RETAIL KEY PERFORMANCE INDICATORS (KPI s)
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1 RETAIL KEY PERFORMANCE INDICATORS (KPI s)
2 What KPI s Must Do - Provide Purpose What gets measured gets done - Provide Consistency KPI system must not constantly change - Provide Ownership Only include KPI s that the person can control - Provide Clarity KPI s must be intelligible - Provide Direction KPI s must highlight the priorities of the company - Provide Orientation Use the same KPI system for all stores to allow for comparison - Provide Motivation KPI targets should motivate and thus achievable targets must be set
3 Some KPI s Retailers Use Sales Cost - Like for like sales - Wage cost against budget - Sales against target - Transaction Value Number People Stock - Mystery Shop Customer Feedback - Category performance - Attendance - Stock Hold & Loss Out of stock - Conversion Rates - Sell Through - Net Promoter Score - Brand performance (margin) Store - Standards - Presentation Compliance
4 Questions You Should Ask? - Should sales be used as a target what about average transaction values and conversion instead? - Should KPI s be customer facing i.e. front of house versus back of house? - How influential are staff behaviours on your sales, atv, ipc and loyalty? - How influential is labour availability on conversion rates and atv? - What happens with underperforming stores?
5 Answers - Should sales be used as a target what about average transaction values and conversion instead? Sales can be too vague a target...atv and conversion offers greater guidance as to what to do workshop it - Should KPI s be customer facing? Yes Too often KPI s include matters which do not drive sales and service productivity they distract people - How influential are staff behaviours on your sales, atv, ipc and loyalty? In full-serve Environments they are crucial - How influential is labour availability on conversion rates and atv? There is a direct correlation between labour scheduling and conversion in fullserve retail environments - What happens with underperforming stores? Too often nothing happens intensive care process?
6 Driving ATV & Conversion Workshop ATV CONVERSION - Behaviours - Dual Packs - Promotions - In-store POS - The Till - Baskets - Changing room garments - Behaviours - Call to action - Perception of value - Impulse items - Queue management - Returns policy - Multiple till locations
7 BUILDING CUSTOMER FACING KPI S
8 Retail Sales Flow
9 YOUR KPI S SHOULD BE BASED ON - THE IMPORTANCE OF EACH METRIC IN THE RETAIL SALES FLOW TO YOUR COMPANY - THE METRICS WHICH ARE CONTROLLED BY THE STORE MANAGER
10 Input & Output KPI s INPUT Pet Behaviours (Service) Offer (Product at a Price) Fashion Sports OUTPUT Jewellery Pharmacy ATV (Average Transaction Value) Electrical Conversion (% of footfall that Furniture buys) Entertainment Labour Modelling (Availability of staff) In-Store Cues Forecourt Grocery (Store Standards, Environment, POS)
11 IMPORTANCE OF EACH METRIC TO YOUR COMPANY FORECOURT FASHION Critical Pharmacy Pet THE OFFER Jewellery BEHAVIOURS Fashion LABOUR Sports INSTORE CUES Electrical Furniture Entertainment INSTORE CUES Forecourt LABOUR BEHAVIOURS Grocery THE OFFER Ancillary Self-Serve Retail Model Full-Serve
12 A brief exercise Please rate the importance of the following on the retail sales performance in your store - Staff Behaviours - The Offer (the product at a price) - Labour Modelling (availability of staff) - In-store Cues (Store standards, environment, pos)
13 IMPORTANCE OF EACH METRIC TO YOUR COMPANY FORECOURT FASHION Critical Pharmacy Pet THE OFFER Jewellery BEHAVIOURS Fashion LABOUR Sports INSTORE CUES Electrical Furniture Entertainment INSTORE CUES Forecourt LABOUR BEHAVIOURS Grocery THE OFFER Ancillary Self-Serve Retail Model Full-Serve
14 THE METRICS WHICH THE STORE MANAGER CONTROLS FORECOURT FASHION Control Pharmacy Pet THE LABOUR OFFER Jewellery BEHAVIOURS Fashion INSTORE Sports CUES INSTORE CUES Electrical Furniture BEHAVIOURS Entertainment LABOUR Forecourt No Control THE OFFER Grocery THE OFFER Self-Serve Retail Model Full-Serve
15 Explaining Behaviours
16 Retail Behaviours (full-serve environment) Acknowledgement Proactive Offer of Help Qualifying Product Knowledge Product Recommendation Link-Sale Closing
17 IMPORTANCE OF BEHAVIOURS Critical Pet Footwear Jewellery Pharmacy Fashion Telco Important Sports Home Gift Electrical Furniture Entertainment Forecourt Ancillary Discount Grocery Low Customer Lifetime Value (ATV, Loyalty, Expectation) High
18 A SIMPLE KPI TARGET SHEET
19 STORE - DOUGLAS VILLAGE OCT 2013 TARGET OCT 2013 ACTUAL OCT 2013 ACTUAL % WEIGHTING INPUT KPI'S Behaviours % 88.00% 88.00% 20.00% Wage Cost (Labour Modelling) 10.00% 11.00% 91.00% 20.00% Store Standards % 93.00% 93.00% 20.00% OUTPUT KPI'S Average Transaction Values % 20.00% Items Per Customer % 20.00% TOTAL AVERAGE % ACHIEVED FOR THIS STORE IN OCT %
20 MEASURING BEHAVIOURS
