KPI stands for Key Performance Indicator. In retail, KPIs are like your dashboard gauges, telling you how your store is performing in key areas. They help you track progress towards your goals and identify areas for improvement.
Here are some common retail KPIs:
An SKU, or Stock Keeping Unit, is your product's unique identifier in the retail world. It's like the fingerprint of your merchandise, allowing you to track inventory, manage orders, and optimize operations.
Think of it as a store detective in code form. Each item, whether a blue t-shirt or a red wagon, gets its own alphanumeric SKU – usually 8-10 characters long – that tells its story:
For example, "BLT-SHIRT-M-BLUE" could identify a medium-sized, blue t-shirt from "Blue Threads" clothing.
In retail, MBQ stands for Minimum Base Quantity. It is the minimum number of units of a specific product that a retailer must keep in stock at all times. MBQs are used to ensure that retailers have enough inventory to meet customer demand, while also avoiding overstocking and waste.
MBQs are typically set based on a number of factors, including:
MBQs can be set at the product level, the department level, or the store level. For example, a retailer may set a MBQ of 100 units for a popular product like a new video game, but only 50 units for a less popular product like a new type of coffee maker.
In retail, FMCG stands for Fast-Moving Consumer Goods. These are everyday items that fly off the shelves quickly, usually at relatively low prices. Think:
FMCGs are the workhorses of retail, constantly churning through the sales cycle. They often have high volume sales but low profit margins, so they rely on mass appeal and effective distribution. Think about your local supermarket aisles crammed with these familiar faces!
CDIT can have two main meanings depending on the context, here is an explanation of both contexts:
1. Consumer Durables and Information Technology:
In the retail world, CDIT commonly refers to Consumer Durables and Information Technology. This broad category encompasses a wide range of products, including:
These products tend to be:
The CDIT sector is a significant part of the retail landscape, and its growth is driven by factors like rising disposable incomes, increasing urbanization, and technological advancements.
2. Center for Development and Implementation of Technologies (India):
If you're dealing with Indian retail specifically, CDIT might also stand for the Center for Development and Implementation of Technologies (CDIT). This government agency falls under the Ministry of Commerce and Industry and focuses on:
So, the meaning of CDIT in retail depends on the context. If you're unsure, it's always best to ask for clarification to avoid any confusion!
In retail, it stands for Goods Received Note.
Think of it as the official handshake and documentation between you (the buyer) and your supplier. It's like a birth certificate for your inventory, proving the goods you ordered have arrived safely and correctly.
Here's what a GRN does:
Overall, GRNs are crucial for maintaining inventory accuracy, ensuring smooth supplier relationships, and preventing financial headaches. They're the silent heroes behind the scenes of a well-run retail operation.
In the world of retail, SOH, or Stock on Hand, is your inventory's current state of being. It's like a real-time snapshot of all the goods you have available at any given moment. Think of it as the answer to the question: "What do I have in stock right now?"
SOH can be viewed at different levels:
In retail, UPT stands for Units Per Transaction. It is a metric used to measure the average number of items a customer purchases in a single transaction. UPT is calculated by dividing the total number of items sold by the total number of transactions.
For example, if a store sells 100 items in 10 transactions, the UPT would be 10 items per transaction.
UPT is an important metric for retailers because it can help them to understand how efficiently they are selling their products. A high UPT indicates that customers are buying more items each time they visit the store. This can lead to increased sales and profits.
Retailers can take a number of steps to increase UPT, including:
In Retail, DSD can have 2 Possible meanings depending upon the context:
1. Direct Store Delivery (DSD):
Imagine a streamlined process where manufacturers bypass the retailer's central warehouse and deliver goods straight to individual stores. That's DSD in a nutshell! It's like a shortcut in the supply chain, saving time and potentially reducing costs.
Here's how DSD works:
DSD is typically used for:
2. Demand Shaping Diagram (DSD):
This meaning of DSD takes us into the realm of marketing and sales forecasting. A DSD is a visual tool used to map out and analyze the factors influencing customer demand for a product or service.
Think of it as a roadmap for understanding what drives customers to buy, helping businesses:
GRDC in Retail stands for Goods Returned to Distribution Center (DC) in retail. This refers to the process of returning merchandise from stores or customers back to the main distribution hub for further processing.
Here's a breakdown of the GRDC process:
1. Returning merchandise: This can happen for various reasons, such as:
2. Sorting and inspection: When the GRDC arrives at the distribution center, it's sorted and inspected to determine the reason for return, condition of the goods, and appropriate action.
3. Processing options: Depending on the outcome of the inspection, the GRDC can be dealt with in different ways:
4. Documentation and tracking: Throughout the process, proper documentation and tracking are crucial to maintain inventory accuracy, manage finances, and avoid discrepancies.
