Dipstick Parameters

This is in continuation with the time to revise concepts.Today we will discuss formulae used to find how a particular store is performing.
The dipstick parameters can be used for finding the performance of four verticals that is customer transaction, stock, space and employees. The formulae are discussed as under.

1. Customer Transaction:

1.1 Customer Conversion Ratio = (Number of Bills Made/Customer entry)*100
1.2 Transactions Per Hour = (Number Of Transactions /Number of Hours)*100
1.3 Sales per Transaction or Ticket size = (Net Sales/ Number of Bills)

2. Stock

2.1 Average Selling Price = (Total Values of Good Sold/ Total Quantity Sold)

2.2 Stock Turnover or Inventory Turnover = (Net Sales/ Average Inventory)

OR

Stock Turnover or Inventory Turnover = (Cost of Goods Sold/ Average Inventory at Cost)

This depicts how many times the inventory rotates in a year.

2.3 Gross Margin Return on Inventory = (Gross Margin/ Average Inventory)

2.4 Shrinkage to net sales = (Actual inventory- Book Inventory/ Net Sales)* 100

2.5 Sales to Stock Ratio = (Net Sales/ Average Cost Inventory)

3. Space

3.1 Sales Per Square Feet = (Net Sales/ Square Feet of Selling Space)

3.2 Stocks Per Square Feet = (Net Stock/ Square Feet of Selling Space)

3.3 Percentage of Space for Department = (Space allocated to each department/ Total Selling Space)

*** See the sales per Square feet of the store and then calculate sales per square feet of each department. And Then compare how each department is performing relative to the store itself.

4. Employees

4.1 Net Sales Per Full Time Employee = (Net Sales/ Number of Full Time Employee)

4.2 Labour Productivity = (Total Labour Costs/ Net Sales)*100