Below are the retail formulas we look at closely when we are evaluating the performance of a retailer's sales and inventory utilization.
Average dollar transaction during a period of time
ADS = Net Sales $ / Number of Transactions
Average selling price of an item
Sales AUR = Net Sales $ / Units Sold
Inventory AUR = Retail Inventory / Units OH
Average cost per unit
Sales AUC = COGS / Units Sold
Inventory AUC = Inventory at Cost / Units OH
Average units sold per transaction
UPT = Units Sales / Number of Transactions
Number of weeks of inventory on hand. Based on prior weeks sales. Can be calculated at a monthly level
S/S = Inventory Beginning of Period / Prior Week Sales
The percent of inventory sold in a given period time. Mostly commonly a week.
ST = Units Sold / BOP On Hand In-Store Units
Number of weeks a given amount of inventory will last
WOS = Currently Inventory Units / Average Weekly Unit Sales
Relationship of current time period sales to the prior time sales period (expressed as a percentage)
Build = Total Sales Retail / Previous Total Sales Retail - 1
Comparison of sales for stores that have been open more than a year.
Calculated in dollars or units for any period of time
Average Inventory = (Sum or all BOP inventory + EOP Inventory of the last period) / The Number of Data Points Used
Number of time the average inventory is sold and replaced during a specific time period.
Turn = Net Sales (Cost$ or Units) / Average Inventory (Cost$ or Units)
Difference between the unit cost and the ticket price (expressed as a %)
IMU% = (Ticket$ - Cost$) / Ticket$ * 100%
The profit of an item after all markdowns, allowances and cancellations have deducted
MMU$ = IMU Retail $ - Markdowns at Cost - Other Costs
MMU% = Maintained Margin Dollars / Net Sales Retail
Gross margin dollars returned for every dollar invested in inventory. This is used as a measure of productivity of a particular category or SKU, i.e. investment area and makes a great benchmark between product groups or even between companies.
GMROI = Gross Margin $ / Average Inventory at Cost