+1 916 605 7200         moreinfo@retailpro.com        
 
   +1 916 605 7200             moreinfo@retailpro.com            
 
 
REQUEST A DEMO

Understanding Key Performance Indicators

As a retailer in a competitive marketplace, a major focus should be monitoring the health of your business. For most retailers this means getting a handle on your Key Performance Indicators, or KPIs.

Defining KPIs

A KPI is a metric that is designed to give you a quick snapshot of some aspect of your business. A KPI might be a measure of sales, customer activity, or financial strength.

More than simply a bottom line number, a KPI is usually expressed as a comparison with some other factor. For example, looking at the average sale per customer gives you an understanding of the potential value of each customer.

Which KPIs should I track?

There are hundreds of KPIs that a retail business owner could be using at any one time. If an activity can be tracked and measured in your store, a KPI can be developed to provide you with business intelligence. One of the challenges is to decide on a handful of KPIs that provide you with the most valuable information based on the goals and objectives of your operation.

Every retailer will have a different set of KPIs. For example, a business that uses commissioned sales associates to sell to customers may place a heavy emphasis on KPIs that track the effectiveness of an individual sales associate while these KPIs may be irrelevant for another retail business.

You may want to track KPIs related to your customers. Simply knowing the number of customers who enter the store each day may not be enough for you. You may want to gain a deeper understanding about your customer’s shopping patterns and what converts them from a casual shopper into a dedicated, returning customer. To do this, you need to carefully consider what data you should collect and analyze.

Choosing the right data

Data, by itself, is not a KPI until it’s arranged in a meaningful way. A list of sales transactions throughout the day is good data to have but it’s not the whole picture. The next step might be to calculate the total dollar amount of sales for the day. You can arrange the data in any number of ways:  sales by department, sales by item, or sales by cashier. At this point, you still only have data to analyze.

The strength of KPIs is knowing how to use data to gain a competitive advantage. It all comes down to the goals and objectives you set for your business.

For each goal you establish, you must also create the metric that will determine if you are successful in reaching that goal. Your KPIs become the method by which you track your progress.  If your key performance indicators do not reflect progress toward your goal, you must change the tactics you are using in your business.

Using raw data to optimize your retail operations

Retailers assess KPI performance indicators to determine how to optimize their business.

Let’s look at one simple example of how your goals and KPIs come together to give you a competitive advantage.

Marlene runs a small clothing store in a mid-size urban market. Lately things have been going good but the business has leveled off. She would like to increase her business over the next year.  She creates a goal to increase her sales by 10%.

Marlene realizes that an obvious KPI is her total sales. She can also break down her sales on a daily, weekly, monthly, or quarterly basis to compare with the previous year. This gives her the maximum degree of flexibility especially since her sales tend to fluctuate according to well-defined fashion seasons.

Marlene decides that a good strategy would be to do more advertising on radio and television during the coming year. To find out if the advertising is bring customers into the store, she decides to track footfall, the number of people coming into the store. Fortunately, she tracked her traffic last year but if she didn’t, she could use the new data by correlating store traffic with the dates and times that advertising is running to see if the ads have an immediate effect.

If she notices that store traffic increases for a few days after a television ad appears, she may make more strategic choices about when to run television ads. Or she may be sure to have a special sale during the weekend following a big flood of advertising.

By tracking average customer spend, Marlene can determine how much the average customer spends during each purchase transaction. In order to increase sales, she decides to place some displays with accessories – scarves and jewelry – close to the cash registers. The strategy works and she notices that her average customer spend amount increases due to impulse purchases while customers are waiting in line.

Although her total sales KPI indicates some overall growth, Marlene is not satisfied with the progress she is making. She begins to track her conversion rate, the number of transactions throughout the day divided by the number of people who enter the store. This seems to indicate that a lot of people are coming into the store but not many are making purchases.

Retail conversion rate

To combat this, she could implement a number of new strategies. Perhaps she should take a look at rotating her inventory more frequently so the styles are kept fresh. She might decide that she needs to add new merchandise. Eventually, Marlene decides to hire additional staff to take more time with the customers and help them pick out merchandise.

To maximize the effectiveness of her new employees, she tracks shopper to staff ratio.  This KPI lets Marlene determine if she has the appropriate number of employees on the sales floor to handle the volume of shoppers. Monitoring her wage costs, which is wages paid divided by the total sales will also help her monitor her costs.

As her business grows, Marlene may decide to implement different strategies or develop completely new goals for her business. These goals and strategies may necessitate new KPIs to help her determine if they are effective. As her needs change, so will her data collection requirements and so will the way she analyses that data.

Tracking KPIs in Retail Pro

Retailers using Retail Pro have several built-in tools to help them track important KPIs easily and automatically including 160+ pre-designed reports that can be accessed using the Retail Report Viewer tool.

Filters allow you to easily report on different aspects of your operation and break down your data into different segments to allow you to take a bird’s-eye view or get down into the weeds.

Retail Pro reports can also be completely customized using an ODBC-compliant report writer like Crystal Reports. This allows you to save time and money by adapting an existing report to show exactly the information you need without a lot of work and effort.

