How much should a shopping center and shoe retail work?

Retailers are discussing an initiative to reduce working hours in shopping centers in Russia.

Andrei Pavlov, head of the second largest shoe retailer in Russia, president of the Zenden Group, and member of the board of the National Network Trade Association (NAST), has taken the initiative to reduce the working hours of shopping centers in Russia. He sent the corresponding appeal to the Ministry of Industry and Trade of the Russian Federation and put forward the initiative for public discussion. The retailer’s offer turned into a heated discussion among retail business participants.

Two hours less

Today, shopping malls and network retailer points in Russia, as a rule, work from 10 to 22-23 hours, which, according to Andrei Pavlov, is redundant and irrational. He proposes to establish the work schedule of shopping centers from 11 to 21 hours. 

“Thus, in the first place, the burden will be reduced on sellers who, in violation of the labor code, often have to work 10 hours a day,” says Andrei Pavlov. - In addition, from our own experience we see that in the first morning and last evening hours the lowest buying activity is observed. At this time, account for no more than 2-3% of daily sales. Having reduced retail operating time by 2-3 hours, retailers will save on electricity and staff costs. ” As an example, Andrei Pavlov gives the retail work schedule adopted in European countries. For example, in Germany, shoe stores operate from 11 to 18.30.

The retailer’s initiative met with mixed reactions from other retailers, so far they haven’t reached a single agreement on this issue either. National Network Trade Association (NAST)Nevertheless, according to representatives of the retailers association, this issue is included in the agenda of the next meeting of NAST representatives with Deputy Minister of Industry and Trade of Russia Viktor Yevtukhov. In the meantime, the initiative has been submitted for public comment.

Pros and cons

“I don’t see any significant savings from shortening the working day,” the owner of the chain of stores comments on the proposal of Andrei Pavlov "German Shoes" Anatoly Levshin... - We are all used to the fact that shops are open from 9-10 am and until late. Breaking habits is very difficult. In the shopping center "Semenovsky", where one of our stores is located, at first it was decided to give the second Wednesday of the month for a cleaning day, that is, the stores did not work all day. But then we decided that it was very expensive for us to lose a whole day of sales, and in the end this rule was canceled. "

The director of the shoe retail chain is of the same opinion. MakFine Svetlana Selyutina. “For our small retail chain (14 MakFine stores), reducing the working day by a couple of hours will not play a big role in saving money. But it may be more relevant for large retail chains, ”she suggests.

And the deputy general director Vagabond Anton Khukharev indicates that comparing the work schedule of shopping centers in Europe and in Russia is not entirely correct. “The specifics of retail in Europe is determined by the current legislation, which limits not only the opening hours of shopping centers and street-retail stores, but also strictly regulates the opening hours of enterprises. Therefore, if we are talking about small cities, the working day of most enterprises ends at 17-00, stores close at 18-00, so people have the opportunity to make purchases. It is also important to note that in European metropolitan areas, as a rule, stores work longer, large shopping centers, designed, including for tourists, work up to 22-00. In Russia, enterprises do not start work at 8-00, but at 9-00, or even at 10-00, we also do not have strict legislative instruments that limit the length of the working day, most of the employees of commercial enterprises often leave work several hours later ”, He notes.

According to Anton Khukharev, in Vagabond stores, which are mostly open in shopping centers, the vast majority of sales on weekdays occur between 18-00 and 21-00. “At this time, retail makes about 2/3 of daily sales, on weekends the statistics are different, sales are more evenly distributed over the hours. In the case of a reduction in the opening hours of shopping centers, one should expect a reduction in costs solely from wages, which will amount to about 3% of the turnover, while the drop in sales may be much higher. The rent, which makes up a much larger share in the cost structure, will remain unchanged; shopping center owners are unlikely to heed the initiative and will reduce rent in proportion to the reduction in opening hours. Accordingly, as a result, the share of costs will increase significantly. I am categorically against it and I believe that this initiative will bring enormous damage to both retail and the economy as a whole. In my opinion, the ideal opening hours for shopping centers in Russia are Sunday - Thursday 10-00 - 22-00; Friday - Saturday 10-00 - 23-00 (00-00) ".

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Individual choice

The mode of operation of retailers and shopping centers should be individual. This will help optimize costs and ensure revenue and profits based on the needs and demands of customers and customers, ”he said. Country Manager GEOX Russia Sergey Shuvalov.

“It is true that many stores in Europe are open until 18.30 pm, thus giving their employees more free time. But many European offices finish their work at 18.00 and office employees, being customers of stores, simply do not have time to visit them. This affects the revenue and profits of most retailers in European countries, and given that 90% of them also keep their stores closed on Sunday, we can talk about significant losses (loss of profit). Even in cases when European shopping centers are open until 20.00, which gives a chance to visit them after work, the time for buyers to choose and make a purchase decision is limited, and in the fashion segment, for obvious reasons, purchases are rarely made in rush mode ...

In our country, the situation is different, with us the retail is mainly concentrated in shopping centers (up to 70-80%). In Russia, and in particular in Moscow, at many offices the working day lasts until 19.00 - 19.30. Given the Moscow evening road traffic, sometimes it takes a lot of time to get to a particular shopping center, and if the shopping center closes before 22.00, buyers will have very little time to choose and make purchases.

Again, to reduce the costs of retailers, it is necessary to correctly evaluate the traffic of customers and the location of the store. So, for shops located in business centers combined with retail space, it would be advisable to set the working day to 21.00. in this case, the owners could save on their costs or possibly work in the mode from 8.00 to 20.00, focusing on the traffic of office employees. And malls on the outskirts of cities should be open before 22.00. ”

Perceived positively

Meanwhile, among retailers there are also those who positively took the new idea, such as representatives of Obuv Rossii Group of Companies.

“In general, we agree that reducing the working day for stores operating in the mall will reduce some of the costs - first of all, we are talking about utilities and transportation costs, as well as labor costs (overtime). At the same time, reducing the store’s working hours in our segment, shoe retail, will have practically no effect on revenue, because according to sales statistics, single purchases are made between 10 to 11 hours and 21 to 22 hours, ”says the head of the retail department GK “Shoes of Russia Maya Fedorchenko. 

According to Andrei Pavlov, at the moment, the most controversial among retailers is the proposal to reduce evening hours, the majority confirm the low retail sales efficiency from 9.00 to 11.00.

If the initiative of the head of the Zenden Group is implemented, these changes, of course, will affect not only shoe retail, therefore the issue requires wider discussion. Meanwhile, representatives of one of the Moscow jewelry chains reacted rather positively to the news, calling the initiative correct. Discussing the consequences of reducing evening hours, they noted: "If the working day of the mall becomes shorter, the traffic in stores will not fall, it will be redistributed to other opening hours, and retail will not lose anything from this."