The numbers on your pay cheque aren’t the only ones that matter if you work in the retail industry.
Whether you’re a part-time Sales Associate or a full-time Manager, these performance metrics will tell you a lot about your personal and your store’s success—and if you’ll be getting those extra hours next week.
Total personal sales
Total personal sales ($) = sale 1 ($) + sale 2 ($) + …
Arguably the most important performance metric for an associate is total sales, or the dollar amount sold during every shift worked. Often, there’s a minimum amount you should sell based on the number of hours you’ll be working and how busy it’s expected to be.
This amount is a benchmark, but don’t stop selling once you reach it. Know your target before you hit the floor and periodically track your progress throughout the workday. Do your part to help your store achieve its daily sales goal.
Average dollars sold per hour worked
Average dollars sold per hour worked = total sales ($) ÷ hours worked
This calculation measures productivity on an hourly basis. It tells management who the store’s top performers are on a weekly, monthly, quarterly or yearly basis.
Managers are looking to see a consistent (if you’re maintaining the store’s benchmark for this metric) or an improving performance. A decline in your average dollars sold per hour worked means that you might not be working as hard as you should be.
Average dollars (or items) per sale
Average dollars per sale = total sales ($) ÷ number of sales
Average items per sale = total items sold ÷ number of sales
Retailers are hoping to dig as deep into their customers’ pockets as possible. So if you’re not asking people if they’d like athletic socks to wear with their new athletic shoes, you should definitely start.
The process of getting your current clients to spend more is called up-selling. Managers will monitor an associate’s average dollars (or items) sold per sale to ensure that you’re always getting the most out of every transaction.
Gross margin (%)
Gross margin (%) = [retail price ($) – store cost ($)] ÷ retail price ($)
If your store offers promotions like buy one get one half price and excludes some items from the sale, this might be why: it may not be profitable for the store to discount certain products.
Managers and executives are interested in the store’s gross margin percentage metric because it measures profitability. If your store is part of a publicly traded company, gross margin is especially important for investors since it speaks to a company’s efficiency and grow prospects.
Inventory shrinkage (%)
Inventory shrinkage (%) = [(recorded inventory ($) – actual inventory ($) ÷ actual inventory ($)] x 100
During a store inventory audit, the number of items on the sales floor and in the stock room is manually counted and recorded. Shrinkage is the term that accounts for inventory that’s on the books but isn’t actually on-hand because of employee theft, shoplifting or administrative error.
Shrinkage might not be as important for part-time staff as it is for full-time managers. But it takes a bite out of your store’s bottom line and that’s why it matters. To make up for lost sales, your company might raise prices or cut staff. You could be the person they let go to offset the cost of missing inventory.
How do you measure your performance at work? Share your tips in the comments section below!
Photo credit: Mark Hillary