21 BEHAVIOURS LADDER few minutes of arrival. There LADDER ACKNOWLEDGEMENT OFFER OF HELP QUALIFYING KNOWLEDGE RECOMMENDATION UPSELLING CLOSING 1 The customer was not acknowledged as they enter the store or during the first were no staff members to be seen in the store for the first minutes or so. The customer was not acknowledged as they enter the store or during the first few minutes of arrival. There were no staff members to be seen in the store for the first minutes or so. There were no staff members on the store floor to approach. There were all back of house. The customer waited for a suitable period of time to be proactively offered help but was not. There was no interaction to allow qualifying questions to be asked. VOID Staff member knowledge was not checked as there were no staff members available on the store floor. There was no staff member available to make a recommendation. There were no staff members available to link sell or up sell. There were no staff member available to close the sale. 2 There was no acknowledgement of the customer as they entered the store or Staff were on the shop floor and were not busy but no proactive offer of help was during the first minutes of arrival. The staff members were towards the back of the given. store and were oblivious to customers in the store. The staff member did not ask any questions. The standard of product knowledge was non existent. The customer was taken aback with the complete lack of knowledge. No product recommendation was made. The customer was left to decide for themselves. No effort to link sell/ upsell. It was not even considered by the staff member. There was no effort made to close the sale. The customer was left to their own devices. 3 4 There was no acknowledgement of the customer as they enter the store or during Staff were on the shop floor and were task orientated but no proactive offer of help the first minutes of arrival. Staff were task orientated and not customer focused. was given. There was no acknowledgement of customers as they enter the store or during The store was moderately busy and staff were dealing with customers. However, the first few minutes of arrival. The store was moderately busy. Staff were dealing proactive offer of help could have been given in a timely manner. None was with other customers. However, there was an opportunity as the staff member received. traversed the store (for example) to acknowledge the customer. The staff member asked a couple of question but not enough to qualify what the customer really wanted. The staff member asked questions but the questions asked didn't establish exactly what the customer required. UNDER PERFORM The standard of product The staff members standard of knowledge was poor but the tried to bluff their way Although a selection of products were presented by the staff member they did not by giving the incorrect information to customer. They didn't read instructions or identify an exact product as a solution. tried to attain the correct information. knowledge is average. It does not meet the expectation of the The staff member's standard of knowledgeable was poor but they made an effort to advise the customer by going online, by customer. reading the side of the box or reading A The tentative product customer recommendation was made by the staff was member. However the the usage instructions on the product. The recommendation did not breed customer did not have confidence in the recommendation. confidence in the customer. underwhelmed by the standard of product knowledge. AVERAGE No effort to link sell/ up sell was made. The staff member came across as rushed and indifferent to suggestion a complementary, more expensive product. No effort to link sell/ up sell was made. The staff member came across as being lacking in ability/knowledge to suggest a complementary or a more expensive product. There was an effort made to close the sale but it was awkward and ineffective. There was an effort to close the sale but it was mechanical and uninspiring. 5 There was no acknowledgement of customers as they entered the store or during A minimum number of questions were asked but key questions were missed. The The staff member made a product recommendation. The staff member was No proactive offer of help was made because the store was very busy and staff The staff members standard of knowledge was poor but the found another staff the first few minutes of arrival. The store was very busy and staff members were staff member did grasp what the customer required but important background confident in their recommendation. However, their recommendation did not seem were preoccupied with customers. member what could correctly advise the customer. very busy with other customers and queues. information was missed. No rapport was made with the customer. credible! An effort to up sell and link sell was made but the attempt came across as mechanical and unfounded. The staff member asked for the sale by asking if the customer was happy with the suggested product. 6 Eye contact was made by staff members but it was cold and unwelcoming. A proactive offer of help was given but the offer was rushed and not appropriate. The standard of product knowledge is average. It does not meet the expectation A standard number of questions were asked. There was no real extra effort made The customer felt that they are a distraction to the staff member. They felt of the customer. The customer was underwhelmed by the standard of product to build a rapport or to really qualify what the customer required. unvalued. knowledge. The staff member made a product recommendation. The staff member was confident in their recommendation. However, when the staff member was questioned further their replies left the customer unconfident in their recommendation. An effort was made to up sell and link sell was made but the attempt was timid and The staff member suggested that there was limited stock available and that this weak. product was a suitable solution. PERFORM A proactive offer of help was given. Staff were friendly and the offer of help was Eye contact was made by the staff member and perhaps a nod - the gesture was A substantial number of questions were asked but the quality of questions asked suitable. However, the offer of help was delayed and should have been made warm and welcoming. was poor and did not establish the exact needs of the customer. sooner. Substandard oral acknowledgement was made. The customer was greeted but it An offer of help was made in a friendly, timely and suitable manner. The customer Good insightful questions were