Core Retail - Strengthen the Basics

Transcription

1 Core Retail - Strengthen the Basics Presented by: Becky Wilkins Retail Management Associates AGM Education Team The Educational Voice in Golf Merchandising Since 1989 All AGM educational materials are protected by U.S. Copyright and cannot be reprinted or used without the expressed written consent of the Association of Golf Merchandisers.

2 Core Retail Strengthen the Basics Becky Wilkins Retail Management Associates AGM Education Team All AGM educational materials are protected by U.S. copyright and cannot be reprinted or used without the express written consent of the Association of Golf Merchandisers Core Retail Strengthen the Basics The goal of this course is to: Review and Define your facility personality Define Core Retail Principals Institute monthly Best Practices in Financial Planning Service Standards Visual Expertise Make your golf retail operation more successful! Review and Define Your Facility Personality 1. What is the personality of your facility? 2. How do your vendors fit your facility? 3. How does your facility personality affect your inventory planning? 1

3 What is the Personality of Your Facility? What type of facility do you have? When is your store/club open? What is your customers average age/income? What are your customers merchandise preferences? Does your weather affect what you sell? How Do Your Vendors Fit Your Facility? Questions to ask about vendors : Do they offer the right product? Are they financially stable? Can they ship on time and complete? Do delivery dates fit your selling season? Are re orders available? What about return policies? Will they provide assistance with problems? Are they available for trunk/fashion shows, training for staff? Know Your Customer s Preferences and Your Target Market Opening price points Moderate price points Upper price points 2

4 How Does Your Facility Personality Affect Your Inventory Planning? When is your selling season? When are goods delivered? 1. Plan receipts one month prior to your planned sales 2. Use previous sales records for planning 3. Stagger arrivals throughout the season What Are the Dangers of Frontloading Inventory? Depletes cash Occupies valuable selling space Impossible to have always fresh merchandise Difficult to replace best sellers Difficult to cancel merchandise not selling Physical Inventory A physical inventory count is one of the most important aspects of merchandise control, stock planning and profit. How often do you take physical inventories? 3

5 What Will a Proper Physical Inventory Accomplish? Allow you to maintain a book inventory Identify areas of shrinkage Create accurate reports Forecast the future Identify best sellers Identify dogs Creating Merchandise Departments/Classifications During this segment we will be concentrating on: 1. Why create merchandise classifications? 2. What are the 4 basic merchandise departments? 3. What are the most common classifications in these departments? Total Store Hierarchy Department Classification Sub Classification Line Item SKU 4

6 What Are the Four Basic Merchandise Departments? 1. Equipment 2. Golf Accessories 3. Men s Apparel 4. Women s Apparel Why Create Merchandise Departments & Classifications? 1. Provide record of historical data 2. Provide a guide for future planning 3. Determine profitability by similar product types 4. Allow allocation of dollars in specific categories What Are the Most Common Classifications for Equipment? Woods Irons Putters Wedges 5

7 What Are the Most Common Classifications for Golf Accessories? Gloves Accessories Shoes Balls Bags Headwear What Are the Most Common Classifications for Men s Apparel Shirts Sweaters Slacks Shorts Outerwear What Are the Most Common Classifications for Women s Apparel Shirts Sweaters Slacks Shorts Outerwear 6

8 Creating Merchandise Sales Reports by Department What, if any, sales reports do you use in your business? Weekly Sales Reports (By Day, Department and Classification) Monthly Sales Reports (By Department and Classification) Core Retail Principals: Retail Math Definitions, Calculations and Examples During this segment we will focus on: 1. Cost of Sales 2. Gross Profit 3. Dollar Per Round 4. Dollar Per Square Foot Cost of Sales in Dollars What is Cost of Sales in Dollars? Answer: The dollar amount it costs to create sales revenue for any specified time periods or product. 7

9 How is Cost of Sales in Dollars Calculated? Beginning Inventory $75,000 + Receipts for the Month $ 8,500 = Adjusted Inventory $83,500 Month end Inventory $72,850 Difference $10,650 or Cost of Sales in Dollars How to Convert Cost of Sales in Dollars to a Percentage: Divide Cost of Sales by Retail Sales: Cost of Sales $10,650 Divided by Retail Sales $22,500 = Cost of Sales Percentage 47% Gross Profit What is Gross Profit? Answer: The dollar amount of profit generated for a single item or specified time period for the entire shop. 8

