SWIM Reporting 101: How to keep your store afloat

Swim Reporting 101: How to keep your store afloat

(note: if you do not yet have a Swim account to use these reports in your business, you can sign up for one at www.onswim.com/signup)

A quick look at report definitions

Area	Word	Definition	Where in Swim
Sales	Gross Sales	Total revenue of items sold* *If local setting in utilities has sales price of stock item includes tax, gross sales shows including tax. If sales price excludes tax, gross sales excludes tax	Sales Reports SAL001 Retail Management Report
	Net Sales	Total revenue of sales less tax	Financial Reports FINOO2: Sales & Expenses Report
	Sell Price	Price item/s sold*	Sales Reports SAL003: Listing of Items Sold Report
	Average Sell	Average sale price of items.* Calculated by total gross sales / number of items sold	Sales Reports SAL001: Retail Management Report
	Markup	Factor applied to cost price to get the net sales price. Eg: if an item cost you $100 and you want to make $100 on item, the markup applied would be 2 (2 times the cost). The sale price would then be 100 x 2 = $200 (plus tax if applicable = $220) Notes: when entering stock, don't pass on supplier discount, markup on the cost without the discount	Set default markups in stock menu > stock submenu > markup table Markups set when entering stock. Edit markup through stock details area
	Average Markup	Calculated by net sales price / cost Eg ($110-$10) / $45 = 2.22	Sales Reports SAL001: Retail Management Report
	Stock Turn	The number of times during a year that the business replaces its stock. The higher the stock turn rate the more efficiently a business is able to grow sales volume. Stock turn must be calculated on yearly figures and is based on the cost of items, not the sales dollars Calculated by cost of sales for year / average stock holding for year at cost	Sales Reports SAL001: Retail Management Report
	ROI (or GMROI)	Return on Investment tells us how much money was returned for every dollar invested in stock. Calculated by GP$ for year / average inventory cost for year	Sales Reports SAL001: Retail Management Report PP001: Price Point Summary
	Fast Seller Indicator (FSI)	The number of days an item is expected to take to sell. Fast = items days within FSI Slow = items days within 2 x FSI Dead = items days greater than 2 x FSI	Set default FSI in utilities, drop down lists, departments. FSI set when entering stock. FAS001: Fast Seller Sales Summary
Gross Profit	GP$	Amount of money made on the sale Calculated by net sales - cost Eg: sell item $110, cost $45 GP$ = 110-10-45 = $55	Sales Reports SAL001: Retail Management Report SAL003: Listing of Items Sold Report
Gross Profit	GP% or GP Margin%	Calculated by GP$ / Net Sales Eg: $55 / ($110-$10) = .55 = 55%	Sales Reports SAL001: Retail Management Report
Net Profit		The total cost of stock at the beginning date of the report	Sales Reports SAL007: Stock Turn Summary
Stock	Opening Stock	The amount of money made after all expenses Calculated by gross profit less overheads	Financial Reports FINOO2: Sales & Expenses Report
	Closing Stock or Total Cost	The total cost of stock at the end date of the report	Sales Reports SAL007: Stock Turn Summary
	Avg Retail	The average selling price of stock items on hand. Price includes GST	Sales Reports SAL001: Retail Management Report
	Total Retail	Total selling price of stock items on hand. Price includes GST	Sales or Stock Reports SAL001: Retail Management Report STR001: Stock Inventory
Breakeven	Breakeven Point	Amount of sales per week you need to break even? Weekly breakeven = (overheads per year / 52 / avg GP%) + gst Example: weekly overheads = $208,000 / 52 = $4000 Avg GP% = .60 Breakeven = (4000 / 0.6) + gst = $7,333.33	Overheads total found in FINOO2: Sales & Expenses Report Avg GP% found in SAL001: Retail Management Report
Marketing	Walk-ins	The number of people who walk into the store
	Number of Transactions	Number of sales made. This is different to the number of items sold.	Customer Reports CR020: Customer Marketing Overview
	Conversion Rate	The percentage of customers who actually buy. Calculated by: number of transactions / walkins * 100	Customer Reports CR020: Customer Marketing Overview
	Retention %	Number of customers last year compared to year before	Customer Reports CR020: Customer Marketing Overview
	Average Transaction Value	The average amount a customer spends each time they buy from you. Calculated by total value of sales divided by number of transactions	Customer Reports CR020: Customer Marketing Overview
	Frequency of purchase	How often customers buy	Customer Reports CR020: Customer Marketing Overview
	Sales per square meter	The sales revenue generated per square meter of retail space. Calculate by gross sales / retail space in square meter
	Sales per employee	Shows as a percentage the performance of each staff member. Calculated by gross sales / sales for employee * 100

