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Seeking Retail Excellence? Track These 8 Retail Metrics to Get There Fast!

Divir Tiwari
Divir Tiwari

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Seeking Retail Excellence Track these 8 Retail Metrics to get there fast!

Seeking Retail Excellence? Track These 8 Retail Metrics to Get There Fast!

Divir Tiwari
Divir Tiwari

Share Our Post :

Seeking Retail Excellence Track these 8 Retail Metrics to get there fast!

Anil Khatri was the 2nd generation entrepreneur of a Rs 400 crore manufacturing company that was one of the biggest suppliers of oats and wheat bran to food companies in India. 12 months ago, he decided to launch their own range of high-fibre biscuits, rolled oats and granola in north India.

The first few months went into setting up a wider distribution network and expanding their reach across Delhi, Punjab Chandigarh and U.P. Anil quickly realized that B2C selling is very different from B2B selling. Sales were not scaling up as much as he expected them to, and he was getting increasingly frustrated. 

He reached out to an acquaintance, Mr Garg, the National Sales Head of a wafers company and asked him, “I understand B2C has its own unique challenges but I’ve assessed how we operate. Our quality is at par with brands in the same segment, we’re present in the right outlets, we’re quite fair on our pricing, and we have hired competent salespeople. Then why aren’t our sales numbers growing quickly? What am I doing wrong?”

Mr Garg laughed and said, “ Have you heard of the American Airlines olive story? They were looking for ways to streamline their expenses and improve profitability. By removing just one single olive from every salad served to passengers, the airline saved $100,000 a year. The devil is in the details, my friend. 

You think you have a competent team, but do you know how many outlets are billing regularly out of the ones your boys visit every week? Your team is bringing in the orders, but do you know what is the number of categories or Lines Cut per Call they are selling? If you don’t track the right success retail metrics, knowing where you’re going wrong will always remain a grey area. The platform I use helps me get that drilled-down view of our numbers. That’s where you’ll also see the areas where you can improve your efficiency.” 

Over the next couple of months, Anil rolled out a sales and distribution platform that was scalable, agile and seemed almost custom-made for his industry. To start with, the customer success team helped him identify these 8 retail metrics that he needed to track to fast-track his sales in kirana retail.

#1. Daily Retail Time

It is the number of hours a salesman spends in the market every day to visit  the retail outlets in his beat. In the CPG industry, a salesperson typically spends about 7-8 retailing hours in the market,  usually starting the day around 10 am.

Earlier, Anil knew that his people are in the field till 4 pm. The South Delhi salesmen had a daily target of visiting 32 outlets; for North Delhi, it was 30. 

Daily Retail Time = Time spent from 1st call to last call.

His technology partner helped him understand that the industry average for the number of outlets visited in a day is between 38-40, and the industry average spent at an outlet was about 9 minutes. This means Anil’s salesmen as well as outlet potential were being underutilized. 

With data coming in live from the field via automation, Anil streamlined his sales operations, and increased visit targets between 32-38 depending on the territory. Insights like these from the salesforce platform gave him transparency of data and helped him improve market penetration.

#2. Strike Rate

It is the proportion of Productive Calls out of the Total Calls made in a day. 

Strike Rate = (Number of outlets that placed an order/ Total calls made)*100

If your strike rate is 60% or lower, you should drill down details on the shop- type, geography, no-sales reason, etc. to get deeper insights and take corrective action.

For Anil’s salesmen, the focus earlier was more on the total value of orders booked rather than the number of orders captured. He discovered that in one beat, only 8 out of 28 outlets placed an order. That’s a strike rate of only 28%! Deploying the SFA helped Anil see these glaring red flags for the outlets that weren’t ordering, and then take specific measures.

#3 Salesman Target Vs Achievement

It is a metric that tracks individual sales performance. Each member of the on-ground field force is given a monthly sales target, based on the size of the business, the company’s market share, outlet penetration and overall business goals. Targets can be both revenue-wise and category-wise. 

