. The research employs a qualitative approach, gathering data through questionnaires from 30 employees of 7-Eleven. The findings reveal that a majority of employees believe staff turnover is a significant problem that can decrease profitability and negatively affect brand image. The report concludes with recommendations for retailers to improve employee satisfaction and retention rates, ultimately enhancing business performance. Desklib provides access to this and other solved assignments.

Research Project
1

Contents
TITLE: TO IDENTIFY IMPACT OF STAFF TURNOVER BUSINESS PROBLEM ON
PROFITABILITY OF BUSINESES. STUDY ON RETAIL SECTOR....................................3
INTRODUCTION......................................................................................................................3
Background of the study.........................................................................................................3
Research aim and objectives..................................................................................................4
Rationale.................................................................................................................................4
LITERATURE REVIEW...........................................................................................................4
Staff turnover business problem.............................................................................................4
Causes of staff turnover business problem.............................................................................5
Impacts of staff turnover problem on profitability of businesses...........................................6
RESEARCH METHODOLOGY...............................................................................................7
DISCUSSION AND RESULTS................................................................................................7
Data analysis...........................................................................................................................7
Discussion............................................................................................................................10
CONCLUSION AND RECOMMENDATIONS.....................................................................10
RECOMMENDATIONS.........................................................................................................11
REFERENCES.........................................................................................................................13
APPENDIX..............................................................................................................................14
Questionnaire........................................................................................................................14
2

TITLE: TO IDENTIFY IMPACT OF STAFF TURNOVER BUSINESS
PROBLEM ON PROFITABILITY OF BUSINESES. STUDY ON
RETAIL SECTOR
INTRODUCTION
Employee turnover can be defined as the number of skilled employees who leave
company over certain time period. It is one of the main business problem that is affecting
businesses to the great extent (Loomer and et.al., 2022). There are number of contemporary
issues such as: diversity, increasing technology, globalisation, government’s rules and
regulations and increasing staff turnover. Staff turnover is one of the main problems as it
affects overall performance, sales, profitability and revenue of companies. Skilled workers
are the main key resources of company who perform all functions and make company able in
accomplishing their goals. When they leave organisation then managers and employers find
difficulties in accomplishing their goals and they cannot provide qualitative products without
skilled employees. Companies need to identify causing factors of this problem and
accordingly, need to develop strategies.
Background of the study
Contemporary problems refer issues that are relevant to present day life and affect
performance and lives of people. In regard to business context, it can be said that
contemporary business problems are issues that affect profitability, image, sales and
performance of business. This study will discuss staff turnover as the main contemporary
business problem and its impact on performance of retailers. This present study is based on 7-
eleven that is an American multinational chain of retail convenience store. This present study
is going to discuss the staff turnover as a contemporary business problem that is affecting
overall performance of retailers. Further, it will discuss reasons of this problem as what
factors are leading this problem. It will then discuss negative impact that this problem can
have on businesses such as: sales, poor quality, decline in revenue generation and others. It
will show some different ways and strategies by which retailers can solve this business
problem and can increase staff retention rate. Research methodology and it’s all elements
such as: research approach, different research philosophies and different sources of primary
and secondary data collection also plays a vital role. Data analysis also makes able to
researcher in generating outcomes and accomplishing aim.
3

