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Measuring productivity to boost profitability

In order to measure sales productivity over time, you need to be able to set markers so that you can track progress. 

Without these, you can’t accurately see how it develops. However, before you start designing charts and spreadsheets, it’s worth bearing these points in mind:

  • Staff need to know exactly what their job entails and what they should be doing. Does everyone have a job description?
  • They need to know how to do their job. Have you trained them?
  • They need to know why they are doing it. Have you shared your vision and values for the business with them?

When we talk about productivity in a retail environment, we mean the effectiveness of the sales staff. The bottom line here is,did they sell and how much? This then needs to be broken down by such factors as:

  • How many customers came into the shop?
  • How many sales were achieved (the conversion rate)?
  • The value of each sale (and the average value)
  • The number of items sold by each member of the sales team (and the average volume).

One of our clients had three womenswear boutiques. Whilst his sales by volume were impressive, he wanted to boost sales by value. He brought in some new brands to get his customers to trade up, but little changed for the first half of the new season. It turned out that the sales team knew very little about the new stock and didn’t feel confident recommending it, although they certainly weren’t steering customers away from it. We suggested that he took the time to work on product knowledge and styling issues with the team.  At the same point the following season, the new brands were selling well and the monthly sales had increased in value by 18%. 

Thierry Bayle, Global Fashion Management

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