10 How is Gross Profit Calculated? Retail Sales for the Month $22,500 Cost of Goods Sold $10,650 = Gross Profit $11,850 How to Convert Gross Profit to a Percentage: Gross Profit $11,850 Divided by Retail Sales $22,500 = Gross Profit Percentage 53% Summary of Sales and Profits Cost of Sales $10,650 (47%) Gross Profit $11,850 (53%) Total Sales $22,500 (100%) 9

11 Industry Benchmarks Gross Profit From the AGM 2011 Member Survey: Type of Facility Gross Profit Private 30.3% Public facility 30.7% Resort 43.2% Off course stores 38.3% Dollar Per Round What is Dollar Per Round? Answer: The amount of revenue generated in retail sales as compared to the number of rounds of golf played. How is Dollar Per Round Calculated? Total Revenue $22,500 Divided by Number of Rounds Played 1500 = Dollar Per Round $15 10

12 Industry Benchmarks Dollar Per Round From AGM 2011 Member Survey: Private $17.65 Public $ 9.97 Resort $28.40 Dollar Per Square Foot What is Dollar Per Square Foot? Answer: The amount of revenue generated as a factor of square footage in the store. How is Dollar Per Square Foot Calculated? Total Revenue $270,000 Divided by Floor Sales Space 850 square feet = Dollar Per Square Foot $317 11

13 Industry Benchmarks Dollar Per Square Foot From AGM 2011 Member Survey: Private $ Public $ Resort $ Off course $ Institute Monthly Best Practices to Make Your Golf Retail Operation More Successful! Financial Planning Service Standards Visual Expertise Financial Planning Print & Review inventory and sales reports by department and classification Begin tracking sales progress by week and by month Calculate your Cost of Sales for 2011 and begin to track by month Calculate your Gross Profit for 2011 and begin to track by month Calculate Dollar per Round daily Calculate Dollar per Square Foot for 2011 Outline your goals for

14 Sales & COS Monthly Report Equipment Accessories Men's App Ladies App Total Beginning Inventory 15, , , , , Purchases 6, , , , , Adjusted Inventory 21, , , , , Ending Inventory 18, , , , , Cost of Sales 3, , , , , Sales at Retail 4, , , , , Cost of Sales % 80.00% 70.00% 68.00% 65.00% 69.94% Sales & COS Monthly Report Monthly Sales and Inventory Analysis elements: Beginning Inventory Purchases Sales at retail Ending Inventory Sales & COS Monthly Report Quick facts and review hints: Input sales and inventory numbers as soon as they are produced and reports printed don t put aside to get back to. Start next months analysis with beginning inventory as soon as you input ending inventory in current month they are the same. Keep a recap of invoices processed each month to complete the purchases column. This can be as simple as a copy of each invoice sent to accounting, an excel spreadsheet or a list of which invoices accounting paid (G/L listing by department). Print a completed copy and post on an easily visible board and keep a binder including each month for easy reference great planning tool for budgets for the next year. Read the results and compare to previous months! 13

15 Sales & COS Monthly Report Equipment Accessories Men's App Ladies App Total Beginning Inventory 15, , , , , Purchases 6, , , , , Adjusted Inventory 21, , , , , Ending Inventory 18, , , , , Cost of Sales 3, , , , , Sales at Retail 4, , , , , Cost of Sales % 80.00% 70.00% 68.00% 65.00% 69.94% Service Standards Personal Etiquette & Conduct Customer Greetings In Shop On Phone Sales Procedures Beginning to end Product Knowledge Appearance & Grooming Keep busy and out from the counter Proper uniform and grooming Service Standards Shop Standards Cleanliness Regular vacuuming Window & washing Fixture organization and cleaning Merchandise Standards Stock procedures & fill in Signage procedures 14

16 Visual Expertise Layout and Presentation Presentation Standards Creativity Incorporating Technology Visual Layout & Presentation Store Layout Grid Free Form Visual Layout & Presentation 15

17 Racetrack Visual Layout & Presentation Presentation Standards Create Standards for Visual Presentations Cohesive presentation Balanced height and weight Incorporate props and photos Create a Policy for frequency of changes Key areas weekly or more often Basics every other week with store rotation Floor layout seasonally Visual Impact Achieved with Standards of Presentation Bandon Dunes Resort 16

18 Inspire Creativity With Display Harbour Town Golf Links Embrace Technology in Display The Coeur d'alene Resort Core Retail Strengthen the Basics Review your facility personality Review Core Retail Principals Institute monthly Best Practices in Financial Planning Service Standards Visual Expertise Make your golf retail operation more successful! 17

19 Presented by: Becky Wilkins Retail Management Associates Retail Buying Consultant AGM Education Team (541) Association of Golf Merchandisers