Are You Singing the Store Budgeting Blues?
Store budgeting is one of the biggest challenges of retail store managers. Regional retail chain managers don’t have it any easier. You have to plan your merchandise purchasing around buyer habits and seasonal predictions, allocate the right product to the right stores, make sure you hit your key performance goals and have a plan for when you don’t, and that’s just the beginning.
How do you manage it all? Here are 5 retail pro tips for managing your retail store budget so you can put the blues behind you:
- Get maximum visibility on every store – Visibility doesn’t just mean profits and losses. It also means transactional data at the point-of-sale (POS) level. In order to budget properly in retail, you need to know average sale per customer and other granular data that can only measure at the POS terminal.
- Set and monitor KPI targets – You need to be able to set realistic key performance targets. If you don’t know past sales volumes and transactions per customer, you can’t set proper KPIs. First, you track, then you set, then you monitor.
- Annotate key events – Numbers only tell a part of the story. What if you look back during the year and see that you have a day where sales were way off. Why did that happen? You need to be able to note specific events that influence the outcomes at every store. Allowing store managers to note when power outages occur, local community events that interrupt store sales, and even in-store events that might boost sales of particular items will give you better insight into what is impacting the bottom line at each store in your retail chain.
- Analyze the data – Collecting data and analyzing data are two different things. If you want to improve store performance, you’ve got to know what to measure and know what to do with the data you measure.
- Be flexible – Store managers and regional managers both need access to data, but they need different kinds of data. Your retail chain headquarters will require other types of data. Make your analysis and reporting tools flexible.
If you follow these key protocols, your retail chain and store budgets should be strong, and you’ll be done with the store budgeting blues.