Responsibility of a Store Manager ensure smooth operations.

The following is based on the implementation (on a store level) of the 80/20 Rule. This rule is also known as the Pareto Principle. It indicates that 80% of the results you get, come from 20% of what you do. The following is an outline of the 20% effort, which accomplishes 80% results. 

The Planning Process:

One hour of planning equates to three hours of execution. Plan your work and the work of your employees in advance. In the last 15 minutes of the day make the time to plan tomorrow’s activities. Write it down. When completed, read several times. The reason for this is to allow tomorrow’s planned activities to ferment in your sub-conscience mind. Between 7PM today and 9AM tomorrow, Ideas will pop into your mind that will assist you in the accomplishment of the activities you have planned. Planned work contains a Sense of Purpose.

Asset Protection:

This is every employee’s first responsibility to the Company. All assets from Customers to Inventory and from Vehicles to Remotes.

Visual Merchandising of Store:

Our display is the first thing that a customer or potential customer sees when they come into the store. We must make sure that our displays are visually stimulating to the people we serve.

Sales Objectives:

This area of your operation must be reviewed and adjusted every day by the person that is responsible for its attainment. The standard is 1% of your monthly beginning Basic Output Report needs to be put out per day on an average in deliveries. Accomplishing this will put out between 25% and 30% of your beginning Basic Output Report in Deliveries.

Collections Objectives:

This area of your operation must be constantly monitored every day by the person that has been assigned the responsibility for its attainment. From Monday to Saturday the standard is 12, 10, 8, 6.5, 4 and 3.5. The RSS% (Reds, Skip and Stolen) must remain under 2.5% or less at all times.

Organizational Objectives:

You must send a message to the people you interact with on a daily basis that you have it together. The best way to approach this is to write down anything that is required to be done at a later time or date. Example; Deliveries, Pick-Up, Service Calls, Follow Up calls on Deliveries etc. "I Forgot", Is not acceptable for our customers therefore It cannot be acceptable for your company too.

Attitudinal Climate:

Out of all the written Policies and Procedures, Training techniques, Rules and Regulations this one is truly what determines the growth and success of a store. The attitude of the crew of the store determines the overall Attitudinal Climate. If the entire crew does not develop and thereafter maintain a Positive Mental Attitude then the overall performance of the store will suffer. Develop the habit everyday to purposefully establish a positive attitude and maintain this attitude throughout the entire day.

Training & Development of all store personnel to their fullest potential:

There are two types of employees in Retail today. Employees that don’t know and those that don’t care. For those that don’t know it is everyone’s responsibility in the Company to teach them. For those that don’t care, it is everyone’s responsibility in the Company to replace them with someone that does.

Entry level Retail professionals learn in three ways.

1)      Some employees you can tell how to do something, and from that day forward they can do it.

2)      Some employee you can show how to do something, and from that day forward they can do it.

3)      85% of the employees require being told and shown until they reach the level where they can perform properly from this day forward.

What is EBITDA?

“Earnings before Interest, Tax, Depreciation & Amortization.”

Earnings before interest, tax and amortization (EBITA) is similar to EBIT but strips out amortization. Amortization is always a non-cash item and therefore of limited interest to investors. Amortization is of less interest than depreciation (itself excluded from many measures) because it relates to intangible assets, and it cannot be used as even a rough proxy for replacement cost. EBITA is used in similar ways to other profit measures such as EBITDA. 

 

The commonest valuation ratio that uses EBITA is EV/EBITA. This is similar to EV/EBITDA apart from the inclusion of depreciation as a cost. EV/EBITDA is usually preferable. EBITA is an acronym that refers to a company's earnings before the deduction of interest, tax and amortization expenses. See EBITDA. It is a financial indicator used widely as a measure of efficiency and profitability. EBITA margins in developing telecom markets can be as high as 60%, but margins vary greatly across industries and over time.

EBITA can be calculated by taking the Profit Before Taxation (PBT/EBT) figure as shown on the Consolidated Income Statement, and adding back  Net Interest and Amortization. Often, Amortization charges are zero and therefore EBIT = EBITA.

A rough measure of operating cash flow, effectively, operating profit with depreciation added back. It differs from the Net Cash Inflow from Operating Activities shown in cash flow statements due to working capital movements. Earnings before interest, taxes, depreciation and amortization or, to give it its acronym, EBITDA, is a measure of a company's cash flow before certain deductions. It allows investors to see how much money a company is making before taxes, depreciation and amortization have been deducted. Basically, when investors place money in a company, they will want to know how much money the company has been making since their money was invested. EBITDA gives the investor an idea of how much money the company has made before its deductions. 

It is especially useful for a new company who has just started business and has not yet been hit with taxes, payments to creditors, and so on. If the EBITDA figure seems to have a good growth rate, then some investors may use this figure instead of the overall net figure. It can show them that the company has a future for potential growth and that they will get a return on their investment. Investors call this looking at the EBITDA margin rather than the net margin.

Amortization

Amortization is the distribution of a single lump-sum cash flow into many smaller cash flow installments, as determined by an amortization schedule. Unlike other repayment models, each repayment installment consists of both principal and interest. Amortization is chiefly used in loan repayments (a common example being a mortgage loan) and in sinking funds. Payments are divided into equal amounts for the duration of the loan,
making it the simplest repayment model. A greater amount of the payment is applied to interest at the beginning of the amortization schedule, while more money is applied to principal at the end.

The amortization calculator formula is: (1-vn)÷r, where n = number of years, v = 1÷(1+r),
and r = interest rate ÷ 100. See also time value of money.
Divide by (1+r) if a payment is due at the beginning.

Earnings

The net profit of a company that is distributed to its shareholders.
 

