Retail Fashion Stores KPI’s Post COVID-19 . The retail fashion industry was considered as a fast growing sector. According to researches, this market was set to increase annually by a compound annual growth rate of 4.6% from 2019 – 2023.
It showed that the largest section consists of women and children clothing. Also, the revenue generated for 2019 set new records. That said the COVID-19 crisis has and is still hitting the sector very heavily.
Fashion brands like H&M, Marks & Spencer and Zara are dominating this space globally. They have been able to achieve this with competitive pricing, operating systems and robust branding strategies.
The rise of consumer classes and increased disposable incomes has led to an increased demand for apparel and clothing products. Also, rise in nuclear families and young urban customers and have enhanced the fashion retail industry worldwide.
The prospect of growth for any retail fashion company in this sector was tremendous. However, several companies find it more and more difficult to keep going. Here are some Key performance indicators you should monitor to help your retail fashion store to stay and grow.
Convert Foot Traffic To Sales
The retail fashion industry is as competitive as ever and it is more for brick and mortar stores. Successive lockdown periods threaten further not only the profitability of the stors but how viable the business is. You have to make sure customers keep on buying.
Set measures in place to ensure every prospective customer that walks into the store leaves with satisfactory purchase. This is the only way to make sure your business remains.
Gross Revenue Per Employee
This metric is an important internal KPI (key performance indicator) for retail fashion companies. It is calculated by measuring the total revenue accrued for the last 12 months divided by the number of full-time employees
In most cases, this ratio is used along with expenses per employee and profit per employee. If you constantly monitor this metric, you can confidently track decline or growth in overall efficiency of your retail fashion company.
Keep in mind that this metric is loosely related with growth rates, market caps or total revenue, so do not over rotate it.
Gross Profit Per Employee
This metric is used is used to measure net income accrued in the last 12 twelve months divided by the number of full-time staff. This is also an internal key performance indicator and it considers both costs and income.
With this metric, you can measure the efficiency of your employees, and the improvements gained with investments in culture and training. On the other hand, you can also invest in automation and processes (the former can be used to streamline the number of staff needed).
Inventory to sales ratio is used to measure the number of sales your retail fashion company is fulfilling compared to your amount of inventory. This metric measures the inventory management of your store and helps adjust the stock you have to preserve high margins.
Profit Margin Per Product
The primary aim of your retail fashion company is to turn in a decent profit. So it is important for you to know the ways you can achieve this. By using the per unit analysis of gross profit margin together with contribution margin, you can get vital data about the product or product lines that are making you more money.
This analysis will also give you the data on the products that are performing poorly and you can make adjustments accordingly.
By observing and reacting to these key performance indicators carefully – there’s a stronger chance your retail fashion company will improve its results