Then multiply by 100 (do not count NEW customers in that period). Performance indicators may be: Leading: if they are predictive of success or failure. Financial KPI (Key Performance Indicator) is a measurable value that indicates how well a company is doing regarding generating revenue and profits. This gives you an indication of how much of your inventory is being sold compared to how much you purchased. This post is a small supplement to that series, which provides 12 of the most common retail KPIs, we also include a brief description of why you may want to use each. When you divide the number of units sold by the starting inventory and multiply that by 100, you get the sell-through percentage. Each business unit has its own set of KPIs. It’s hard enough to get feet in the door, so you want to, This KPI aids in measuring how often you should be ordering and, As straightforward as it sounds, this evaluates the percentages of sales that are returned. For example, the marketing team in a retail store uses marketing KPIs like customer acquisition, while the HR team uses HR KPIs like staff turnover. Average sales per transaction (AST) #3. They are two important measures of how well your retail … Or that product design needs to be tweaked to better represent what is being sold. Being short-stocked and over-stocked are equally damaging to most businesses, so getting it right is critical. These are numbers that you must regularly monitor so you can determine if your business is on the right track. Data from this metric can help you make decisions regarding training, compensation, promotions, and hiring. The data collected can help you make smart decisions, avoid common pitfalls and contribute to growth. NPS example: On a scale of 0 to 10, how likely is it that you would recommend our company, product, or service to a friend or colleague? As Content Strategist at KORONA, Michael comes from a background in blog writing and content management as well as extensive use of various point of sale systems. But to help point you in the right direction, here are 14 retail metrics and KPIs to track in your business. This can also be paired with your conversion rate metric to determine a period in which you might be under- or overstaffed. You can keep an eye on the traffic generated by paid and organic leads, calls from click-to-call buttons, etc. Types of Key Performance Indicators (KPIs) There are four types of key performance indicators which are quantitative, directional, actionable and qualitative indicators. There are a few important customer metrics to look at, depending on the type of business you have: This tracks how many people walk into your store. Lagging KPI - is a type of indicator that reflect the success or failure after an event has been consumed. It is also a good idea to track the cost of and profit from every sales lead. This is especially crucial if you’re running a local SEO campaign. These can add up to noticeable improvements over a longer time period. We suggest you pick at least 2 KPIs for each of your key business objectives. Look up what an optimal GMROI is for your retail niche and let it optimize your inventory and ordering. Input Indicator … The data from these metrics can help you channel your resources, plan cost cuts, and introduce business strategies accordingly. In other words, it takes the cost of goods sold (COGS) into account. ), change the policy to lower return rates on the item and all similar products. Understanding which KPIs are most important for your business to track is the first step. ... KPI Type … KPI is a measure used to define and evaluate how successful an organization is. It’s calculated by measuring the costs of the goods sold and dividing that by the cost of the average amount of inventory on hand. Retail KPIs - 12 KPIs You Should Be Tracking. KPI Example: Decrease inventory turnover by 5 days by 31/12/2019. Speaking of keeping a history of sales on hand, year-over-year analytics is one of the more basic, but essential KPIs. If this figure is too high, you may be selling out because you aren’t stocking enough product. KPIs can and should track accuracy, … It's true that knowledge is power, but knowing how to use that power can be another issue altogether—especially in the world of retail and e-commerce … Types of KPIs (continue…): 5. When you get caught in the daily grind, your long-term goals can easily get nudged to the sidelines. Some of the main types of Key Performance Indicators are: Time to Market: Corresponds to the launch time of a product, from idea and concept to sale availability. 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