Return on investment explained

To make money, you want higher gross profits from sales than the value you keep in inventory. The ROI gives you this information.

ROI tells you how much money you make for every dollar you have in inventory So if the ROI is less than 1.0 you are making less than one dollar profit for every dollar you have in inventory.

For example:

If your ROI is 0.52 you are making 52c for every dollar of inventory you have on hand. Ideally you want an ROI of $1.0 to $1.50 or greater.
If your ROI is less than $1 you need to look at why and make some changes.

Looking at why

Buy to much

View the Retail Management Report SAL001 for a year period.
In each department, is your average cost of stock higher than your gross profit? If it is, you have too much inventory. How much? A good indicator is make your inventory level the same as your profit level.
Units Sold vs Quantity in Stock: You should not carry more in stock than you sell in one year

Wrong Price Points

View the price point report PP001 for the department in question.
Look at the quantity in stock compared to the quantity sold in each price point.
Look at the total stock at cost for each price point compared with the sales.
Can you re-price stock that is under performing into a price point that is performing?

Stock Entered into Incorrect Departments

If your stock has been entered into the incorrect department then these reports will not give you the correct result. So if something looks wrong, check that the stock has been entered into the correct department and category. Also note that you can merge departments in Utilities.

Price Point Reports

Stocked

Look at the quantity in stock compared to the quantity sold in each price point. Do you have too much stock in that price point
Look at the inventory level for each price point compared with the sales. Do you have too much stock in that price point
Can you re-price stock that is under performing into a price point that is performing?

Under Stocked

Look at your better performing items and check that you have restocked in these price points. Is there a sufficient quantity on hand?

Buying

Before you go to a trade fair or on a buying spree, check the price point report to determine which departments and which price points you should be buying in.

Reports

Area	When	Looking At	Report in Swim
Sales	Daily	What was sold today When purchased How many sold year to date How many left in stock Check sell price, discount, markup Sales person	Sales Reports SAL003: Listing of Items Sold Note: select which fields to show Supplier Menu > Stock Listing by Supplier Code
Sales	Monthly	Comparisons: Compare this months sales to previous months and last year Check stock holding, sales and averages Price points. Check stock and sales for each department Fastsellers and core range. Check fast selling or core range items have been reordered. From fastseller report look at % of fastsellers to slow to dead sellers	Sales Reports SAL008: Sales Comparison Compare months Look at months percentage of sales to year Sales Reports SAL001: Retail Management Report Compare stock holding for each department to sales Compare the average selling price of the stock holding to the average price of items sold Compare the purchases for each department to the sales Check stock turn, GP and ROI Compare closing stock to GP Compare categories within each department Look at problem departments and over achieving departments Average sale -> try to increase Markup -> what should be getting Stock turn -> try to achieve 3 Price Point Reports PP001 - Price Point Summary PP002 - Price Point Listing Fast Seller Reports
Reordering	Daily Weekly Monthly	Discipline ensures the right products are on the shelves Check quantity sold, quantity on order and quantity on hand If there are any quantity on hand, make sure these items are on display and not in the safe If there are no quantity on hand determine if you want to reorder	Supplier Menu > Stock Listing by Supplier Code Select one or all suppliers and select the date period. You can reorder off this screen.
Staff	Weekly	Review staff performance in the areas of sales, discounting and refunds. Sales Targets Set monthly sales targets broken down to weekly and daily targets Tell staff sales targets and monitor them weekly	Sales Assistant Reports SAS001: Sales Assistant by Department SAS003: Sales Assistant Report Audit Trail

Marketing & Sales

The 5% factor

When looking at net profit it is not how much you make, but how much you keep. The 5% factor shows that by making small changes, there is a big change to the bottom line. Example:

Before	After
Net Sales = $1,000,000 Cost of goods sold = $700,000 GP = $300 000 (30%) Fixed costs = $200,000 Net Profit = $100,000 Increase sales by 5% Decrease marginal costs by 5% Decrease fixed costs by 5%	Net Sales = $1,050,000 Cost of goods sold = $698,250 GP = $351,750 Fixed costs = $190,000 Net Profit = $161,750 (61.75% increase in profit)

So lets look at how to make some small changes...