asked. A good effort was made to establish what felt like a distraction for staff. felt welcome in the store. the customer required. Very good, insightful questions were asked. The staff member made a good effort A good proactive acknowledgment was made. The customer felt welcome to the The offer of help was very friendly and timely. Very positive interaction was made. to find out what the customer really required and built a good rapport with the store. The customer felt very welcome to the store. customer. The standard of product knowledge was good. The staff member was knowledgeable but was limited in their ability to communicate their knowledge with the customer. The standard of product knowledge was good and the staff member was a good communicator. They were engaged and helpful. The customer felt pleased with the information received. EXCEED The standard of knowledge was very good. The staff member was engaged and communicated clearly about the subject in question. The customer was confident in the information that they received from the staff member. The staff member made a product recommendation and backed it up with knowledge but could have been more passionate and convincing. The staff member made a product recommendation. They came across as credible and knowledgeable. The staff member made a product recommendation and they were very convincing in their conviction and did breed confidence in the customer. The staff listed the benefits of the product to the customer and reiterated The staff member that the product in question made was suitable. a passionate attempt to link sell or An attempted was made to upsell and linksell. The recommendation seemed credible. An up sell and link sell was attempted. The suggestion was credible but lacked The staff member created a real sense of urgency thus encouraging the customer up sell on this occasion. Their urgency. to purchase the product. passion was infectious and their intelligence and credibility forced a link sell / up sell. The staff member was passionate in their link and up sell suggestion. They impressed the customer but the customer could take it or leave it. The staff member put the product in the customers hand and escorted them to the counter. They asked for the sale. 10 Excellent, knowledgeable and probing questions were asked. The staff member Excellent proactive acknowledgment was made. The staff member made good, The offer of help was extremely friendly and timely. The customer found it very The standard of knowledge was excellent. The staff member amazed the went to great lengths to find out what the customer really required and built a good warm eye contact and gave a friendly welcome. The customer felt valued and very personal and the interaction to be very positive. They felt like a treasured customer and they were engaged and passionate about the subject in question. rapport with the customer. The staff member had a comprehensive understanding welcome to the store. customer. The went above and beyond the expectations of the customer. about the needs of the customer. The staff member's enthusiasm about the product was infectious and convincing. The staff member made a product recommendation with such intelligence e and The staff member made a passionate attempt to link sell or up sell in this occasion. They put the product into the customers hand and pointed out the positive aspects passion that the customer was extremely confident I the product recommended Their passion was infectious and their intelligence and credibility forced a link sell/ of the recommended product. They asked for the sale. They escorted the and had no hesitation in purchasing the product. The recommendation up sell. customer to the counter reiterating the good choice made and commended the demonstrates credibility and authority. customer of their excellent choice.
22 - Mystery Shopping - Customer Feedback Card - In-store - Online with reward - Exit Interviews
23 RETAIL BEHAVIOURS Q3 YOUR COMPANY Versus PHARMACY SECTOR
24 Q3 COMPANY VERSUS SECTOR - RETAIL BEHAVIOURS Acknowledge Help Qualifying Knowledge Recommend Link Sales Close Your Company Behaviours All Pharmacy Sector Behaviours All Independents Behaviours All Multiples Behaviours Boots Behaviours Your Company Behaviours All Pharmacy Sector Behaviours All Independents Behaviours All Multiples Behaviours Boots Behaviours Acknowledge Help Qualifying Knowledge Recommend Link Sales Close
25 MEASURING STORE STANDARDS
26 Standard Required Section 6: Display Standards Must Haves (three points per standard) Do all floor rails carry display ends and price messaging Are all stock items visibility ticketed Are all hangers size cubed Are all folded items neat and fully recovered Should Haves (one point per standard) Are there at minimum five front facing co-ordinated suit ranges Are floor models neat, co-ordinated and in proximity of range Are trouser rails neat and tidy Do rails offer a 6 inch gap for ease of selection Yes No Comments Total Score Available 16 Total Score Achieved %
27 STORE WORKPLAN DAILY CHECKLIST MON TUE WED THUR FRI SAT SUN Exterior Set-up JOHN JOHN MARY JOAN JOAN KATE KATE Please ensure store windows and entry doors are presentable and clean Please ensure that all window display areas are clean and dirt free Please ensure that the front doors are open during trading hours Please ensure there are no hand written signs in the window Please ensure there are no non-corporate signs in the window Please ensure that the store opening hours are clearly displayed
28 THANK YOU Ennis Office - 1 Barrack Street, Ennis, Co. Clare Dublin Office Fitzwilliam Square, Dublin 2 T: 353 (0) F: 353 (0) E: info@retailexcellence.ie W: retailexcellence.ie
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