Research aim and objectives
Aim: Aim of conducting this study is “To discuss impacts of staff turnover contemporary
business problem on profitability of 7-Eleven retail chain”.
Objectives
 To discuss staff turnover business problem.
 To identify causes of staff turnover business problem.
 To explore impacts of staff turnover problem on profitability of 7-eleven retailer.
 To suggest strategies of decreasing business issue and increasing staff retention rate.
Rationale
The main aim of selecting this topic is to make retailers able in improving their performance.
By reviewing this study, retailers can identify causes of staff turnover and accordingly, they
can develop strategies for decreasing this rate (Al-Suraihi and et.al., 2021). Other reason of
selecting this topic is personal interest. I want to get an employment opportunity in retail
sector and by conducting this study, I can make myself beneficial and can perform my job
role in an effective manner.
LITERATURE REVIEW
Staff turnover business problem
According to the Gandy, R., Harrison and Gold, (2018) staff turnover can be defined
as the numbers of employees who do not stay with business for the long run and within short
period, they leave organisation. In addition, it is also stated that this business problem affects
overall business performance to the great extent. Companies need to focus on this problem in
order to become successful and accomplishing goals as well as vision. Staff retention should
be the main key of companies as by developing strategies for retaining skilled employees
with itself, it can take competitive advantages.
Velten and Lashley, (2018) supported above view and stated that staff turnover is one
of the main contemporary business problem that retailers are facing after covid-19. Due to
covid-19, businesses cut down jobs and it made employees unemployed. After covid-19,
employees have become health conscious and they prefer to work with companies that
promotes health and safety and ensure their safety. Also, employees who were fired at that
4

time do not prefer working with same companies. So, it is increasing staff turnover business
problem or increasing the number of employees who are leaving organisation.
Causes of staff turnover business problem
There are number of factors that can lead staff turnover business problem and as per
the Dwesini, (2019) discrimination is one of the main reasons that lead staff turnover
problem. In this context, it can be said that when employees are being not treated in an
effective and fair manner then it makes them feel de-valued and de-motivated. They are less
likely to stay with business. Employees prefer to be treated in a fair manner and they should
be appraised on the basis of their performance not on the basis of racism and other reasons.
So, when employers discriminated employees then it can lead staff turnover problem.
Belete, (2018) argued and stated that poor health and safety at workplace, poor pay
scale, poor management and ineffective policies are main causing factors that lead staff
turnover problem. There are number of retailers that have high staff retention rate and from
survey, it is known that flexibility to employees, effective management and recognition are
some keys that increase staff retention. When employees are not being paid as per their
qualification and experience then it makes them feel de-valued and de-motivated as well.
They are less likely to stay with business for the long run and it increases staff turnover rate.
In addition, it can be said that employees find difficulties in maintaining a balance between
personal and professional lives. It increases frustration and it is the reason as employees
prefer working with those companies that provide flexibility in working hours and allow
them to enjoy their personal lives as well. So, on the basis of this, it can be said that people
prefer to work at place and with those people who values their needs and provide health and
safety. Poor health and safety at workplace and lack of motivation are some main causing
factors.
Jarupathirun and De Gennaro, (2018) supported above view and stated that lack of
growth and opportunities, workload, overwork and others are some causing reasons of staff
turnover business problem that retailers are facing nowadays. Due to competition and
increasing rise of retailers, employees are being forced to work for longer hours and complete
their allotted tasks and target based work. It increases pressure on workers and sometimes
they find difficulties in completing tasks. It affects their performance and make them
frustrated. Frustration affect their health and also affect their relation with their family
members. For protecting against negative impacts of workload and over working hours,
5

employees switch their brand and they are more likely to work with those companies that
consider their needs and improve satisfaction level.
Impacts of staff turnover problem on profitability of businesses
According to the Olubiyi and et.al., (2019) staff turnover business problem affect
overall performance of companies. For supporting this view, it is stated that due to high staff
turnover, companies find difficulties in providing qualitative products and services to
customers in a timely manner. Due to shortage of skilled employees, companies cannot take
number of orders and this problem can affect their sales and profitability. When customers do
not get their products in a timely manner then it affects their trust and they also switch brand.
So, on the basis of this, it can be said that staff turnover can affect profitability and sales as
well.
Al-Ali and et.al., (2019) supported above view and said that when employees leave
organisation then they talk about company with their friends and family members. They tell
all negative points about company such as: its wage system, lack of flexibility, motivation
and others. This conversation of ex-employees with their relatives can affect image and
reputation of company. Improved image is one of the main keys of success of companies. So,
when once image is gone, it is difficult to regain. Customers are also less likely to buy
products and services from such companies. So, on this basis, it can clearly be said that staff
turnover affects image, sales, profitability and performance as well.
As per the view of Madhani, (2022) staff turnover is one of the main business
problem that can have number of negative impact on performance and profitability of
companies. Staff turnover can increase overall cost of the company and lack of sales can
affect its profitability. When skilled employees leave organisation then companies need to
recruit new employees and provide them training so that they can perform tasks in an
effective manner. This recruitment process and training cost can affect its profit margin and
company may face difficulties in taking competitive advantages. It can affect its revenue
generation, sales and productivity. So, on the basis of this literature and secondary data, it can
clearly be said that retailers should focus on satisfying their employees and require to
6

