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See benchmarks - and five year trend charts! - for the six key ratios every retailer must monitor. See how your store compares.
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Opening a store?
Adding stores?
RetailStartup.com
Opening a store?
Adding stores?
RetailStartup.com
Start now! Just $24.95/month
Total Access: Members-Only Collection
M2M |
On-demand, 24/7, whenever you need it.
All for just $24.95 per month.
GMROI & Turns Calculator
Key Ratios Calculator
Open-to-Buy (OTB) Calculator
Three major sections:
P&L and Balance Sheets; Inventory Buying Plans; Cash Flow
"Learn" in short, self-paced chapters
"Practice" (e.g., take a quiz!)
"Apply" to your own business
Case Study: The I. M. Surviving (?!) Co.
Plus much more!
Start Now!
Follow these 5 steps. Drive your inventory to a targeted, well-conceived ENDING INVENTORY level at the end of each month.
- Determine precisely what annual inventory turnover rate your store(s) should have to be profitable and provide an adequate cash flow. (For free guidance, find your segment under the "Retail Benchmarks" tab.)
- Next, convert that turnover rate into "days of supply"; i.e., 4.3 turns divided into 365 days in a year equals 85 selling days (of supply) or "one turn's worth of inventory".
- Now, simply guesstimate your reasonably expected sales volume for the 85-day period from April 1st forward, in this example, through June 24. Got it?
- That sales number now becomes your targeted inventory level (at retail, not cost) for the end of June. Now you've got a goal, a definitive number to shoot for which is based on going forward safely.
- But it's only as good as your ability to hit that target. Therefore, with just a limited number of selling days left before the end of June, you can, and must, reduce prices, cut orders, give spiffs to your staff...whatever it takes to drive down your inventory to hit that ending inventory goal. Now that you know what to do, we know you can do it.
And remember: Survival, without profit, through this recession is like halitosis; it's better than no breath at all!
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Retailers: Are You "In Decline"?!
Here are eight key indicators of decline in a retail business. Check to see where your operation fits for each one of them. Then tally it up: how many Stage Ones? Stage Twos? Any Stage Threes?
Remember, all retailers are in Stage One of decline at some point. The key is recognizing it, and making the necessary adjustments. This quick assessment will let you know where your operation might be at risk, and where you must focus your efforts first.
Being "in decline" is not the problem. But being in denial IS a problem!
(ROI Members can download a FREE copy of The ROI's 8-page Crisis Guide. Packed with proven, practical steps for retail turnarounds.)
Retailers: Are You "In Decline"?!
Here are eight key indicators of decline in a retail business. Check to see where your operation fits for each one of them. Then tally it up: how many Stage Ones? Stage Twos? Any Stage Threes?
Remember, all retailers are in Stage One of decline at some point. The key is recognizing it, and making the necessary adjustments. This quick assessment will let you know where your operation might be at risk, and where you must focus your efforts first.
Being "in decline" is not the problem. But being in denial IS a problem!
(ROI Members can download a FREE copy of The ROI's 8-page Crisis Guide. Packed with proven, practical steps for retail turnarounds.)
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| How-To Articles for Retailers from The ROI
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Recession? Don't Be a Victim This recession is like quicksand for retailers. If you don't keep moving, it could take you down! The key to surviving the recession is to be pro-active. Here are five key areas to focus on right now. Make sure that your stores are out in front, leading the pack, as you pursue the difficult changes that are demanded. read more ... |
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Retailers: Game Plan for a Turnaround In good times, inventory turnover is important; in bad times, it is critical. Higher turns mean that fresh, new merchandise will represent a greater proportion of your total merchandise (something customers love!). And it will reduce your dependence on borrowed money by trimming down inventory. read more ... |
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Recession? Don't Be a Victim This recession is like quicksand for retailers. If you don't keep moving, it could take you down! The key to surviving the recession is to be pro-active. Here are five key areas to focus on right now. Make sure that your stores are out in front, leading the pack, as you pursue the difficult changes that are demanded. read more ... |
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Retailers: Game Plan for a Turnaround In good times, inventory turnover is important; in bad times, it is critical. Higher turns mean that fresh, new merchandise will represent a greater proportion of your total merchandise (something customers love!). And it will reduce your dependence on borrowed money by trimming down inventory. read more ... |
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The Members-Only Collection
The Members-Only Collection
| Six-Step Recovery Program for Your Store Having problems meeting your bank loan? You’re not alone. Even the superstars of retailing seem to be having troubles these days. And they have enough assets to make your head spin. read more ... |
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| Six-Step Recovery Program for Your Store Having problems meeting your bank loan? You’re not alone. Even the superstars of retailing seem to be having troubles these days. And they have enough assets to make your head spin. read more ... |
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| MORE Tools & Resources in the Members-Only Collection
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Now. Learn Basic Retail Finance. At your own pace. 24/7.
Profits & Debt Management - Financial Statements - P&L's - Balance Sheets - Inventory Management (@Cost or @Retail) - Turnover - Buying Plan Budgets - GMROI - Cash Flow - pro formas - Ratio Analysis -
Integrated Retail Financial Plans
The ROI's Online Seminar on Retail Finance Basics is an interactive, self-paced course. By retailers, for retailers. "All it takes is a little desire."
- Learn how the income statement and balance sheet must work together.
- Learn how to do inventory buying plans (Open-to-Buys) at either cost or retail.
- Learn how to do a retail cash flow, one that reflects your buying plan.
Includes interactive content, self-quizzes, printable worksheets, extra how-to articles by retail experts, and a special case study featuring Helen and Irving Surviving of The I. M. Surviving(?!) Company.
Take a Feature Tour 
Feature Tour opens in a separate, pop-up window. Please disable pop-up blockers.
No retailer really wants to pay for bookkeeping or accounting. But it's necessary for two reasons: (1) to accurately satisfy the I.R.S.; (2) to accurately show where the business has been and where it is now.
This second reason is essential for what REALLY matters: doing better in the future!
The ROI has developed The Screening Test for Retail Bookkeepers. As an ROI Member you may download a free copy of that test to use as you interview prospective bookkeepers.
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Tough Balancing Act
Buying merchandise successfully is both an art and a science. The art of it is what makes retailing so exciting, and attracts so many entrants. It's also what frequently brings exuberance and over-buying.
Ah, that's why "successful" buying includes the science component. Open-to-Buy budgeting is a science...and equally as vital as the art of buying.
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Retail Owners...
Need a New Strategy?
Customized • Timely • Objective
(more info...)
Retail Owners...
Need a New Strategy?
Customized • Timely • Objective
(more info...)
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