Annual P&L Study - Part 3
by Tim Quebedeaux
Today we will reveal who is in the High Achievers Group defined as attaining between 5% & 10% Adjusted Profit in 2021. Eighteen Garden Centers were able to navigate through all the challenges of last year to achieve an average of 8% profitability.
The High Achievers of the 2021 P&L Study:
As we congratulate this great group of Centers, let’s look at the next two parts of the P&L Study: Physical Facility Information & Average Sale, Transactions Counts Information.
In Physical Facility information, there are a lot of numbers reported which all point to three key ratios: Sales per Parking Space, Sales per Acre, and Sales per POS Terminal. In most 10% Profitable Garden Centers you will see approximately $50K per parking space, $1M per Acre, and $1M per POS Terminal. In analyzing each one of these ratios you will be able to pinpoint where improvements are needed to increase your productivity and ultimately profitability.
The next section dives into the Revenues and Transactions. This starts with Average Sale, Business Cost, Margin Dollars, and Marketing Cost per transaction. By scaling these numbers to each transaction, it makes an easy comparison across the board to other groups such as Retail, Retailer Grower, or Best Practices. Some of these metrics, such as Business Cost per transaction, make great training tools to explain costs to all employees. Increasing their understanding of how the business works helps them take ownership and succeed. This section then moves on to Marketing Cost and Payment methods. The Marketing comparisons are just that. Compare yourself to what others are spending. The payment methods ultimately show your credit card rate. Ensure you are getting the best rate you can. This is certainly an area where you can find a few points that go straight to your bottom line! The final KPI in this section is Gross Margin Return on Labor Hours (GMROL). This is a measure of your productivity, as it is your Margin Dollars compared to actual hours spent from seasonal staff all the way to owners. A low GMROL is usually an indication of a high Wage & Wage Benefits (W&WB) percentage.
Within these parts of the P&L Study, a lot of numbers are crunched to produce some key ratios that will help you tweak your business operations. In the following parts, we will dive into Inventory Turns and GMROII, two important keys to your Inventory Management performance. We will also be announcing the Best Practices Garden Centers of 2021!
Much more story to follow... Let's go to Part 4 HERE.
Got questions or need more information about The Group's the Annual P&L Study or the Weekly Department Review (WDR)? Give Tim a call or email.
Tim Quebedeaux
Cell: 770.355.6249
Email: CLICK HERE
Group Client Reminder: You can watch the March 10th GROUPtalk LIVE presentation when Tim and Steve presented 2021 P&L Study Reveal. Log into the WebSystem and go to the Clients-Only menu and down to Training - 2021 P&L Study Reveal.
Tim Quebedeaux, RetailKPI Consulting, is a service provider for The Garden Center Group and manages all Group financial sharing programs. The Weekly Department Review (WDR) and The Annual P&L Study are industry exclusives developed by The Garden Center Group and are included in your retainer!
REMEMBER: Your interaction (by phone and email) with Group Service Providers such as Tim Quebedeaux, Sid Raisch, Jean Seawright, John Kennedy, and of course Danny Summers are included in your retainer! So what are you waiting for? Take advantage of all that The Group has to offer and give them a call or send an email now!
