Opening on holidays may sound like a tempting way to juice profits, but it can backfire for retailers, she writes:
When retailers make decisions such as opening stores on Thanksgiving, without even a clear benefit to the companies or their customers, retail employees are once again reminded of how little their companies care about their lives and well being….
What retailers don't realize is that their "lean and mean" treatment of employees isn't even helping their bottom lines. If you study the longer-term consequences of treating employees this way as I have, you find that when retailers do not invest in their people, their operations suffer and their stores are full of problems such as products in the wrong place or with the wrong price, obsolete products on the shelves, and long checkout lines. These problems reduce sales and profits. Many retail chains base their labor budgets on sales; so when sales decline, so do labor budgets. Then retailers invest even less in their people and the vicious cycle continues.
Everyone suffers. Companies leave a lot of money on the table. Customers get bad service and higher prices dues to inefficiencies. The employees suffer most. But retail employees are a huge segment of our society, so our society suffers as well. A study conducted in the early 2000s found that Walmart employees in California were receiving $86 million in public assistance a year.
Want more details on the research showing that skimping on employee pay, benefits, and training in retail doesn't pay off? The New Yorker's James Surowiecki wrote excellent summation of the latest findings earlier this year, while Freakonomics author Stephen Dubner has offered a personal perspective on how badly treated employees affect shoppers (and how much they purchase).