From Home Furnishing Business
Bring it On
By Bob George
As a nation with our smartphones, we have become obsessed with our personal performance. We measure the number of steps we take each day, the calories we consume and the hours we sleep.
Moving to the next level, we measure how we compare to others (typically anonymous others) in terms of the best time on this defined jogging trail or the highest finish in a road race. We self monitor our health by checking our heart rate and, in the not too distant future, we will do this with all of our vital signs. In our financial lives on a daily basis we monitor the daily stock updates and note any changes in our bank balances.
From a business perspective we are just beginning to monitor our business activities such as daily traffic and daily sales.
As we move to the next level we will begin to compare our businesses to other similar retailers. In this issue of Home Furnishings Business we have addressed retail metrics and, specifically the financials. Overall, as an industry, the results are pretty poor. However, this is understandable with a high percentage of retailers having under $5 million in sales. A small retailer with sales of about $2 milion is primarily a family income with no reason to show a profit. Our focus is on the retailers with sales of $5 million or more. We are measuring against the top 25 percent of performers and then the top 10 percent to provide a perspective of what could be.
Creating a high performance company starts with a vision. However, the emphasis must quickly focus on the details. It begins with increasing margin by half a point and reducing warehousing costs by 5 percent.
Think of the way you would approach that anonymous jogger who bested you by 10 minutes on this new course. You would view this not as a discouragement, but as a challenge to do better. You would probably never meet that runner, but you know he or she is aware that someone else is in the game. That is what defines a high performance retailer.
Our total organization from the magazine to the research division to the consulting group celebrates high performers. If you are not currently in the race, get to the starting line. We are here to cheer you on.