Decrease fixed costs
Fixed costs are items such as wages, lease and electricity. Look at the Sales & Expenses report to see your fixed costs. Review each type of expense and look for ways to reduce the cost. Examples include asking for prompt payment discounts from suppliers, reviewing pricing between suppliers, reviewing telephone companies and email more to reduce postage costs.

Increase Sales
You can look at your annual turnover as: number of customers x average sale x transactions per annum.
Your total number of customers can be looked at as: (leads x conversion %) + retained customers

So to increase sales you can

increase number of customers
increase number of transactions
increase average sales value

For example

Before	After
A store is open 6 days and retains 2/3 last years customers 15 walk-in customers per day (90/wk, 4500 /year) Average sale $200 Average customer buys twice per year (leads x conversion %) + retained customers = total customers (4500 x 20%) = 900 + (900 x 66%) = 600 = 1500 customers total customers x average sale x transactions per annum = turnover 1500 x 200 x 2 = $600,000 turnover	lead generation up by 10% conversion up 20 to 25% retention up 66% to 70% average sale up 10% one in 10 customers come back one more time (leads x conversion %) + retained customers = total customers 4950 x 25% = 1238 + 1238 x 70% = 867 = 2105 customers total customers x average sale x transactions per annum = turnover 2105 x $220 x 2.2 = $1,018,820 turnover

Analyse Business

Using the information below you can review your current state and then work towards increasing your turnover through customers, average sale and number of transactions.

Business at Present	Business in the Future
View the Customer Marketing Overview report under the customer menu. That report shows you the following: Leads = Conversion % = Retention Ration% = Average Sale $ = Frequency of Purchase = Turnover =	Fill in the following fields to determine where you want your business to be and the strategies you have in place to get there. What you would like your turnover to be $.............................................. How many sales per week are needed $................................................... At current conversion rate, how many leads are needed ...................... If you increase average sales by 10%, how many sales are needed per week ...................................................... How many lead generation strategies do you have ................................. Number of ways to retain customers ........................................................ Number of ways to increase average sales................................................ Number of ways to increase frequency of sales ......................................

Business at Present

Business in the Future

View the Customer Marketing Overview report under the customer menu.
That report shows you the following:

Leads =
Conversion % =
Retention Ration% =
Average Sale $ =
Frequency of Purchase =
Turnover =

Fill in the following fields to determine where you want your business to be and the strategies you have in place to get there.

What you would like your turnover to be $..............................................
How many sales per week are needed $...................................................
At current conversion rate, how many leads are needed ......................
If you increase average sales by 10%,
how many sales are needed per week ......................................................
How many lead generation strategies do you have .................................
Number of ways to retain customers ........................................................
Number of ways to increase average sales................................................
Number of ways to increase frequency of sales ......................................

Increase Number of Customers

Part of increasing the number of customers is knowing who your customers are, finding those customers and retaining those customers. You can analyse your customers by looking at the customer reports:

who - CR001: Best Customers
how found - CR017: How Customers Found the Store
age - CR007: Customers' Details List
location - CR011: Customers by Country
why purchasing - CR016: Reasons for Purchasing
who for - CR016: Reasons for Purchasing

If customers don't buy from you ask them why. If a customer asks for a product that you don't have write it down. Look for trends in requests and get that stock in to maximise your sales.