consider their needs. It can increase employees’ satisfaction and improve staff retention rate
as well.
RESEARCH METHODOLOGY
Research strategy: Qualitative and quantitative are 2 research types that shows a form in
which data can be collected. For this research study, researcher has selected qualitative and
has gathered information in feelings and thematic form rather collecting in numbers form
with the main aim of knowing views of people.
Research approach: Inductive and deductive are 2 research approaches that are associated
with theories by which data can be collected and analysed (Gupta, Park and Phaal, 2022). For
this study, inductive approach has selected and generated a brand new theory for collecting
latest information on staff turnover.
Data collection: Primary and secondary are 2 main types and for making this study reliable
and successful, both types of data have gathered. Questionnaire has conducted for collecting
primary data and literature has conducted for collecting secondary data.
Sample: Sample refers participants and procedure that is being followed to select sample is
known as sampling. For this study, random sampling has selected and 30 employees of 7-
eleven retail chain have selected as a participants of questionnaire.
Data analysis: As this study is qualitative so, by thematic data analysis under qualitative data
analysis tool has selected (Senaweera, Haddela and Dharmarathne, 2021). It will help out
researchers in making decision regarding best strategy to decrease staff turnover problem to
retailers.
DISCUSSION AND RESULTS
Data analysis
7

Theme 1: staff turnover is the main
contemporary business problem?
Participants
Strongly believe 26
Do not believe 4
Total 30
Interpretation 1: On the basis of above graph, it can be said that majority or 26 employees
of 7-elevent retailers strongly believe that staff turnover is the main problem for their
business. In addition, they also stated that employees are the one who perform functions and
help out companies in accomplishing their goals. Whereas, 4 employees said that they do not
8
Strongly believe
Do not believe
Total
0 5 10 15 20 25 30
Participants

believe that it is the main problem as there are number of other problems that can affect
companies to the great extent.
Theme 2: How can this problem affect your
company
Participants
It can decrease profitability 15
It can affect brand image 9
It can decrease sales 6
Total 30
Interpretation 2: On the basis of above data, it can be interpreted that 15 participants believe
that staff turnover can affect their profitability to the great extent. 9 employees of 7-eleven
9
It can decrease profitability
It can affect brand image
It can decrease sales
Total
0
5
10
15
20
25
30
Participants

stated that staff turnover can affect image of company and poor image can affect sales. 6
participants interpreted that this problem can decrease sales as customers do not stay with
such brands that have poor skill workforce.
Theme 3: What is the main causing factor
of staff turnover business problem
Participants
Lack of motivation 14
Lack of training 7
Increasing work load 9
Total 30
10
Lack of motivation
Lack of training
Increasing work load
Total
0
5
10
15
20
25
30
Participants

Interpretation: For suggesting strategies to retailers, it was important to know reasons of
this problem and for this reason, they were asked about causing factors of staff turnover
business problem. In this context, 14 participants stated that lack of motivation is the main
reason, 7 participants said that lack of training is the reason. 9 employees said that increasing
pressure of completing number of tasks and longer working hours is the reason of increasing
rate of staff who leave organisation.
Theme 4: What is the best strategy of your
company to decrease staff turnover rate?
Participants
Implementation of health and safety
measures
11
Fair wage system 12
Team working 7
Total 30
11

