These items have been uploaded and published about the subject

Reports

POS SOFTWARE

Before you think it is of little help 1%, let me show you have much of even improvement per year this can make.

Going to the ATO benchmark study they give what I consider the best benchmarking figures for businesses in Australia today free.

Now I picked a hairdresser shop just because it is something most of us can get our head around. Then picked the average for everything. I put it into an excel spreadsheet and then made a new column for 1% improvement.

Bottom line: I got a 25% increase in profit. That is pretty impressive.

How do we do this 1% improvement?

Well, there is an excellent quote in management theory. I learnt that "what gets measured is what gets improved." What we need to do is measure over time. This will tell you where you are, and how you got there. Then how you go compared to others. Then see where you are going if nothing changes. 

And with our POS Software, you have the tool.

Look through our reports for ones that you like, here are some key metrics, I suggest you start with.  

Total Profit
Most would say this is the most critical metric in a shop today. It is the primary method used by people to determine their business value.

Number of Customers (Customer Traffic)
The number of customers in your shop is the most straightforward metric for your retail business. 

Average profit by the sale  
This is always an exciting measure in a shop. Are people that buy more or not?  

Basket size
This shows how productive you are in the shop.

Often these are linked. For example, if you see profit per sale is down by basket size is up. Well, you are pushing the wrong products, or maybe you are overdoing discounts. 

Try giving your business a standard to measure itself for continual improvement.

 

Add new comment

Restricted HTML

  • Allowed HTML tags: <a href hreflang> <em> <strong> <cite> <blockquote cite> <code> <ul type> <ol start type> <li> <dl> <dt> <dd> <h2 id> <h3 id> <h4 id> <h5 id> <h6 id>
  • Lines and paragraphs break automatically.
  • Web page addresses and email addresses turn into links automatically.
CAPTCHA This question is for testing whether or not you are a human visitor and to prevent automated spam submissions. Image CAPTCHA
Enter the characters shown in the image.
POS SOFTWARE

One trick often used by bargain hunters is looking for items that were on sale years ago. Sometimes the old codes still work, and so they can pick up a bargain. Occasionally in bargain sites, someone will pop up noting such a deal. That is how I got a good price on some software. 

The same trick can occur in your shop. You may have items that were on sale long ago in your system. This is because someone has incorrectly not taken out the deal. So these old prices are still active despite the sale being over long ago. This is a big problem if you import from a supplier their prices directly. 

It was often not picked up as you had no stock, but this stock if it creeps back into your shop and you have an old sale price.  

You can use many reports to find these items, but we have a special report to combat this. It is specially designed to find such items. 

Go to register reports>Stock>Stock on Sale between a given period

Put in the relevant detail and see what you have.

I suggest that you do run it now. Rarely, it does not find anything.

 

 

Add new comment

Restricted HTML

  • Allowed HTML tags: <a href hreflang> <em> <strong> <cite> <blockquote cite> <code> <ul type> <ol start type> <li> <dl> <dt> <dd> <h2 id> <h3 id> <h4 id> <h5 id> <h6 id>
  • Lines and paragraphs break automatically.
  • Web page addresses and email addresses turn into links automatically.
CAPTCHA This question is for testing whether or not you are a human visitor and to prevent automated spam submissions. Image CAPTCHA
Enter the characters shown in the image.
POS SOFTWARE

I will show you how to set up and use your location dashboard in your shop.

This form of analysis is called Same-store sales and is frequently used by many retailers. I will show you how our system can do it. 

A bit of background first. Most consider in a shop different parts of your shop have different value to the business. In places in the front, a product to justify itself in the front needs good sales. While in the back, often much lower sales results are acceptable. What professional marketers do is set a budget for each area of the shop. Then what they do is compare usually monthly sales in that area. This they displayed on a dashboard. Anything significantly different raises flags.

Let us start, so first, we need to set up.

Look around your shop and divide the shop into locations. Generally, a shop is divided into departments already, so this is not hard so use departments. 

Now check that your stock has location entered. If not, then go to stock systems> stock editing> stock level editing. 

