Mumbai: Ahead of the festival season every year, India’s retail chains go on a hiring spree for temporary workers to prepare for a spike in sales. This year could be different.
Such hiring is likely to be muted or see only a marginal increase in the upcoming festive season as most retailers keep a watch on their expenses and seek cost-efficient ways to cater to the expected rush of shoppers during the period, recruitment agency Randstad India Ltd said.
Seasonal demand for temporary workers is expected to be on the same lines or marginally higher than last year, the agency said. During September-December in 2016, around 55,000 jobs were created in the retail space. This year, it could go to as many as 60,000, it said.
“As compared to last year, demand for temporary workforce has been a little cautious because we are coming out of a first half (of the year) which has not been very good. They definitely want additional people but not higher than what we saw last year. The focus is also slightly shifting to productivity rather than just increasing headcount. It is also about how can I maximise the manpower that is on board," said Yeshab Giri, head, specialties and Randstad Technologies, Randstad India.
The retail sector has been plagued by slow sales in the period since the November demonetization of high-value banknotes. In addition, the businesses of many consumer goods and durables makers struggled to comply with the goods and services tax (GST), resulting in a shortage of inventory.
Though the upcoming festive season is a critical period to regain business, many of them are focused on cost-efficient and smarter ways to keep up with the demand, according to hiring consultants and executives of large retailers.
Large retail firms like Future Lifestyle Fashion Ltd, a Future Group company, and Landmark Group are looking to maintain the same pace of hiring as last year.
Future Lifestyle Fashion, which runs around 200 stores across the country, plans to rely heavily on technology to perform most of its back operations, said a top human resource official at the company.
“We might not do a huge hiring this time as we have set up our systems and processes in place. Typically, we use temporary staff for inventory management because there will be huge merchandise coming in on a weekly basis. We have invested in digitalization for these processes so that we need less hands. Technology will take care of most part of it," said Venkatesh Raja, chief people officer and head of people office, Future Lifestyle Fashion.
Last year, the company hired around 800 people to cater to the spike in demand during the festival season. It looks to maintain hiring at the same level even though it has increased the number of stores in the last one year, he said.
Landmark Group, which runs apparel and home furnishing stores like Lifestyle, Max and Home Centre, plans to hire around 500-600 people during the festive season this year.
“We actually plan it in such a way that if it peaks we get more, but we will maintain the same number of people as last year," said Venkataramana B., group president (human resources), Landmark Group, on the sidelines of an event organized by the Retailers Association of India on 13 September.
According to hiring agencies TeamLease Services Ltd and Ikya Human Capital Solutions, demand for temporary workers is likely to come mostly from e-commerce companies rather than physical retail outlets.
Alka Dhingra, assistant general manager, TeamLease Services, said demand for temporary workforce in the retail space is likely to increase by 7% during the festive season though a lot of it would come from large e-commerce firms as most of them are aggressively ramping up their businesses.
“In the last one year, we have seen many retail firms investing mainly on high end positions and for roles like data analysts and strategic planners. So, a lot of focus has been put on better planning, strategising and automation," she said.
According to Pankaj Renjhen, managing director (retail services), JLL India, a property consultant, the upcoming festive season is likely to see sales growth of 10-12% and most retailers. Demonetization and GST have forced retailers to make systems, manpower planning and merchandising more efficient, he said.
Kolkata-based Spencer’s Retail Ltd, which expects to open about 8-10 stores in the next few months, plans to increase temporary hiring by up to 15%.
“We are trying to catch up with the dip in sales during the July-August months after GST took effect. We are working very hard to make sure there is adequate supply of items and that people are prepared," said Sandeep Gautam, executive director, HR, Spencer’s Retail.
The festive season started with the first day of the Navratras on 21 September, which will lead up to Dusshera on 30 September; Diwali, India’s biggest festival, falls on 19 October.