LFL, in the world of retail, stands for Like-for-Like (LFL) sales. It's a key metric used to measure the growth of a retailer's sales, but with a twist! Unlike regular sales figures, LFL sales exclude the impact of changes like opening new stores or closing existing ones.
Think of it as taking a temperature check of your existing business, excluding any external factors that might skew the results. It's like comparing apples to apples, ensuring a fair and accurate assessment of your core business performance.
Here's why LFL sales are so important:|
In Retail, SOP can have 2 different meanings depending upon the context:
1. Standard Operating Procedure (SOP):
In retail, an SOP is a set of instructions that outlines the best practices for completing a specific task or process. It's essentially a blueprint for ensuring consistency and efficiency across your entire operation, from opening and closing the store to handling customer returns and processing sales.
Some common examples of SOPs in retail include:
2. Sale of Premium (SOP):
In this context, SOP refers to the sale of a premium, which is a type of financial instrument that gives the holder the right to purchase a certain amount of an underlying asset (such as a stock or bond) at a fixed price within a specific period.
When you sell a premium, you are essentially entering into a contract with the buyer to sell them the underlying asset at the strike price on or before the expiry date. In exchange for this obligation, you receive a premium payment from the buyer.
The sale of premiums can be a complex financial strategy, and it's important to understand the risks involved before entering into any such agreement.
In Retail, ASP can have 2 different meanings depending upon the context:
1. Average Selling Price: This is the most common meaning in the context of retail. It refers to the average price at which a particular product or service is sold. To calculate ASP, you simply divide the total revenue generated from the product or service by the total number of units sold.
Here's why ASP is an important metric:
2. Apparel Selling Period: This term is more specific to the apparel and fashion industry. It refers to the timeframe during which a particular season's collection is available for sale at full price before being marked down. The length of the ASP can vary depending on the brand, retailer, and type of product.
For example, a high-end fashion brand might have a shorter ASP of a few weeks, while a mass-market retailer might have a longer ASP of several months. Understanding the ASP for different brands and retailers can help you plan your shopping accordingly.
ATV stands for Average Transaction Value. It's the average amount spent per customer order in your retail business.
Remember, a high ATV means your customers are buying more per transaction, leading to potentially higher overall revenue and profit.
Here's a quick recap of the benefits of understanding and optimizing your ATV:
MBO in retail Stands for Multi Brand Outlet. It is a retail store that carries a wide variety of products from different brands under one roof. This can encompass anything from clothing and footwear to electronics and home goods.
Benefits for consumers:
Benefits for brands:
Examples: Macy's, Nordstrom Rack, DSW, and Decathlon are all popular multi-brand outlets.
SSPD Full Form in Retail
In the retail industry, SSPD stands for Sales Per Square Foot. Imagine it as a measuring tape for your store's efficiency, telling you how much revenue gets squeezed out of every square inch of your available space.
Think of it like this: you have a limited amount of real estate in your store (think square footage), and SSPD tells you how effectively you're using that precious space to generate income. The higher the SSPD, the more you're squeezing out those sales dollars for each square foot you have.
Calculating SSPD is pretty straightforward:
For example, if you had $10,000 in sales during a month and your store is 2,000 square feet, your SSPD would be $5 per square foot.
In retail, VM stands for Visual Merchandising. It is the art of transforming your store into a captivating spectacle, where products sing their siren song and entice customers to delve deeper. It's the magic touch that turns shelves into stages, walls into canvases, and every corner into a story waiting to be told.
Here's how VM works its magic:
In Retail Context, RTV most commonly stands for Return to Vendor. This refers to the process where a retailer sends unsold, damaged, or unwanted merchandise back to the supplier or manufacturer.
Think of it as a rewind button for products that didn't quite make the cut in your store. RTVs can happen for various reasons:
CSA can have 2 different meanings depending upon the context:
1. Customer Service Associate:
Think of a CSA as the frontline ambassador of your brand, the friendly face and helpful voice that guides customers through their shopping journey. They're the problem solvers, the information providers, the product whisperers who turn browsers into buyers and keep loyal customers coming back for more.
Here's what a typical CSA does:
Benefits of having great CSAs:
2. Commercial Services Agreement:
CSA or Commercial Services agreement can be defined as a handshake agreement between a retailer and a service provider, outlining the terms of their collaboration.
In Retail, OTB can have 2 different meanings depending upon the context:
1. Open to Buy: This is the most common meaning in the world of inventory management. Imagine OTB as your shopping budget for buying new merchandise. It represents the amount of money you have left to spend on fresh inventory after factoring in:
Planned sales + Planned markdowns + Planned end-of-month inventory - Planned beginning-of-month inventory = Open to Buy
2. Offer to Buy: In some instances, OTB can also signify an "Offer to Buy" made by a potential buyer for a retail business. This often happens during acquisition negotiations and involves details like:
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