Give all your stock a suitable location. Although this will not take you a lot of time, it may take a while for the computer to process. Nothing we can do about this as we need to get locations going.

For each location you adopt, calculate the area it takes up, which is simple to do by pacing it out. Now decide what weekly budget you would like for each location to have. Generally, your till rolls at the end of the day will tell you. You need both figures area and budget to get this to work.

Now go to system maintenance> Dissection maintenance > Location

Put in the location and give it a weekly budget.

Now go to register reports>stock>weekly location targets.

Put in an appropriate date and outcomes a very detailed report, full of comparisons for each location. 

Now on the first few shots, you need to fine-tune it somewhat the figures. This is expected but once bedded down, it will work well. 

You will get a lot of relevant information on your shop from this report and it will be something you can use.

Add new comment

Restricted HTML

  • Allowed HTML tags: <a href hreflang> <em> <strong> <cite> <blockquote cite> <code> <ul type> <ol start type> <li> <dl> <dt> <dd> <h2 id> <h3 id> <h4 id> <h5 id> <h6 id>
  • Lines and paragraphs break automatically.
  • Web page addresses and email addresses turn into links automatically.
CAPTCHA This question is for testing whether or not you are a human visitor and to prevent automated spam submissions. Image CAPTCHA
Enter the characters shown in the image.
POS SOFTWARE

As I stated, GRMOI is one of the foundations of modern inventory management today. This is why we have supplied our clients with this powerful tool. 

Hopefully, now, you have been trying out Gross Margin Return on Inventory (GMROI) in your shop. If not, look at my post a few days ago and only then come back to this post.

What GMROI incorporates in one figure, stock turns and profit. It allows you to focus on margins and turnovers.

The significant advantage of GMROI 

1) It is consistent and widely used. Other systems, such as Direct Product Analysis (DDP), need you to make assumptions. They take much longer to work out. Different people using it come out with other figures. So their analysis will give various figures depending on who runs the report.  I will show you DDP in our software in another post soon because it is also excellent. 

With GMROI, everyone is looking at the same figure.

2) It is quick and easy to use. All you have to do is run a report. The computer can do the calculation.

GMROI is simple.

3) It allows you to compare widely different products quickly.  

Using it, you can compare every item in the shop in seconds.

4) Overstocking is highlighted.

This is one of its best functions so it will cut your stock levels.

Let us discuss the problems.

1) A minor product can have a terrific GMROI, but its effect on the shop can be zero. For example, if a product that turns over a lot has a decent margin, it is pretty useless if it made you a profit of $2/week. It would not even pay the handling and rent that it takes up.

So you are not going to get out of using our profit reports, which need to be considered.

2) If you understock, you can often drive the stock turns up, so giving you higher GMROI. Yet that will cost you sales.

High GMROI is not always good.

3) It does not consider other costs, e.g. handling and shipping costs or suppliers terms.  


4) It does not take into account that often you need a range of products. For example, people may come to your shop because they know you have an extensive range. If all you have is one title or brand, they may decide to go elsewhere else. After all, they can buy in a supermarket which also has a common brand. 

Range often sells.

5) It may show you problems but not what you can do to fix the problem. There may be only so many you can sell. There may be good reasons why your low margin items are low: price-sensitive, set by suppliers, etc.

Often its conclusions are not actionable. 

As a rule, I recommend looking at the extremes of the GMROI, both the high and low results, first.  Once used to GMROI, you will find it an indispensable tool.

Enjoy and let me know how it goes.

Comments

Thanks for sharing this blog. Restaurant Management can be made easy by simply installing your restaurant software. Handling various aspects of your restaurant like the front desk, kitchen, menu updates, and table allocations can be done easily.

Add new comment

Restricted HTML

  • Allowed HTML tags: <a href hreflang> <em> <strong> <cite> <blockquote cite> <code> <ul type> <ol start type> <li> <dl> <dt> <dd> <h2 id> <h3 id> <h4 id> <h5 id> <h6 id>
  • Lines and paragraphs break automatically.
  • Web page addresses and email addresses turn into links automatically.
CAPTCHA This question is for testing whether or not you are a human visitor and to prevent automated spam submissions. Image CAPTCHA
Enter the characters shown in the image.
POS SOFTWARE

A few days, I showed you could improve your shop sales by examining the item (granular) level the quantity, profit and sales.  It produced a lot of comments. These are important, but they are not considered the most crucial measurement in modern retail.  

