An updated version of this post is available at: https://blog.compliantia.com/2019/07/30/how-to-build-a-retail-audit-checklist/
We are often asked what should go on a retail audit checklist. Sometimes this question comes from a retailer starting their retail audit program from scratch. Other times, it comes from a retailer with an existing program, looking to curate or improve their current checklist or automate the process. Regardless of the circumstances, we have prepared a list of best-practices, intentionally high-level, to help retailers with this task.
What is a retail audit checklist?
A retail audit is a smart checklist. It is based on a form, has points, best-practice pictures, supporting files, conditional items, critical items and action plan recommendations. It allows standards to be checked, deficiencies tracked, assigned and resolved when district or sales managers visit stores. An audit allows head office to guarantee company standards, programs and policies are deployed in full, in time, in every store.
Think about the checklist’s “metadata”
Metadata is data about data, which means “identifying information about the store visit”. Customers who use Excel-based forms typically expect user-entered fields such as store number, completed by, date, etc…
Metadata is largely automated/pre-populated with retail audit software. The user information is derived from the login, the store pick-list is built specifically for each user and based on the user’s current GPS location and the date is selected using a popup calendar.
Group items into sections. Sort sections according to the visit’s “natural flow”.
Whenever possible, sections should be laid out to match the natural flow of a visit (a district manager physically walking the store). Start with the exterior (the parking lot if applicable, the window in a mall location) and work your way in, around the aisles and into the back of the store.
While you can jump around between sections during or after the visit, setting up the form according to the natural flow of a visit saves time and is more intuitive.
Think about “non-applicable” items and sections
Certain sections or items may not be applicable to all locations. For example, the “Washrooms” section is probably not applicable to a store located in a shopping center. Likewise, the “Drive-thru” section won’t be applicable to a restaurant that does not have one. Retail audit software allows you to disable entire sections and items at certain stores according to the store type. Doing this saves time and again, is more intuitive.
Make sure your audit form has adequate coverage
While individual situations vary, you should address some or all of the following areas, each represented as a section:
- Store exterior (view exterior area checklist)
- Presentation and Merchandising (view sample merchandising checklist)
- Products and Preparation (view food safety checklist)
- Staff and Speed of Service
- Personnel and Training
- Equipment (view sample commercial kitchen equipment checklist)
- Security, Cash Handling and Loss Prevention (view sample loss prevention checklist)
- Drive-thru (view sample drive-thru checklist)
- Promotions (view sample merchandising checklist)
- Back of the Store and Inventory
- Washrooms (view sample washroom checklist)
- Safety (view sample fire protection checklist)
- Policy (view sample sexual harassment checklist)
Avoid large sections
Instead of creating a small number of large sections, consider creating a larger number of small sections. This helps with data-entry on smartphones and also renders the reporting more granular and meaningful.
Assign points to items according to their relative importance
Assign points according to the relative importance of each criterion. While it is easy to think of everything as important (and if a criterion is not important, it should not be on the form), some items are often more important than others, even critical to the continued success of the business. Health and safety issues come to mind.
Assign points and make use of the “Critical” flag accordingly. A critical item sets the value of the entire section to zero, regardless of other items, if found non-compliant during the visit.
Be specific, descriptive and visual
Standards should be clear and unequivocal. Don’t use vague words like “recent” or “good”. For example instead of saying, “Recent staff meeting held”, consider using, “Staff meeting held less than 5 calendar days ago”. If referring to temperatures or lapsed times, give actual numbers. Clearly spell out what the standard is.
If it takes one paragraph to define the standard, use one paragraph. If you have one, attach a best practice photo to an item to illustrate the standard; a picture is often worth 1,000 words and more likely to make an impression than words alone.
Retail audit software often allows you to attach pictures and supporting documents to any form item and section as well as tasks.
Think about visit frequency
The frequency of district manager visits (at least visits involving the retail audit checklist) can vary greatly from one organization to the next.
On one end of the spectrum, some organizations (including some big names in the food service business) tend to conduct as many as one visit every other week. Other organizations may only conduct one visit per quarter. Some organizations use a hybrid model. They use a standard form to capture their core standards (say twice a year) and create a number of smaller forms for visits throughout the year, sometimes tying these visits to seasonal programs.
Retail audit software allows an organization to create any number of forms, each with its own start and end date. Retail audit software also supports self-audits which can be used as a stop-gap measure until a district manager visit can be performed.
Discuss the form/checklist with your Operations team
Discuss the form with your district managers, franchisees and managers. Solicit their input and feedback. We call this phase “calibration“. A retail checklist is as much an audit tool, as it is a training vehicle. Define the standard, communicate and measure it. You will meet the standard and achieve your goals.
Decide whether you want to build your own audit software from scratch or buy a ready-made package
The factors that need to drive your decision are your costs, your return on investment, your time-to-market and the value and benefits that you will derive from the software you chose. Read more on buy vs build: Retail Audit Software: Buy vs Build
The Definitive Guide to Retail Audits
This comprehensive guide to retail audits is for multi-unit retailers in industries like restaurants, convenience stores, pharmacies, spas and clinics, telecommunications, and alcohol retailers. This guide also helps parking operators and manufacturers or distributors of consumer packaged goods.
If you need to collect or validate data in stores, this definitive guide to retail audits is for you!
Compliant IA is a complete retail execution and store communication platform. It runs on smartphones, tablets, and laptops. It combines task management, social collaboration, smart checklists, action plans and photo verification to ensure store programs are communicated and executed in time, in full, in all locations.
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