From inside Retail Pro, you can use customer or inventory statistics to gain more perspective.

X-Out and graphical reports allows you to look at sales activity throughout the day and get instant analysis.

Happy tracking!

Want to learn more?

See how Retail Pro can help you improve visibility into your data using KPIs.

Contact us today





Retail Pro love at #nrf17

We <3 NRF! Here’s a short video recap for all those who missed it! If you want to read more, here’s what we were talking to retailers about this year: http://bit.ly/2jSiWCC

 

 

 






Helping retailers optimize retail and unify commerce | #nrf17 

retail-pro-nrf-2017

 

Helping you optimize retail and unify commerce. That’s what we’re all about at Retail Pro.

Whether your focus for 2017 is to increase efficiency on the sales floor or back office, improve your customer experience, go mobile, go global, or go unified, we’d love to help you do it.

Request a demo today or visit us at NRF to share your story and see how Retail Pro can help you optimize your retail business.

NRF’s Big Show | January 15 – 17 | Retail Pro Booth #4025






Will we see you at #nrf17?

NY640

 

Hi there!

Just a couple days left until NRF’s Big Show! If you’re going, we’d love for you to come by our Retail Pro booth #4025 to say hello!

Until then, safe travels! See you soon!

Schedule an NRF meeting with Retail Pro

Here’s what you’ll see

You’ll see the modern, flexible Retail Pro retail management software that brands like Under Armour, Puma, Frye, Oakley, Samsonite, and L’Oreal use to increase efficiency in stores and across channels, create an awesome customer experience, and unify commerce – profitably.

These are just some of the Retail Pro capabilities that help you optimize retail. Come by our Retail Pro booth #4025 to see how Retail Pro can help YOU optimize your retail!

Learn more on our website
 


 
On the Sales Floor
 
In the Back Office
 
All Over the World
 
  On the Sales Floor   In the Back Office   All Over the World  
 
POS
Customer Mgmt
Employee Mgmt
Inventory Mgmt
 
Replenishment
Promotions
KPI Reporting
Multi-Subsidiary
 
Multi-Region
Multi-Currency
Multi-Language
Multi-Tax
 






How to create awesome customer experiences

Customer Experience_1

 

The experience you create in your stores and the way you treat your customers impacts how likely they are to shop with you again.

Find out how luxury luggage retailer Rimowa makes their customer experience awesome at every touchpoint. Then, book your NRF meeting to talk with us in person about how Retail Pro can help you create your customer experience!

Book my NRF meeting now

 






New year, new retail! 5 ways to use mobile in your stores

Mobility_1

 

Each new year comes with new excitement, new potential, new initiatives – like mobile in your stores!

Start 2017 off right – see how one fashion retailer uses mobile in their stores. Then, book your NRF meeting to talk with us in person about how Retail Pro can help you go mobile!

Book my NRF meeting now

 






How to Build Your Tech Strategy

Tech Strategy_2

 

Technology empowers efficiency in your retail operations, so building a solid tech strategy is critical to effective execution.

See how Earthbound Trading Co is increasing operational efficiency by building their tech strategy with Retail Pro.

Then – book your NRF meeting to talk with us in person about how Retail Pro can help you optimize your retail tech strategy.

Book my NRF meeting now

 

 






How to Expand Your Retail

Expand Retail_blog

 

See how one Retail Pro retailer is growing their operations and the 4 must-haves for retail expansion today.

Then – book your NRF meeting to talk with us in person about how Retail Pro can help you optimize your retail as you grow.

Book my NRF meeting now

 






How to Unify Commerce

Unify Commerce_Blog

 

Last week we invited you to meet with us at NRF to discover optimized retail with Retail Pro.

Let’s count down the final weeks before NRF with tips on HOW to optimize your retail operations, in step with market trends and proven strategies of retailers using Retail Pro.

Then – book your NRF meeting to talk with us in person about how Retail Pro can help you optimize and unify your commerce profitably.

Book my NRF meeting now

 






7 Retail Resolutions for 2017

iphone_notes

 

As 2017 quickly approaches, here are 7 New Year’s resolutions for retailers to consider.

 

1

I will think of and connect all our digital and physical channels as one whole so we can unify commerce.

2

I will use our retail data to plan inventory better so customers always get what they want and I always sell down to zero.

3

I will reach higher to grow my business, whether that’s expanding my merchandise, my team, my tech, or my operations – globally.

4

I will use my retail management tech to its full capacity to automate more and operate more efficiently.

5

I will leverage mobile POS to liberate my sales staff from bondage to the cash register, and empower them to better engage our customers and sell more with hyper-relevant data insights.

6

I will attend to my most important customers better and create a smooth and consistent experience however they choose to shop with our brand.

7

I will optimize retail.

 

 

Keep your 2017 resolutions with Retail Pro

 

Optimize-35

 

 

 

 

 

 






127

Countries

9000

Customers

54000

Stores

159000

Points of Sale

127

Countries

9000

Customers

54000

Stores

159000

Points of Sale

127

Countries

9000

Customers

54000

Stores

159000

Points of Sale