There are 2 fundamental things to get right when discounting stock. (Quite amazing considering all the mistakes you see around the traps.)
Pick the right product!
Choose products with high elasticity. An increase in price would result in a decrease in revenue, and a decrease in price would result in an increase in revenue. Typically, [...]
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Some stats for the retail geeks out there
Typical Stockturns: Specialty Retailers
Dairies » 95 x
Butchers » 60 x
Newsagents » 9 x
Chemists » 7 x
Fashion » 6 x
Hardware » 4 x
Jeweller » 2 x
Filed under: Finance, Merchandising, Productivity, Retail Operations | Tagged: Stockturns | 2 Comments »
Managers often refer to the measured outputs of a sales associate (or any employee) as Key Performance Indicators, or KPIs. That is, outcomes are measured in terms of key performance indicators.
Typical KPIs for retail sales professionals usually include:
Total sales
Sales Per person
Sales [...]
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I used Discounted Cash Flow (DCF) for many years without actually understanding it. I am sure there are many people who are a bit scared of really testing their understanding of DCF in public, so herewith a simple DCF for Dummies.
DCF is a valuation method used to estimate the attractiveness of an investment opportunity. It [...]
Filed under: Finance, General, Management, Retail Operations | Tagged: Cash Flow | No Comments »
A few truisms about PRICE are in order:
Nobody likes to have to or indeed wants to buy the ‘cheapest’ – and for a wide range of products, consumers actively avoid the ‘cheapest’.
Continuous discounting has the effect of raising customer expectations for even bigger discounts in the future. (Weber’s law about perceptual thresholds apply.)
When given an [...]
Filed under: Customer Service, Finance, General, Marketing, Risk Management, Selling, Strategy | 1 Comment »
