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The past 12 months have been turbulent to say the least, but as the new year looms on the horizon and the new season gets underway, Sally Smitherman, director at specialist recruitment consultancy Retail Human Resources, explains how the recession has affected the salaries of those who work in the buying and merchandising functions.
With the economic climate having thoroughly gone through the wringer in the past 12 months or so, one might reasonably expect the pay and remuneration market to suffer proportionately. For the first time in many years a large proportion of the retail population experienced genuine disquiet regarding the safety of their jobs. Job security became the industry's principal pre-occupation as the newspapers devoted page after page to the dire financial situation. Unsurprisingly in this period of instability and extreme cost consciousness awarding substantial pay increases has not featured highly in retailers' lists of priorities.
B&M: Buying
| Min. | Max. | Typical | |
|---|---|---|---|
| Graduate/Entry Level BAA | 16,000 | 18,000 | 17,500 |
| First Appointment Asst Buyer | 19,000 | 22,000 | 20,000 |
| Established Assistant Buyer | 23,000 | 30,000 | 26,000 |
| Junior Buyer | 30,000 | 35,000 | 32,000 |
| Buyer | 35,000 | 50,000 | 45,000 |
| Senior Buyer | 50,000 | 70,000 | 65,000 |
| Head of Buying | 70,000 | 100,000 | 90,000 |
| Buying Director | 90,000 | 120,000 | 110,000 |
That said, the buying and merchandising functions have proven to be more resilient than most. Comparisons between this year's data (generated from RHR's database of 250,000+ retail candidates) and The Appointment's 2008 head office survey show a slight but consistent increase in average salary levels. This is partially accounted for by standard of living increases, although with inflation rates still very low over the last 12 months it's debatable just how much impact these will have had. What pay rises there have been are almost certain to have come through before the credit crunch really bared its teeth - it's almost impossible to envisage many increased pay awards post the demise of Woolworths. While the problems facing retailers had been bubbling away for many months prior to this, it was the collapse of Woolies that really seemed to send the industry spiralling into a tail-spin. One should also note that even where increases have occurred, for many if not most retail professionals bonuses have been pretty much non-existent during 2009.
B&M: Merchandising
| Min. | Max. | Typical | |
|---|---|---|---|
| Graduate/Entry level Allocator | 16,000 | 18,000 | 17,500 |
| First Appt Assistant Merchandiser | 19,000 | 22,000 | 20,000 |
| Established Assistant Merchandiser | 23,000 | 30,000 | 26,000 |
| Junior Merchandiser | 30,000 | 35,000 | 32,000 |
| Merchandiser | 35,000 | 50,000 | 45,000 |
| Senior Merchandiser | 50,000 | 70,000 | 65,000 |
| Merchandise Controller | 70,000 | 100,000 | 90,000 |
| Merchandise Director | 90,000 | 120,000 | 110,000 |
In terms of changing salary ranges compared to a year ago, the middle echelons of the B&M structure were those that saw the most movement.
Junior salary levels, including Graduate or Entry Level BAAs and Allocator roles as well as First Appointment ABs or AMs, saw little to no change in the 12 months, earning up to £18k for a graduate entrant or £22k for a first-time Assistant Buyer or Assistant Merchandiser.
As these positions will not generally offer a bonus, the recession will have had little impact on the take-home pay of these candidates.
More established Assistant Buyers and Assistant Merchandisers saw the average maximum salary rise from £28k to £30k this year, whilst Junior Buyers and Junior Merchandisers saw an increase from £33k to £35k.
However, these rises are impacted by the fact these positions will not collect the bonuses (on average approximately 10%) they would have been earning 12 months ago.
Buyer and Merchandiser roles also saw an increase, with an average maximum salary of £45k for each role last year rising to £50k this year.
Similarly, however, these candidates will not collect bonuses (approximately 20%), the impact of which will be keenly felt this year.
Mirroring the junior end of the industry, more senior roles such as SB and SM also saw no change in their average salary ranges, although again bonuses will be missed. Similarly, Buying and Merchandising Directors are expected to take home the same basic salary (£90k to £120k on average).
The recruitment market
Within the majority of retailers, recruitment came virtually to a standstill this year, which is hardly surprising. The whole industry held its breath waiting to see how bad things got in the trading environment. Those companies that were forced into making redundancies could not start recruiting again (even if they wanted to) for a minimum three-month period. Many retailers slashed their recruitment budgets, or put the brakes on entirely.
More recently many of the big supermarkets have announced expansion and job creation schemes and there are the earliest signs of an economic thaw. But for the most part of the last year recruitment activity plummeted.
On a positive note, however, there was no evidence that senior candidates were being expected to take on more junior level roles (as experienced in some other industries) due to the economic stresses. For example, £70k candidates looking for a move didn't have to take a £50k role - the same level roles were available, they just took a lot longer to secure.
Geographically speaking, buying and merchandising remain fairly London-centric. There are, of course, notable examples of large retailers with head offices away from the capital. In order to entice the best candidates to their businesses, companies may opt to match London salaries in the hope of enticing the best candidates to their business. This essentially means they will earn slightly more due to the cost of living in the capital. For senior candidates, this may prove especially lucrative, as they will often still be offered a relocation package.
The future
And what of the future? Since mid-July, the market has noticeably picked up. Companies are becoming gradually more confident and, like the first flakes of snow that trigger an avalanche, this optimism is gaining momentum.
This is reflected in the amount of recruitment that is being seen in the trade, local and national press. Retailers are creating plans, strategies and structures for recruitment drives. The boost to consumer and business confidence when the Government formally announces the end of the recession is likely to see a further, more pronounced pick up in the recruitment market. The more canny retailers are already putting "feelers" out, keen to have the pick of the market before the floodgates open. It pays to be an early bird at the moment.
Even so, in the coming 12 months, it would be optimistic indeed to believe that remuneration levels will improve. Realistic estimates range from between 18 and 24 months for the market to have a positive impact on salaries and benefit packages again. But at least candidates in the B&M functions can say that they have come out of the downturn a lot better off than many others.
