Shoppers may gripe about it, but there's a reason why retailers are putting up the Christmas decorations while the Halloween candy is still on the shelf. Starting this month and continuing through the end of December, retailers are ramping up to make the most of their peak season. Quite simply, the fourth quarter can make or break a retailer's performance for the year. The holiday season accounts for anywhere from 25 to 40 percent of retailers' total annual sales.
As they stock up on boughs of holly and what they hope will be this year's hottest-selling items, retailers are adding something else: staff. The National Retail Federation reports that retailers hired approximately 524,000 additional employees for the last two months of 2005. The numbers are expected to be similar this year.
Companies looking for seasonal help aren't just hiring sales clerks; they're also hiring people for logistics operations. Last year, one of the world's largest package shipping companies hired an additional 60,000 employees to handle an estimated daily volume of 20 million packages during the holiday season. Seasonal employees are normally placed on 90-day schedules to help out with customer service, clerk and other tasks during the annual shipping crush.
But when that 90-day period ends and the seasonal staffers depart, they sometimes leave headaches behind. It's not uncommon for companies to discover they've been the victims of inventory shrinkage, pilferage and even cash theft.
If they do, thosecompanies have no one but themselves to blame, says Kim Kerr, vice president of the LexisNexis Risk and Information Analytics Group, which provides risk and business information services. "Unfortunately, many employers will be in such a rush to staff up that they will forget arguably the most important part of the hiring process—the candidate background check," she says. Kerr urges employers to exercise the same care when hiring seasonal staffers as they do with permanent employees.
In particular, Kerr urges employers to conduct background checks to verify a candidate's identity. "This is critical since many candidates try to leverage identity fraud or misrepresent resume credentials in an effort to [commit] such crimes as inventory [pilferage] and cash theft," she says. Thieves see opportunities for seasonal employment as not only a chance for a paycheck, but also a chance to steal. Temporary workers in warehouses and distribution centers, unfortunately, are not immune to temptation. Even with the best security systems in place, an employee intent on stealing from the company is likely to succeed. According to a University of Florida study, losses stemming from inventory shrinkage cost retailers approximately $37.4 billion in 2005.
Why would an employer skip something as important as a background check? In the past, the usual excuse was lack of time amid the rush to find seasonal help. Those excuses no longer hold water, says Kerr. Managers today have access to an array of technology- based services, like online background screening services designed to identify candidates who misrepresent themselves. The most advanced online screening services can accomplish in seconds tasks that used to take days or even weeks to complete. "These newer online solutions offer fast and ... affordable background-check capabilities since they often leverage breakthrough information and analytics technologies and massive public records data repositories," Kerr explains. "[T]hey offer businesses a fast, cost-effective way to identify unacceptable job candidates before they spend valuable time and money. In many instances, reports can be downloaded in a matter of seconds and cost less than $1."
Take her advice. Spend the buck and avoid the post-holiday blues. It'll cost a lot more to treat the headache after the fact.
Gartner, Inc.