Increase average number of transactions per year

Determine why customers are not buying from you
Get customers back into your store more often:

Customer loyalty programs- TJS can print customer loyalty cards with your company details and customer information
Thank you notes and gifts - Customer Menu > Customer letters > Customers who have purchased after x date and spent more than $x or Utilities > Scheduled tasks > email or SMS
Birthdays, Anniversaries and Special Event Letters - Customer Menu > Customer letters > Customers with a birthday | Customers with an anniversary | Best customers etc
Make your customers feel special
Wish List / Gift Registry - Customer Menu > Customer Details
Referrals - Customer Details > Customer Overview & Customer Reports > CR013: Customer Referrals

Make stock look presentable and have quality displays
Be different and unique
Create a theme in your stock displays
Make customers walk past stock to get to the sales counter for common purchases such as repairs

Increase average sale dollar

Provide add on products. Examples are:

Have jewellery cleaners near the cash register. When a person purchases an item ask them if they would like to purchase a cleaner to keep the item looking its best
When a man purchases an engagement ring or wedding ring for his bride casually ask "What did you have in mind as a wedding day gift for your bride?". He may respond to this 'Oh, I have to get her a wedding day gift?". The salesperson can reply "Well, pearls are a traditional wedding day gift..... "
When a couple buy wedding rings, casually ask them "What did you have in mind for your bridesmaid gifts?

Increase prices. Ensure you are getting the correct markup on your products
Check retail management by department or price point report. Compare average sale in each department to average selling price of current stock. Ensure stock holding is similar to average sale
Reduce discounting (see Price and Volume chart below....discount with caution)

Price and Volume Chart

Sales people in all types of industries discount. So much so that some sales people see it as a crucial part of the selling process. But if you do discount, how does it affect your bottom line?

The following table indicates the increase in sales that is required in order to compensate for a price discounting policy. By way of example, if your margin is 40% and you reduce the price by 10%, you need sales volume to increase by 33% to maintain your current profit level.

If your present margin is	20%	25%	30%	35%	40%	45%	50%	55%	60%
And you reduce your price by:	To produce the same profit, your sales volume must increase by:
2%	11%	9%	7%	6%	5%	5%	4%	4%	3%
4%	25%	19%	15%	13%	11%	10%	9%	8%	7%
6%	43%	43%	25%	21%	18%	15%	14%	12%	11%
8%	67%	47%	36%	30%	25%	22%	19%	17%	15%
10%	100%	67%	50%	40%	33%	29%	25%	22%	20%
12%	150%	92%	67%	52%	43%	36%	32%	28%	25%
14%	233%	127%	88%	67%	54%	45%	39%	34%	30%
16%	400%	178%	114%	84%	67%	55%	47%	41%	36%
18%	900%	257%	150%	106%	82%	67%	56%	49%	43%
20%	-	400%	200%	133%	100%	80%	67%	57%	50%
25%	-	-	500%	250%	167%	125%	100%	83%	71%
30%	-	-	-	600%	300%	200%	150%	120%	100%

Discount with caution!

On the other hand, if you adopt a premium price strategy, the following table shows the amount by which your sales would have to decline following a price increase before your gross profit is reduced below its present level. For example, at the same 40% margin, a 10% increase in the price could sustain a 20% reduction in sales volume.

If your present margin is	20%	25%	30%	35%	40%	45%	50%	55%	60%
And you increase your price by:	Your sales could decline by the amount below before your gross profit is reduced:
2%	9%	7%	6%	5%	5%	4%	4%	4%	3%
4%	17%	14%	12%	10%	9%	8%	7%	7%	6%
6%	23%	19%	17%	15%	13%	12%	11%	10%	9%
8%	29%	24%	21%	19%	17%	15%	14%	13%	12%
10%	33%	29%	25%	22%	20%	18%	17%	15%	14%
12%	38%	32%	29%	26%	23%	21%	19%	18%	17%
14%	41%	36%	32%	29%	26%	24%	22%	20%	19%
16%	44%	39%	35%	31%	29%	26%	24%	23%	21%
18%	47%	42%	38%	34%	31%	29%	26%	25%	23%
20%	50%	33%	40%	36%	33%	31%	29%	27%	25%
25%	56%	50%	45%	42%	38%	36%	33%	31%	29%
30%	60%	55%	50%	46%	43%	40%	38%	35%	33%