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fireburn95 said:

Let's say it was your standard brick n mortar retail store. This employee would have to face customers.
Let's say the applicant is good, well qualified and apparently reliable.

As a manager/boss, you ultimately have the final say. Let's say this transgender was a... very "obvious" transgender.
You have to balance both sides, morality/ethics vs customer experience. 

Let us respect people's opinions, and just because someone says no, let us not assume they are transphobic or phobic-anything. 
For example, there are some roles which favour females (e.g. receptionists) and it doesn't mean the manager is misandrist, just that the manager wants a female facing their clientel. 

Me? I probably wouldn't, at least not in a job where you face customers daily. We've all been in that situation where we are with someone random, and the only thought in our head is "is that a boy or girl? :o"
That's not really the reaction you want consumers to have. When you see a transgender, you often think immediately "this is a trans-person" even if you completely are accepting of their lifestyle. It's just that thought though and you feel like they would be more of a liability, even if they are completely hard working.

Your answer? be brutally honest and I do not mind if you tell me I am wrong.

It depends on who their competition is.

If that person is the only one qualified or best qualified for the roll then they would get the job, but if their appearance can effect their ability to sell goods for my business or shop I manage and other people are of an equal skill level but the non-transgendered people are more appealing physically to the point where they won't have issues selling goods then that would effect my choice and I wouldn't hire the transgendered individual.

As sad as it may sound appearance is an important quality within the retail sector, so looks would be a factor, but that goes the same for anyone regardless of their sex, age or race. As a figure head representative for your company or the business you manage you would have to consider these things.

It's unrealistic to ignore the customers comfort as they shop, the customer is always paramount, because they're spending their money and are the reason you will even have a job in the future.