The most crucial measure today is the Gross Margin Return on Investment (GMROI)

I will show you here what it is and how to get it immediately from your system.

Using GMROI you can get shop profit up, often dramatically.

What it measures is for every dollar invested in an item by the retailer, what profit did the retailer get back. It combines sales,  margins, stock turns and investment theory into one number.

The calculation is.

GMROI = ($Gross Sales -$Cost)/($Ave inventory at cost)

Example 

-Consider an item A with an annual sales of $1000 at a Gross Margin (or Gross Profit) of 30%

Gross Margin $$ = $300.00

Say my stock holding on an average over the year was $200

My GMROI = $300.00 / $200.00 = $1.5

What you get with this product is $1.50 back for every $1.00 you invested in that item.

- Now say we have an item B with an annual sales of $2000 at a Gross Margin (or Gross Profit) of 25%

Gross Margin $$ = $500.00

Say my stock holding on an average over the year again was $200

My GMROI = $500.00 / $200.00 = $2.5, so for every dollar, I put into this item, I get back $2.5, which is much better.

Based on this, you should push item B more even though its margins are lower. This is because it has a higher stock turn. So in theory what want items B.

Unfortunately this is an impossible calculation for a person to do for all the items in most shops manually. But it is no problem for a computer.

So what we have made is a training video to show you how to get these figures.

Please get a feel of what your items GMROI are and I will in a couple of days show you some of the benefits and limitations of it. 

Enjoy

Add new comment

Restricted HTML

  • Allowed HTML tags: <a href hreflang> <em> <strong> <cite> <blockquote cite> <code> <ul type> <ol start type> <li> <dl> <dt> <dd> <h2 id> <h3 id> <h4 id> <h5 id> <h6 id>
  • Lines and paragraphs break automatically.
  • Web page addresses and email addresses turn into links automatically.
CAPTCHA This question is for testing whether or not you are a human visitor and to prevent automated spam submissions. Image CAPTCHA
Enter the characters shown in the image.
POS SOFTWARE

Stock turns vital because most of our money is in inventory. If it is not selling well, the funds will not be available to pay employees, suppliers, banks, etc. So look at this report.

It is easy to get your report. It takes a second.

Go to Main Menu > Cash Register > Register Reports > expand Stock > select/double the click the report “Show Stock Turn by Dissection and Item.

Now select the appropriate options and then click the View Report button. I suggest running it for the past last five (5) years, the previous year, and the previous three (3) months and compare the figures. This gives you a long, medium, and short-range. See how different departments are going.

Now, you can see trends.

Like everything, you need to review these figures with intelligence. Too high figures can mean you are understocked. 
Too low often means you are overstocked.

Have a shot and see how you go.

Add new comment

Restricted HTML

  • Allowed HTML tags: <a href hreflang> <em> <strong> <cite> <blockquote cite> <code> <ul type> <ol start type> <li> <dl> <dt> <dd> <h2 id> <h3 id> <h4 id> <h5 id> <h6 id>
  • Lines and paragraphs break automatically.
  • Web page addresses and email addresses turn into links automatically.
CAPTCHA This question is for testing whether or not you are a human visitor and to prevent automated spam submissions. Image CAPTCHA
Enter the characters shown in the image.
POS SOFTWARE

Retail Express, had an interesting article that is worth looking into on page 12. In our POS Software, it is easy to try.

It is about rearranging products in the fridge into proper categories.  Doing this, they claim you can drive sales up an incredible amount. See the arrow marked in brown.

Click here for more details.

There is no reason why this theory should not work for any department. Try a department, then see what are your top sellers in that department. 

Go to register reports and select the top stock report as marked with the red arrow here.

 

You get this screen

 

Now select your department.

