The Brilliance of The Container Store

DISCUSSION TOPIC

The Container Store: The Employee as an ‘Extension of the Brand’ 3/20/09

TOPIC SUMMARY:

In the retail industry, a 100 percent plus annual employee turnover is not uncommon. And, in these tough economic times, that statistic doesn’t tend to be of greatest concern to operators. More likely, they’re preoccupied with determining if they can get away with one less person on the floor; cutting back on training; or increasing the commission portion of the compensation.

There is one retailer, with 46 stores and 3,500 employees, which seems to have a very different philosophy. The Container Store experiences just 10-to-15 percent annual turnover. How does the retailer achieve a number virtually unheard of in the industry?

Perhaps the most eye-opening place to start is on the interview process for a “transition team.” The transition team at The Container Store is a group of associates hired for a five-day or so tenure to transition a store between themed selling seasons. There would typically be transition teams before and after Christmas, Spring Cleaning, Back-to-School, etc. At The Container Store, the selection process for this short-term associate is more involved than what most retailers would have their full-timers go through. It consists of two interviews: one in a group setting; and one face-to-face lasting an hour and a half. If there is a next step, the candidate is taken for a walk around the store with a group of other candidates and asked “what if” questions largely oriented to customer interaction. (Note: This is for associates who are being hired to change displays, fixtures and move merchandise – not to sell product.)

Karyn Maynard is The Container Store’s director of recruiting. When asked about this process, she said this type of attention to detail is not unusual for The Container Store. “We believe each employee is an extension of our brand. The staff in the office can write all day long about how great we are, but it is our associates on the floor who communicate it by action with the shopper.”

The evaluation process is very deep regardless of the position. “We want to hire great people and we want to retain great people,” said Ms. Maynard. “We have part-timers who have been with us over 15 years.”

The evaluation process also goes both ways. As with any screening process, The Container Store wants to be sure the future employee is the right fit. But, The Container Store also wants to be sure the company is the right fit for the employee. The company considers it symbolic that their very first hire was a customer.

“This process has been an evolution,” recalls Ms. Maynard. “When the founders started the company in 1978 they wanted to have ‘the best retail organization in the country.’ We are certainly more sophisticated now than they were then, but even our first hire started us in the right direction.”

Today, in fact, most employees are former customers. Many are approached on the sales floor when they are shopping. (“Have you ever considered…?”) The other source of talent is online through The Container Store website, where every application is reviewed and replied to.

When asked what mistakes other retailers make, Ms. Maynard quickly answered, “They are not making a commitment to time.”

(By the way, Karyn Maynard did not come up through the Human Resource department. She came up through the stores, like everyone else at The Container Store.)

Discussion questions:  The Container Store seems to be an outlier when it comes to hiring in the retail industry. Do you know of other retailers with unique hiring processes? Why do you think many (if not most) retailers accept an annual turnover rate of 100 percent? What does The Container Store gain from such an extraordinarily low turnover rate?

My post: 

I’ve watched the Container Store for years and have always been impressed that they have never wavered from their “commitment to time” in talent acquisition, education, and ongoing improvement of these processes.  They are simply maniacal about this.  We all know that having extraordinary people outweighs any temporary lack of extraordinary products, services, or strategies.  But few companies focus on the people side with the same level of intensity that The Container Store executes daily.  Why?  It started at the beginning with the founders’ personal focus on hiring and educating the best workforce anywhere.  For any company wishing to emulate The Container Store’s success, it must start at the very top.  The leader must ensure their lieutenants share their maniacal focus and stay on this literally forever.  Any relaxation in this focus will allow slippage.  There is no shortage of information on developing excellent hiring, education, and retention processes.  There is, however, a terrible shortage of leaders willing to make this the company’s #1 priority.

Mike Osorio, your Dare to be Contagious! TM strategist

www.OsorioGroup.com

What do you think?  Please add your comments and add to the discussion!

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Go to the full discussion at RetailWire.com:
http://www.retailwire.com/Discussions/Sngl_Discussion.cfm/13624

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2 Responses to The Brilliance of The Container Store

  1. […] The Container Store, the US-based storage products retail chain, has been successfully using the marketing-HR mash up strategy. Their focus on employer branding has put The Container Store at the top of Fortune magazines “The 100 Best Companies to Work For” list for ten consecutive years. The company believes that their employees are an extension to their product brand. […]

  2. Emily says:

    I’ve always thought that companies could do a better job of interviewing. There should be an extended process where each side gets to know one another. There should be a test drive for the employee so that they really know what they are getting themselves into. It does take time but it is worth it in the long run, with lower turnover rates. Especially in the retail industry this is important.

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