Interpretation: On the basis of above chart, it can be said that there are number of strategies
that can help out retailers in increasing staff retention rate or decreasing staff turnover
problem. 12 employees of 7-eleven said that their retailer has fair wage system and it helps
them out in retaining employees with themselves. 11 employees said that their company has
health and safety measures and it makes employees feel safe at workplace. 7 participants
interpreted that team working is the main strategy that improves relations of employees and
encourage them to stay with business.
Theme 5: Suggest strategies that should be implemented by your retailer for increasing staff
retention rate?
Interpretation: An open ended question was also asked from participants with the main aim
of providing them an opportunity to share their views. In this question, some employees
suggested that their retailers should use effective motivation models so that they can satisfy
12
Implementation of health and safety measures
Fair wage system
Team working
Total
0 5 10 15 20 25 30
Participants

needs of employees. Some other employees suggested that their retailer should provide
training so that employees can know better ways of performing functions.
Discussion
On the basis of above results, it can be said that staff turnover business problem can affect
retailers to the great extent as it can affect their performance, productivity, sales and image. It
is known from above study that lack of training, lack of motivation and increasing work load
are main causing factors. In addition, it can be said that when employees are being not
provided training then they find difficulties in completing their tasks. When they cannot
complete their tasks in an effective manner then it affects their performance and lower their
morale and they tend to leave company (Bloom and et.al., 2021). So, it is the main causing
factor. Also when there is work load on employees then they become frustrated, they work
for longer hours and it is the reason they switch companies.
It is also known from above study that implementation of health and safety tools,
team working, fair growth opportunities and motivation to employees can help out retailers in
solving this problem and taking competitive advantages. When employees are being
encouraged to work in a team then it builds their relations with others. It creates friendly and
healthy environment that motivates employees to stay with business for the long run.
Training as well as fair growth opportunity also makes employees feel valued (De Sousa
Sabbagha, Ledimo and Martins, 2018). When employees get fair wage and growth
opportunities then it also boosts their confidence and morale. They strive hard and help their
company out in accomplishing goals.
CONCLUSION AND RECOMMENDATIONS
It has been summarised from the above study that staff turnover business problem can
affect performance and productivity of companies to the great extent. There are number of
factors that can cause staff turnover problem and all main factors have been discussed in
above study. Some important and common factors that are increasing this business problem
for retailers include: lack of flexibility, motivation, lack of health and safety measures at
workplace and poor wage system. Further, it has shown number of negative impacts that staff
turnover business problem can have on overall performance of companies such as: poor
quality of products, brand image, poor performance, lack of productivity, decreased sales and
13

revenue as well. It has also been summarised that motivation plays a vital role in increasing
staff retention rate or decreasing staff turnover rate (Çelik, 2018). When employees are being
motivated in financial and non-financial manner as per the performance and experience of
employees then it makes them feel valued. Employees are more likely to work hard in an
effective manner. Maslow’s motivation theory is being suggested to retailers that can help
them out in identifying different needs of employees and increasing their satisfaction level
accordingly.
This study has also shown different types of data collection such as primary and
secondary. It has discussed different sources via which researchers can collect both primary
as well as secondary data relevant to research topic and it helps them out in accomplishing
the main research aim. Ethics also play a vital role in research study as it also enables
scholars in completing their study with effectiveness and satisfying clients.
RECOMMENDATIONS
On the basis of above discussion and results, it can be suggested to researchers that it
should have focused on conducting quantitative research rather qualitative. With quantitative
study, it can collect data in the form of numbers and by using statistical tools, it can identify
as what are the main reasons of staff turnover, what is the best strategy. But on the other
hand, it can be said that conducting quantitative research is quite time consuming as
compared to qualitative. So, it was the reason as researcher has selected qualitative over
quantitative. In addition, it can be recommended to retailers in regard to research topic that
they should implement Maslow’s as well as Herzberg’s theory of motivation. With the help
of these theories, they can identify needs of employees and by providing them rewards in the
form of financial and non-finance, they can satisfy their needs. It can increase loyalty and
trust among employees and they can more likely to stay with brand for the long run. It can
decrease staff turnover business problem and can make retailers able in increasing
performance, sales and productivity as well. It can also be suggested to retailers that they
should focus on hiring number of employees so at the time of work load, they can manage
work and employees do not have to work for extra hours. It can help them out in balancing
their personal as well as professional lives and it can increase their satisfaction.
14

