Key Performance Indicators for Retail (KPI)

Let's face it, retailers are busy.  So busy in fact, that many don't spend the time required to run reports and analyze their business's performance.

This is a big mistake, but it's not hard to fix.  Running reports doesn't have to be a huge time commitment every day, week, or month.  It DOES however HAVE TO BE DONE!  If you're not running reports and analyzing your business, you're almost certainly wasting time, money, and losing sales.

So, what reports should you be running?  The trick is to identify the most relevant parts of your business to your profitability, and the develop a few Key Performance Indicators (KPI) that will give you a clear picture of your business's performance without having to wade through tons of data.

Typical retail KPIs are things like:

-Total Sales

-Sales Per Hour

-Average Sale

-Inventory Turn

-Average Gross Margin

-Customers per day/week

-Items per customer

There are many more, including financial or customer centric indicators that you can use once you have a grasp on the above.

By monitoring these KPIs, and then making changes such as adding new types of stock, new marketing campaigns, or reorganizing your displays, you can compare your KPIs before and after to see if your sales have gone up or down, and why.

This is extremely powerful stuff and you owe it to yourself and your business to set aside a few minutes a day to look at these metrics, it can make a huge difference in your performance and the performance of your store.