With the growing number of retail chains closing stores, it’s a good time to examine the numbers behind this industry that continues to struggle amid the rise of e-commerce. Fortunately, data intelligence firm Dunnhumby is here to help. Most of the following guide data come from its recently released report: The Future of Retail: How to win in today’s complex and competitive retail landscape, which examines consumer retail spending and attitudes across several major U.S. market segments.
Retail KPIs, goals, and measures of success
Retailers rely heavily on key performance indicators (or KPIs) to track and measure a diverse range of business data, from sales to inventory levels, customer service to labor costs, and staff training to social media exposure. All of these metrics and more are important to keep an eye on, but the KPIs that are most critical to track are the ones that indicate financial health. When you’re trying to determine if your business is successful, you need to establish measurable goals and then give yourself a way of measuring the results. When you’re able to track your performance, you’ll be able to tell if your business strategy is working.
Sales per square foot
Sales per square foot is a metric that’s used to evaluate retail performance. It’s a handy metric to use when assessing retail stores because sales per square foot provide insight into the efficiency of a store’s layout and its ability to attract customers. The metric is dependent on both the size of the store and its sales volume.
On a national level, retail sales per square foot can tell you how well a given country’s retailers perform. Stores in countries with high sales per square foot also tend to have high sales volumes. This suggests that the stores in those countries are doing an excellent job of converting shoppers into buyers.
Gross margins return on investment (GMROI)
As any retail store owner knows, managing gross margins and return on investment (ROM) is critical to a business’s success. If you fail to address these numbers, you could put your business in jeopardy. In this post, we’ll help you understand how to work with these two terms, how they relate to one another, and how you can use them to your advantage.
Average transaction value
Average customer transaction values are an essential factor in the retail industry. They provide a snapshot of how much money customers are spending at the store, and they’re also the basis for the average ticket, which measures the average value of a customer’s order. It’s not only an essential metric in the retail business but also corporate America in general.
Customer retention rate
Even after carefully researching what type of business to start, and even after starting the business, there’s a chance you might have to shut it down. If you’re like most business owners, that thought is painful due to the time, energy, and money you’ve invested in your business. But if your business isn’t profitable, you might have to shut it down. And if your business isn’t providing enough of a return, you might have to shut it down, too. In this post, we’ll talk about how to keep your business going and growing, so it’s a success both now and for years to come.
Foot traffic and digital traffic
While it’s true that online shopping is growing in popularity, there’s still a lot of money to be made in brick-and-mortar establishments. it’sIt’s estimated that around 90% of retail sales always take place in physical locations. What sets successful brick-and-mortars apart from the rest? One of the most critical factors is foot traffic. The more people who walk through your doors, the more likely they are to make a purchase. But how do you get foot traffic? That’s where digital traffic comes in.
Inventory turnover ratio
The inventory turnover ratio is a metric that retailers use to measure how quickly they can sell their existing inventory. The larger the inventory turnover ratio, the faster the retailer can sell their products. The rate is calculated by dividing the cost of goods sold by the average inventory.