Undercover customer: retailers put their service levels to the test.

It's a busy Saturday afternoon. Your hardware store is filled with shoppers. Salespeople greet customers with a smile, lead them to your paint department to discuss their latest projects and bring their sales presentations to a successful close. Or so you hope.

IF ONLY YOU COULD BE THAT FLY on the wall, observing your staff at work all the time. Better yet, if only you knew what your customers really think of your hardware store. Sure, you could ask them, but who's likely to tell all? A mystery shopper, that's who.

"Sometimes, the customer sees your store from a vantage point that you might not, noticing things you may have thought weren't important or that you totally overlooked," says Jim Waters, president of Salina, Kan.-based Waters True Value, with six state-wide locations and 250 employees. "I'm not in the stores every day. Even the staff who are always here miss things that a mystery shopper brings up. It's some of the best money we can spend."

Noonan True Value, with two stores and 45 employees in Springfield, Ill., hires a mystery shopper to visit one location two times a month and the other once a month. "It lets us see how we're doing from the perspective of an outside source," says Owner Matt Noonan III. "We use the …