5 Operational Statistics Retailers Must Get a Handle On
Retail operations managers must be able to look at hard data, analyze, and evaluate the chain operations to ensure efficiency, profitability, and effectiveness. To ensure your retail chain is operating at max capacity, you need to evaluate the following information regularly, at a bare minimum:
- Store performance – Start with your key performance indicators. You should be evaluating each store’s metrics on average spend per customer, average number of items purchased per customer, and daily, monthly, and yearly revenue numbers. This is just a start. You should also know your profit per square inch of floor space, and understand how to arrive at the numbers. The best tool you have for analyzing KPIs is a robust operational management solution.
- Employee performance – Not only should you have a handle on each store’s performance, but you should also know how your employees are performing. How much are you spending to keep each employee on the sales floor and how much is each employee bringing into your store? Do your revenues justify how much you are spending on talent? Don’t forget the cost of non-sales employees such as warehouse workers, product ordering managers, and office administrators.
- Losses – Product losses directly impact your revenues, but losses can occur for any number of reasons. You should know how much product you are losing to damages, theft, and employee negligence. Operations managers don’t like to admit it, but losses do occur as a result of products, sometime entire product orders, getting lost in transit or at the warehouse. Your job is minimize the losses.
- Store budgets – Store budgeting involves more than profit and losses. You’ve got to analyze product orders to determine if you’re ordering the right product in the right amounts as well as overhead expenses such as lighting and rent. Are your stores paying for themselves? Why or why not?
- Sales targets – It isn’t enough to set up shop and start selling. You should set some goals. That includes goals for each store as well as each sales associate. Set your sales targets and track how you reach them.
ChainDrive’s operations management solution for retailer will help you evaluate all of these metrics and more. Bring all of your stores up to standard with the right operations management tools.