Salesman’s Target Achievement = (Revenue achievement/Revenue Target + Category achievement/ Category target)*100

e.g  Anil’s sales officer had a monthly target of Rs 5 lakh revenue and 100 cases of the newly launched granola bars. With automation, he could view the ‘as on date’ target achievement of every salesperson and also identify the ‘high performers’ (to recognize and reward) and the bottom 15-20%  (to identify training interventions).

#4. Fulfilment Rate

It is the number of retailer orders that a distributor is able to fulfil completely within a defined amount of time.

Fulfilment Rate = (No of orders entirely fulfilled/Total orders received)*100

Sometimes, the distributor might partially fulfil an order if he doesn’t have sufficient stock of the SKUs ordered. On a few occasions, he might have to cancel an order completely if he is OOS (Out of Stock) on the products ordered. 

With a Distributor Management system integrated with his SFA, Anil was able to see that the Fulfilment Rate from his North Delhi distributor was almost 90%, but it was below 80% for the Dwarka distributor. The reason why the Dwarka distributor was below 80% was that he didn’t want to raise too many POs and lock his liquidity in Anil’s products because the margins that his company gave him weren’t high enough! Thanks to the insights coming in from his automation solution, Anil was able to identify the root cause of low fulfilment rate this quickly. 

#5. Collections, Outstanding and Ledger

These are the numbers against each distributor that show his financial prowess e.g. How quickly is he collecting money from the market, how much is he liquidating in the market, what is his total outstanding in the market from retailers etc. 

If a brand has adopted a DMS, the sales leaders can see these numbers against every distributor, and gauge which partner can be pushed to carry more inventory, or to rotate his inventory faster.

#6. Demand capture

It is capturing all demand that a Distributor receives from the market. Mostly, the company or the distributor’s own salesmen relay retailer orders to him every day. But sometimes distributors receive orders directly from retailers, either because they have a good relationship with the distributor or the company salesman might have been absent that day. 

Total Orders Received by Distributor = Orders via SFA + Direct Orders

With demand capture from direct orders as well as SFA orders captured on the same screen, Anil’s sales leaders made sure that demand capturing did not stop even if a salesman missed his beat.

#7. Lines Cut Per Call (LPC)

It is the number of different product categories that a salesman sells. It is also known as Range Selling.

No. of Categories punched per visit (Out of the Total No. of Categories stocked in that outlet)

Anil’s company had 3 major product categories: digestive biscuits, rolled oats and granola, all in different flavours. Since the company launched digestives and rolled oats together, the salesmen had built good business for the biscuits. When the granola bars were launched later, they didn’t push the category hard enough, because there was already huge demand for the biscuits and the sales volume stayed strong.

Anil understood that he was in danger of depending on one single category for 80% of his total sales. He needed to hedge his risk and promote other products more to have a broader market presence. 

#8. Outlet-wise sales target & Category wise targets

Sales leaders make revenue projections for each outlet based on factors like territory (Tier 1 / Tier 2/Tier 3 cities), shop type (small kirana store, Modern Trade store (MT), Standalone MT, etc), and market potential.

Outlet-wise performance: = Maximum order from the outlet + Targeted Lines Cut

Read More: Make your Merchandising reliable and smarter with FieldAssist Modern Trade Arsenal

Anil had given both outlet-level targets and category-level targets to his team, but he had not been aggressively tracking category-level performance. Now with such detailed visibility of data on the automation platform, he had numbers like MTD (Month Till Date), Target Vs Achievement Month on Month etc at his fingertips. 

ModMart – A Deep Analytics Platform for Acing In-Store Execution for CPG Brands

Anil couldn’t believe that an end-to-end integrated solution could open up so many possibilities for scaling up sales, improving ROI and crafting a kick-ass GTM strategy with authenticated performance numbers. 

If you too are struggling to ramp up your brand like Anil, don’t waste another minute! Reach us.

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