The role of activity management software in a retail environment is to optimize the way teams organize their work. It allows stores to adapt to operational fluctuations in real-time, boosting efficiency and profitability through better anticipation. While it is legitimate to want to measure the impact of such a tool on performance, the question is how to do so. In other words: is it possible to calculate a clear ROI on the implementation of an activity management platform in-store?
It is important to note that a single model cannot measure every benefit of this type of solution, as human and qualitative factors are not always quantifiable. Nevertheless, certain methods have been proven effective and allow for a precise approach to measuring ROI.
Here is how to go about it…
Calculating labor costs
First, you must list the number of employees managed within the activity management tool, along with the number of weekly working hours for each contract type.
Next, calculate the total number of hours worked per month. Multiply this figure by the average fully burdened hourly rate (including payroll taxes and benefits) for each employee to determine the total monthly cost.
Estimating misallocated hours
Shortly after implementation, an activity management tool allows you to quickly identify the impact of misallocated hours, which typically ranges from 15% to 30% depending on the point of sale and the sector. These include periods of observed inactivity, overtime triggered by sudden workloads, or time spent on low-value tasks. The goal is to reduce these inefficient hours by either reassigning them to other tasks or eliminating them altogether.
After a few months of using the tool to better align your workflow with actual business needs, you can assess the reduction in misallocated hours and measure the gain from recaptured time. This allows you to calculate the hourly cost savings and the total financial gain.
Calculating the gains linked to your activity management tool
The core of the matter is determining how misallocated hours were either saved or reinvested, and what their new allocation has generated in terms of value.
Quantitative gains
There are two types of gains.
The first is quantitative, linked to the reduction of payroll expenses through fewer paid hours. This can result from a decrease in hours worked (less overtime or additional hours), a reduction in temporary staff contracts, or the decision not to replace staff during leave, illness, or RTT (compensatory time off), thanks to improved organization.
These gains can also stem from strategic decisions regarding contract modifications, staff reductions, or the reallocation of employees to other departments or locations.
Qualitative gains and performance reinvestment
The second type of gain is qualitative, representing hours reinvested into the general improvement of the store.
For example, if you choose to allocate more hours to providing customer advice at the right place and time, you should see a direct impact on sales figures and overall revenue. Similarly, if those hours are redirected toward tasks aimed at reducing stockouts or shrinkage (waste/breakage), you should see an increase in your margins, provided, of course, that you account for general business fluctuations.
On the other hand, it can be difficult to estimate the exact gains from hours reallocated to store maintenance, “facing” (merchandising), or providing a warmer welcome and better customer support. This type of evaluation is more elusive, as it relies on customer perception – the satisfaction felt from a smile, the store’s brand image, or the staff’s expertise. Since these factors are not directly quantifiable by the tool, it is important to maintain a balanced perspective when measuring success.
Ultimately, staying realistic means measuring what is measurable, knowing that everything else is simply the icing on the cake.
The human dimension and managerial growth
Beyond qualitative and quantitative gains, the human dimension of the solution represents a benefit that is perhaps less tangible, yet very real. The insights provided to the manager serve as a reliable foundation for decision-making.
Furthermore, by enabling better organization, the tool helps managers solidify their leadership, reinforce their role, and ultimately evolve in their professional journey. An invaluable asset that truly proves its worth over the long term.
The Timeskipper impact: a definitive "before and after"
The fact remains that there is a definitive “before and after” following the implementation of an activity management tool. In this regard, the Timeskipper platform enables you to recapture misallocated hours, reduce their occurrence, and reinvest them into the customer experience and store profitability—all while accounting for the various factors that cause business fluctuations.
Powered by a predictive engine driven by Artificial Intelligence, Timeskipper is the only platform capable of integrating multiple data streams to ensure that calculated gains – such as increases in sales and margins – are as precise and rational as possible.
Real-world results and rapid ROI
In the retail sector, the potential savings are significant. Based on feedback from Timeskipper clients, the ROI for this approach is consistently achieved in under six months, and frequently in less than three.
To illustrate this, let’s look at a typical mid-sized grocery store (supermarket) using our activity management tool with the following data:
- Annual Revenue: €15 million
- Staffing:
- 6 employees at 30 hours/week
- 8 employees at 36.75 hours/week
- Fully burdened hourly rate: €18
- Total hours worked per month: 2,052 hours (rounded to 2,000 for this example)
- Monthly labor costs: €36,936 (rounded to €37,000 for this example)
- Misallocated Hours (calculated by the solution): 20%, or 400 hours per month.
Through daily use of the solution and optimized task allocation, 50% of those hours were successfully recaptured, totaling 200 hours per month. This represents a theoretical monthly gain of €3,600, or more than €43,000 per year.
Gain category 1: direct labor cost savings
The solution demonstrates that of the 200 hours recaptured, 40% are directly linked to a reduction in total working hours (80 hours). This represents a reduction in payroll expenses valued at €1,440 per month, or more than €17,000 annually.
Gain category 2: reinvestment in operational excellence
An analysis of the remaining recaptured hours shows that 40% (80 hours) were reallocated to high-impact areas: increasing sales floor presence for customer advice, reducing stockouts and shrinkage, improving “facing” and merchandising quality, and general store maintenance.
By analyzing store data, it is often possible to track the positive trend in these areas. In our example:
- A 10% improvement in the shrinkage rate results in a gain of €6,000 per year.
- A reduction in stockouts generates an additional €1,000 per year.
(For specialized retail, these redirected hours typically lead to a marked improvement in overall sales volume).
As previously mentioned, benefits tied to customer perception – such as store presentation, the quality of the welcome, and staff support – are more difficult to quantify in purely financial terms.
However, looking only at the real and measurable financial gains, the total already reaches €24,000 per year!
The Timeskipper SaaS platform for daily activity management allows you to visualize and model your new organizational structure. It integrates real-time business fluctuations as well as the daily contingencies and constraints of your trade, such as staff versatility and multi-department tasking. By identifying and recovering underutilized time, the platform enables you to reinvest those hours into innovations that drive store performance.
To reach and exceed your objectives, think Timeskipper!
