Wegmans Employee Stocking Shelves

Among the many challenges facing CEOs today, one thing is for sure— investing in employees reaps benefits for the workforce and the bottom line.

The retail industry, like so many others, is undergoing significant transformation. From changing consumer expectations to evolving market dynamics, all retailers face new challenges, including staffing shortages and high employee turnover rates. In the AlixPartners Disruption Index released in January 2023, 85% of surveyed retail CEOs reported challenges around knowing which disruptive technological, societal, or economic challenge to address first.

Despite this shifting landscape, the retail sector is experiencing growth. The critical factor for that success, according to the 2023 Fortune Best Workplaces by Industry study of more than 1.3 million employees (27,000 from the retail sector), is employee experience.

Companies that show they prioritize people tend to outperform across all culture and business metrics across industries. But employee experience—the overall quality of interactions, relationships, and support that employees receive from their organization, with significant impact on employee well-being, fairness, and purpose—is especially tied to retail success. In fact, companies on the 2023 Fortune Best Workplaces in Retail list are 52% better than their peers and outperform companies in any industry (not just retail) by 35%, including the highly competitive industries of professional services and technology by 25% and 27%, respectively.

A connection to purpose

Though pay and benefits generally have a big impact on employee experience and retention for workers in the retail industry, doing “meaningful work” also plays a major role. According to Great Place To Work®, eight out of 10 employees at winning retail workplaces report their work is meaningful compared with just four out of 10 at typical retail workplaces.

“Purposeful employees feel a sense of pride in collective accomplishment,” says Sarah Lewis-Kulin, vice president, global recognition, at Great Place To Work. “They want to work at their current companies for a long time and feel like they make a difference.”

Indeed, according to Great Place To Work research, creating a sense of purpose in retail environments makes retention 76% more likely and drives discretionary effort. Additionally, 70% more employees on the Best Workplaces in Retail list say they give extra to get the job done, compared with typical companies.

Wegmans Food Markets—the 107-year-old grocery chain based in Rochester, N.Y., which ranked No. 1 on the Fortune Best Workplaces in Retail list—found in a July 2023 employee survey that 95% of employees feel connected to the family company’s mission “to help people live healthier, better lives through exceptional food.”

“We are united in delivering on this mission together, and recognize it takes all 53,000 employees to succeed,” says Peggy Riley, vice president of employee communications and engagement. “On employees’ first days at Wegmans, we take time to explain our mission, values, and the integral role they play in our success. We explain how every individual’s work and role at Wegmans helps us collectively deliver on our mission.”

One-on-one connections

At Wegmans, managers have created a cadence of one-to-one connections with each of their employees. These listening channels—with options for in-person, digital, named, and anonymous communication—ensure that every employee has a comfortable place to share ideas, which managers sometimes implement right away.

Workers also complete a digital “People Profile,” that includes what’s important to them inside and outside of work. “By encouraging employees to share their passions, we learn what they love to do and help connect that to their work at Wegmans, making their work even more meaningful and enjoyable,” says Riley.

Wegmans’s commitment to connecting work with employee passion and purpose is working. According to Riley, almost 10% of the company’s 53,000 employees have more than 20 years of service.

“Companies that are seeking to make improvements sometimes focus just on tangible programs and practices,” says Lewis-Kulin. “But you really want to understand the deeper dynamics that are driving experience. Those are based on trust. Best Workplaces in Retail leaders take time to get to know employees as individuals with lives and talents and commitments outside of work. Then they make room for people to contribute those ideas and talents within the workplace.”

Authenticity and trust

Relative to other industries, retail companies tend to be places where people feel like they can be themselves at work, according to Great Place To Work. Eighty-five percent of employees at Best Workplaces in Retail companies report working in an agile environment, with adaptable colleagues who are open to change, compared to only 58% at a typical organization.

At Wegmans, in addition to the employee-manager relationship to support the needs of each employee, companywide channels are established to prioritize employee feedback and concerns. The “Ask Bob” program helps to transform employee ideas into action, where any employee can send a suggestion or comment to Bob Farr, senior vice president of store operations, and receive a personalized response from him. Farr responds to about 1,200 Ask Bob ideas a year. These exchanges with an executive leader embody Wegmans’s emphasis on sincere, direct connections between managers and employees.

“These companies do what they say they’re going to do; values aren’t just hanging on the walls. Wegmans has customers begging it to open stores in their areas. You only get that when you have employees who are passionate about the company.”

— Sarah Lewis-Kulin, VP, Global Recognition, Great Place To Work

In addition, employee advocates at each Wegmans location act as champions of culture and support for employees.

“Since the role originated in 1986, it has evolved from a traditional HR staffing function to one of advocacy, support, and caring for our people,” says Riley. “Advocates provide confidential, exclusive, dedicated support, and many locations have two full-time advocates to support their people. They offer an objective point of view and provide a safe space for our people to seek guidance to find resources and development opportunities, resolve personal and professional issues, access benefits, and more.”

When employee performance challenges arise, Wegmans’s employee advocates advise and coach both employees and managers.

“Rather than reporting to a store manager or anyone in the employee’s chain of command, advocates report to a HR director, who in turn reports to our vice president of store operations HR,” says Riley. “This structure preserves impartiality and builds confidence with employees that advocates represent them fairly.”

Advocates also offer support when an employee faces personal challenges away from work, adds Riley. By building ongoing, one-to-one relationships with employees at their stores, advocates become a trusted ally to help their people navigate uncertainty and connect employees with Wegmans’s many available programs and resources.

When organizations invest in becoming great places to work for all, the benefits ripple out, from employees to the broader community and society. Through their commitments to employees’ growth, well-being, and sense of purpose, retailers like Wegmans are setting the standard for a thriving work environment that can positively impact the lives of everyone involved. In a rapidly changing retail landscape, this focus on employee experience sets these companies apart in their industries while also providing valuable insights into the crucial role employee well-being plays in overall business success.

“These companies do what they say they’re going to do; values aren’t just hanging on the walls,” says Lewis-Kulin. “Wegmans has customers begging it to open stores in their areas. You only get that when you have employees who are passionate about the company.”

This article was created in partnership with FORTUNE Brand Studio.

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