REFERENCES
Books and journals
Al-Ali, W. and et.al., 2019. The mediating effect of job happiness on the relationship between
job satisfaction and employee performance and turnover intentions: A case study on
the oil and gas industry in the United Arab Emirates. Journal of Business and Retail
Management Research, 13(4).
Al-Suraihi, W.A. and et.al., 2021. Employee turnover: Causes, importance and retention
strategies. European Journal of Business and Management Research, 6(3), pp.1-10.
Belete, A.K., 2018. Turnover intention influencing factors of employees: an empirical work
review. Journal of Entrepreneurship & Organization Management, 7(3), pp.1-7.
Bloom, J.P. and et.al., 2021. Impact of staff turnover during cardiac surgical procedures. The
Journal of Thoracic and Cardiovascular Surgery, 161(1), pp.139-144.
Çelik, M., 2018. The effect of psychological capital level of employees on workplace stress
and employee turnover intention. Innovar, 28(68), pp.67-75.
De Sousa Sabbagha, M., Ledimo, O. and Martins, N., 2018. Predicting staff retention from
employee motivation and job satisfaction. Journal of Psychology in Africa, 28(2),
pp.136-140.
Dwesini, N.F., 2019. Causes and prevention of high employee turnover within the hospitality
industry: A literature review. African Journal of Hospitality, Tourism and
Leisure. 8(3). pp.1-15.
Gandy, R., Harrison, P. and Gold, J., 2018. Criticality of detailed staff turnover
measurement. Benchmarking: an international journal, 25(8), pp.2950-2967.
Gupta, N., Park, H. and Phaal, R., 2022. The portfolio planning, implementing, and
governing process: An inductive approach. Technological Forecasting and Social
Change, 180, p.121652.
Jarupathirun, S. and De Gennaro, M., 2018. Factors of work satisfaction and their influence
on employee turnover in Bangkok, Thailand. International Journal of
Technology, 9(7), pp.1460-1468.
Loomer, L. and et.al., 2022. Association between nursing home staff turnover and infection
control citations. Health services research, 57(2), pp.322-332.
Madhani, P.M., 2022. Lean Six Sigma deployment in retail industry: enhancing competitive
advantages. Available at SSRN.
Olubiyi, O. and et.al., 2019. A qualitative case study of employee turnover in retail
business. Heliyon, 5(6), p.e01796.
Senaweera, O., Haddela, P.S. and Dharmarathne, G., 2021. Effects of random sampling
methods on maximum likelihood estimates of a simple logistic regression
model. American Journal of Applied Mathematics and Statistics, 9(1), pp.28-37.
Velten, L. and Lashley, C., 2018. The meaning of cultural diversity among staff as it pertains
to employee motivation. Research in Hospitality Management, 7(2), pp.105-113.
15

APPENDIX
Questionnaire
1. Do you believe that staff turnover is the main contemporary business problem?
 Strongly believe
 Do not believe
2. According to you how can this problem affect your company?
 It can decrease profitability
 It can affect brand image
 It can decrease sales
3. According to you what is the main causing factor of staff turnover business problem?
 Lack of motivation
 Lack of training
 Increasing work load
4. What is the best strategy of your company to decrease staff turnover rate?
 Implementation of health and safety measures
 Fair wage system
 Team working
Suggest strategies that should be implemented by your retailer for increasing staff retention rate?
16