Here I used the stationery department. I put in 99 million in red for illustration. That is overkill - put in 100. I also selected a whole year as short periods can have significant fluctuations. We do not want to do this every week.

Now study the report to see your shop's strengths. See what do you sell. 

Now go to a major retailer's website and see how they categorize their department. Some like Amazon and the supermarkets have spent millions on this categorization, so they know something. Also, check out a few other shops. 

You now know the theory and your strengths, so layout your stock in a logical order.

Why not start now, pick a small department and see how you go?

Add new comment

Restricted HTML

  • Allowed HTML tags: <a href hreflang> <em> <strong> <cite> <blockquote cite> <code> <ul type> <ol start type> <li> <dl> <dt> <dd> <h2 id> <h3 id> <h4 id> <h5 id> <h6 id>
  • Lines and paragraphs break automatically.
  • Web page addresses and email addresses turn into links automatically.
CAPTCHA This question is for testing whether or not you are a human visitor and to prevent automated spam submissions. Image CAPTCHA
Enter the characters shown in the image.
POS SOFTWARE

Follow this, and in this instant, you can precisely know, track, and control your top-selling products in real-time. 

Go to Register reports.

 

Now pick "Top N Stock Sales for a Given Period."

 

Now in the form put in this week.

A report comes out that looks like this with your top sellers listed.

 

Do it now, and then please inform me how you went.

Add new comment

Restricted HTML

  • Allowed HTML tags: <a href hreflang> <em> <strong> <cite> <blockquote cite> <code> <ul type> <ol start type> <li> <dl> <dt> <dd> <h2 id> <h3 id> <h4 id> <h5 id> <h6 id>
  • Lines and paragraphs break automatically.
  • Web page addresses and email addresses turn into links automatically.
CAPTCHA This question is for testing whether or not you are a human visitor and to prevent automated spam submissions. Image CAPTCHA
Enter the characters shown in the image.
POS SOFTWARE

We do suggest rather than using extending credit to your customers. Look to VISA, Afterpay, or Zip. It is these people's jobs to collect money.  Sometimes it cannot be helped, and you are stuck with the debt. If you get caught out, here are the terms that our system used.

Our system uses a very formal terminology and methods here.

A token payment is a small payment made regularly by a customer who cannot afford to pay the full amount you're owed. It shows both that they have a willingness to repay the loan and they have not forgotten.

What can happen is that a person who is paying a little at a time, can at the end owe you almost nothing. This can be difficult to collect. So what we suggest you do is set up a payment plan that includes a balloon payment. This is a lump-sum payment of a decent size at the end

Add new comment

Restricted HTML

  • Allowed HTML tags: <a href hreflang> <em> <strong> <cite> <blockquote cite> <code> <ul type> <ol start type> <li> <dl> <dt> <dd> <h2 id> <h3 id> <h4 id> <h5 id> <h6 id>
  • Lines and paragraphs break automatically.
  • Web page addresses and email addresses turn into links automatically.
CAPTCHA This question is for testing whether or not you are a human visitor and to prevent automated spam submissions. Image CAPTCHA
Enter the characters shown in the image.
POS SOFTWARE

Here is a quick way to search at what sold at Christmas last year. It will take you a few seconds to do and give you much to ponder on.

Go to register reports and select the top stock report as marked with the red arrow here.

 

I think it is easier to work by departments. In dates that you are thinking of ordering for and select the top 100 items.

Now examine this list to see what did sell. 

I find it useful to do the same analysis for the year before so 2018 as it gives an extra comparison.

Add new comment

Restricted HTML

  • Allowed HTML tags: <a href hreflang> <em> <strong> <cite> <blockquote cite> <code> <ul type> <ol start type> <li> <dl> <dt> <dd> <h2 id> <h3 id> <h4 id> <h5 id> <h6 id>
  • Lines and paragraphs break automatically.
  • Web page addresses and email addresses turn into links automatically.
CAPTCHA This question is for testing whether or not you are a human visitor and to prevent automated spam submissions. Image CAPTCHA
Enter the characters shown in the image.