Depreciation

Depreciation is the drop in value of an asset due to wear and tear, age and obsolescence (going
out of date) as recorded in an organizations financial records.

Company Taxation

The system for taxing company profits.

10 Points to keep in mind to start a Retail Store

1) Choose a Business Legal Structure

 

Choosing the proper legal organizational structure for your business is one of the most important decisions you will make. While it is possible to change your structure at a later date, it can be a difficult and expensive process. Therefore it's better to make the right decision before you start your own business.

 

2) Choose a Name for Your Retail Business

 

Dreaming up a moniker may come easy for some, but others struggle with the task. Here are some do's and don'ts for naming your own retail business.

 

3) Apply for an EIN

 

An Employer Identification Number (EIN) is also known as a Federal Tax Identification Number, and is used to identify a business entity. Here's why you need one and how to apply online for an EIN before you start your own business.

 

4) Decide What Products to Sell

 

Finding a product for your retail business to sell may very well be the most difficult decision you will need to make when starting a retail business. Before you commit to a product or product line, consider these factors while deciding what to resell.

 

5) Write a Business Plan

 

Whether it is formal or informal, on paper or on disk, the process of creating a business plan will only help your business become successful. It is one of the most crucial steps in starting a retail business. Learn how to write a business plan for your retail store, why writing a business plan is necessary, purchase business plan software and view free sample retail business plans.

 

6) Learn the Laws

 

Understand what business licenses and permits you need to obtain by contacting your city, county and state government offices. Before you start your own business, find out what laws govern your type of retail store. Consider consulting with both a lawyer and an accountant, as each will help you properly organize your business.

 

7) Find a Location

 

Where you choose to locate your retail business will have a major impact on everything your shop does. The difference between selecting the wrong location and the right site could be the difference between business failure and success.

 

8) Buy Wholesale Products to Resell

 

A successful retail business depends greatly on offering the right product, at the right price, at the right time. Therefore, it is paramount to the success of your business to be able to locate the best sources for those products. As you take this step to starting a retail business and decide what products or product lines you would like to sell, it's then time to find places to buy those items at wholesale.

 

9) Establish Store Policies

 

The best time to establish policies and procedures for your retail business is during the planning stages. By anticipating problems before you open your doors, you can choose how you'll handle special situations, as well as the normal day to day operations. This helps avoid making mistakes once you're faced with customers.

 

10) Spread the Word

 

Before you open a retail store, start spreading the word. Create a retail marketing plan, brainstorm sales promotion ideas, begin branding and advertising your retail store. Learn how to use loss leaders, media buys and sales events to the benefit of your retail shop.

First evidence of Organized Retail (Shopping Mall) in India

In Manusmriti and Kautily's Arthshastra you will find the existence of current Kirana Stores. It also provides the guidelines for customer service, price, guarantees and after-sales service even tax system for retail. Harappan civilization also records the existence of  market.

The first evidence of organized retailing in India probably found in Kolkata. Way back in January 1st 1874 The Hogg Saheber Bajaar, a name which is sometimes still used alongside, the New Market opens it's door to the English People. New Market was formally christened Sir Stuart Hogg Market on December 2, 1903.The East India Railway Company executed the designs and with a renowned architect R. Bayney, pitching, an architecturally Gothic market-complex. Bayney was honoured with a 1000 rupee award. 

New Market’s growth kept pace with the city’s urbanization endeavours until World War II. The northern portion of the market came up in 1909 at an expense of 6 lakh rupees. Finally, beneath the gathering clouds of World War II, an extension on the south flanks was engineered. A finale to these structural expansions in the 1930s was the installation of New Market’s historic clock-tower.A fire burned down large portions of the original building on December 13, 1985. It has since been rebuilt, and provided with a new wing. This new wing has come to be called as the New Market.

Affluent Englishmen shopped at exclusive retailers like Rankin and Company (dressmakers), Cuthbertson and Harper (shoe-merchants) and R.W. Newman or Thacker Spink, the famous stationers and book-dealers.It has around 2000 stalls to shop with in proper order of merchandise plan. Each row of stall deal with similar line of goods. At that time no advertisements or encroachments were allowed even they are not allowed to block the corridors and paths. There were a garden with a fountain where shoppers gathered to chat. Begging and pestering were forbidden. Even the registered coolies were introduced in 1895 where registration fee was five annas and all collies had to wear uniform and a number badge.

Thus, this was probably the first phase of organized retailing now India has to go long. Let's watch.......

Definition of Value in context of retail

What is the value for a customer on his purchase from a retail shop?

Here I tried to define in a little mathematical context the value for a customer for his purchase.

Emotional Benefit- The brand name that associated with the product brings the emotional benefit. The bigger the brand name the more benefit to customer emotionally it gives the customer social recognition.

Rational Benefit- The quality of material of the product, functionality, durability & usages. More better more benefit to customer.

Physiological Cost- Music, air-conditioning, décor, ambiance, cleanliness, etc. More better of them decrease the Physiological cost.

Physical Cost- Trolleys, wheel shopping bags, home delivery, phone booking etc.

Money Cost- Money that the customer pay for the product. Discounts & freebies etc. Less is always better to customer.

Time Cost- Store directional map, product information & promotional signage, lift & elevators, store customer care staffs & billing counter on each floor, nice & easy display of products. More better of them decrease the Time cost.

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We know very well that if numerator is more and denominator is less than value is always more. The main aim of retailer should be to keep more as far as possible to the Emotional Benefit & Rational Benefit and less as far as possible to the Physiological, Physical, Money & Time costs.

Though it is not possible to convert above aspects to numerical value as all above components are qualitative aspects. I just tried to give example to make it more clear.