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How to answer "Why Should we hire you? " - Interview Tips

 Why Should we hire you?  Why should we hire you is another one of the most important job interview questions asked in the interview and if you are not prepared for this question well in advance then it will be the toughest. So prepare the answer beforehand. To answer this question then you should have a good understanding of the key requirements of the job. To answer this question you should highlight what makes you a perfect candidate for this specific job opportunity. Describing the selling points relevant to the job such as job experience, industry experience, technical skill and company cultural fit will ensure your success in getting this job opportunity. If the job opportunity requires a change in industry or career, you should convince the interviewer that your experience and background will match the new role. This has to be done i f your experience does not match directly with the job. And if the job candidate has little or no experience then you should convince the ...
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9 Important Key Performance Indicators In Retail - RETAIL KPI's

Key Performance Indicators In Retail - 
RETAIL KPI's


Key Performance Indicators

KPIs are the measurable indicators that are used to gauge how well a business unit or organization is performing.

Important KPI's in Retail:
  1. Sales FTD/WTD/MTD/YTD
  2. Bills Generated
  3. Entry or Walkins
  4. Quantity Sold
  5. Conversion
  6. Average Bill Value - Also called ABV
  7. Items Per Cash Memo or Units per Transaction (UPT)
  8. Average Selling Price
  9. Sales Per square feet - SPSF
1. Sales Achievement can be measured on daily basis i.e. FTD (For the Day), or it can me WTD week till date, or it can be MTD and YTD i.e Month Till Date and Year Till Date

WTD Sales - Sales usually considered from Monday to Sunday
MTD Sales - 1st of the month to the end of month i.e. 30/31st of the month
YTD sales - 1st April of the financial year to 31st March of next financial year

Sales Achievement is calculated with the below-mentioned formula

Sales Ach = (Actual Sales/Actual Target)*100

Actual Sales is 85 lakhs
Target is 100 lakhs then 
Sales Ach = 85/100*100 = 85%

2. Bills Generated or Bill made: Bills are the total number of customer purchase happened during a specific period of time. Again Bills generated can be WTD,MTD and YTD

3. Entry or Walkins: Th number of customers coming to the store or visiting the store for purchasing or enquiring about products are called Entry or Walk-ins. These are calculated by the security at the entrance of the store. The security will be counting each and every customer entering the store and he will be recording the number of footfalls on an hourly basis in the register. Also in most retail stores, the automated counting machine notes done the number of people entering a particular retail store.

4.Quantity Sold: It is one of the most important KPI in retail because the higher the qty you will sell in the store, the higher will be your sales. This is also an independent KPI just like Sales, Walkins and bills generated. One interesting fact - In the apparel industry, during the new season sale or new product launch, the MRP or price of the merchandise is very high so the quantity sold will be less. But in End of Season sales as the price would be reduced so the quantity sold would be very high.

5.Conversion: It can be defined as the percentage of people purchasing in your store against the people coming/entering in your store. The formula to calculate conversion is:
 
Conversion = (Number of Bills/Number of Walkins)*100

For Example: Consider that 100 customers are entering your store and in that, 25 customers are purchasing or they are billing in your store:
Now the Conversion = (25/100)*100 = 25%
Here the conversion is 25%

Typically the healthy conversion rate in standalone stores is around 45% and in Mall stores, it will be 25% to 30% based on the store format. Conversion can be increased by providing good customer service, taking the customer feedback and resolving the customer issues, and by attending to each and every customer in-store. 

6. Average Bill Value(ABV) - Also called Average Transaction Value. It is the average value of the bills(in Rupees) in the given period of time.
The formula to calculate the ABV is mentioned below:

Average Bill Value = Total Sales/Total Bills Generated

For Example: Consider the sales done by the store is Rs 100000 in a day and the bills generated are 20 in that particular day, here the Average BIll Value will be Rs 5000. i.e ABV=100000/20 = Rs 5000

Now let us consider that the store generates the business of Rs 7500000 and to do 75 Lakhs the bills generated are 4500 in a month.
Now ABV = 7500000/4500= Rs 1666/- for the month

The ABV will differ from format to format:
ABV in Apparel Store will be Rs 4500 to Rs 5000
ABV in FMCG Store will be Rs 2500 to Rs 3500
ABV in Apparel Store will be Rs 15000 to Rs 17000

The ABV is always higher during the festive season or during new product launches.

7. Units Per Transactions (UPT): This is also called Items Per Cash Memo. This refers to the number of products sold in a single bill or the number of quantities sold in a single bill. The formula to calculate UPT is mentioned below:

Units Per Transaction = Total Units Sold/Number of Bills Generated

For Example: Consider that the store is selling 100 qty and to sell this 100 qty the store cuts 25 bills. So now UPT = 100/25 = 4 qty. Here the Units per Transaction is 4 quantity. i.e the store is selling on an average 4 quantities per bill.

In another example, consider that the store is selling 8500 quantities in a month by generating 2400 bills in the same month. Now the UPT for the month will be: UPT = 8500 Qty/2400 Bills = 3.54. So the store is selling on an average 3.54 quantity in a bill.

Typically the UPT will be in various formats will be as below: 
  • FMCG - 8 to 10 Qty
  • Apparel - 4 to 5 Qty
  • Electronics - 1 to 2 Qty
8. Average Selling Price: Average selling refers to the average price of a particular product or a commodity sold in a retail store. 

The Formula to calculate the Average Selling Price is:
ASP = Total Sales/ Total Quantity Sold

For example, let us consider that the store does a sale of Rs 200000 in the day by selling 250 qty of products or merchandise. Now the asp will be: ASP = Rs 200000/250 qty = Rs 800 will be the average selling price of the product.

Now let us consider that the store is doing a business of Rs 60,00,000 in a month by selling a total of 8500 quantity in a month. Now the monthly ASP will be = 60,00,000/8500 = Rs 706/-

Typically the ASP in different store formats are mentioned below:
FMCG - Rs 200 to Rs 225
Apparels - Rs 1800 to Rs 2500
Electronics - Rs 12000 to Rs 15000

9. Sales per Square Feet (SPSF): SPSF is the sales generate per square feet of the store area. SPSF is calculated by the below formula:

SPSF = Total Sales / Total sales Area of Store

Consider the store is doing a business of Rs 1.Crore with the sales area of 10,000 square feet, now the: 
SPSF will be Rs 1,00,00,000 / 10,000 sqft = Rs 1000 per square feet

The higher the SPSF, the higher will be the profitability of the store. The SPSF also signifies how efficiently the company is making use of its assets to generate sales and maximize the profitability

So friends these were the 9 important KPIs in retail sales.
Pls, comment down for any suggestions and feedback... Thank you 


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KPI's in retail, KPI calculations in retail, KPI calculations, retailing, retail



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