How do you use retail sales metrics to identify and address performance gaps?

Retail sales metrics are key indicators of how well your store or team is performing, and how you can improve your sales strategy and customer experience. But how do you use them to identify and address performance gaps? In this article, we'll show you how to choose the right metrics, track them over time, compare them with benchmarks and goals, and take action based on the insights you gain.

1 Choose the right metrics

Not all retail sales metrics are created equal. Some are more relevant and actionable than others, depending on your business model, target market, and sales objectives. For example, if you sell high-end products with a long sales cycle, you might focus more on conversion rate and average order value than on foot traffic and basket size. To choose the right metrics, you need to consider what aspects of your sales process you want to measure, improve, and align with your overall goals.

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Brandon Luster

Store Manager at The TJX Companies, Inc.
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Well I think certain behaviors directly tue into some of those aspects especially to the higher end clients. So I might look at talent attraction and some retention as well.

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2 Track them over time

Once you have selected the metrics that matter most to your retail sales performance, you need to track them over time and see how they change. You can use various tools and methods to collect and analyze your sales data, such as point-of-sale systems, customer relationship management software, spreadsheets, or dashboards. The key is to track your metrics consistently and regularly, and to use the same time frames and criteria for comparison. For example, you might track your metrics daily, weekly, monthly, quarterly, or annually, and compare them with the same periods in the previous year or season.

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3 Compare them with benchmarks and goals

Tracking your retail sales metrics over time is not enough. You also need to compare them with external and internal benchmarks and goals, to see how you are performing relative to your industry, competitors, and expectations. External benchmarks are average or standard values for your retail sector or market, based on research or reports from reputable sources. Internal benchmarks are specific and realistic targets that you set for yourself or your team, based on your historical data, potential, and strategy. Comparing your metrics with benchmarks and goals helps you identify where you are doing well, and where you need to improve.

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Chris Gaglia

Certified Apple Technician
(edited)
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One thing to consider is that a metric can be out of proportion for a particular time period for particular reasons, and, as a result, it may not provide information that will be as useful for your teams current situation. Some factors include: - an employees health during a given time may impact their performance - a holiday that falls on a different day than the prior year impacts a year over year comparison - product availability changes during compared time periods - business practices change, meaning metrics may need to be examined differently. Taking numbers at face value can lead to unnecessary changes which impact your team. Digging deeper can help tell the full story and provide better, more actionable information.

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4 Take action based on the insights

The final and most important step is to take action based on the insights you gain from your retail sales metrics. This means using your data to inform your decisions, actions, and adjustments to your sales strategy and tactics. For example, if you notice that your conversion rate is low, you might need to improve your sales skills, offer more incentives, or create more urgency. If you notice that your average order value is high, you might want to leverage cross-selling and upselling opportunities, or increase your prices. Taking action based on your metrics helps you close the performance gaps and achieve your sales goals.

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5 Here’s what else to consider

This is a space to share examples, stories, or insights that don’t fit into any of the previous sections. What else would you like to add?

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Brandon Luster

Store Manager at The TJX Companies, Inc.
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I would also add that right person is key also. I'd look at the training and does it need to be unskilled to match today's clientele or associates. Then look at markups and roi then formulate the best plan of action.

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How do you use retail sales metrics to identify and address performance gaps?

1

2

3

4

5

1 Choose the right metrics

2 Track them over time

3 Compare them with benchmarks and goals

4 Take action based on the insights

5 Here’s what else to consider

Retail Sales

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How do you use retail sales metrics to identify and address performance gaps?

1

2

3

4

5

1 Choose the right metrics

2 Track them over time

3 Compare them with benchmarks and goals

4 Take action based on the insights

5 Here’s what else to consider

Retail Sales

Rate this article

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