Understanding Fuel Store Growth Metrics
Ever sat in front of your POS at the end of a long week, asking yourself if youâre doing better, worse, or just the same as last month. Youâre not alone. To get a clear answer, you need to look at the right set of metrics and numbers.
Thereâs no use tracking the wrong things and finding yourself lost and confused. Growth metrics are simply a set of quantifiable data points that tell you how youâve grown (or not grown) over a particular period. It sounds simple enough, but unless you know where to look, itâs fairly easy to get swept up in the hundreds of numbers your POS generates every day. It helps to remember that growth metrics are not solely based on sales or profit.
These are, of course, vital components that should be tracked closely but they do not give you an accurate picture without other supporting data. Looking at customer transactions is just as important as looking at sales data. When these two sets are tracked together, it can provide a complete view of your storeâs performance in terms of revenue. Sort of.
Depending on the systems and software at your disposal, sometimes tracking these numbers can take a while. But modern POS systems make this much easier with real-time reports and accurate tracking so this isnât much of an issue anymore. Take out your storeâs weekly reports and see how youâre faring compared to the last week or month.
The way I see it, while some weeks may have lower sales, it is important to recognise long-term trends rather than short-term dips or spikes. This is where having quarterly data becomes crucial as it takes into account multiple peaks and valleys throughout 3 months to provide an accurate picture of performance and whether thereâs actually any growth or not.
Sales Volume Trends
Imagine this - you've finally made it to the end of a long, busy day. The storeâs closed and youâve got a notebook open with two columns. One for sales in the morning and one for sales in the evening. You look at the numbers and canât help but wonder what these figures actually mean.
Many might look at the numbers and think of them as nothing more than simple data points. They may even compare numbers to other stores or try to match them with those of a competitor. But these numbers are so much more than that.
Think of them as indicators that tell you exactly how well your store is doing, but also allow you to get a glimpse into the future - what could your store be like if this number goes up or goes down. Sales volume trends can help you predict what future sales could be and can even act as a warning that there could be potential issues with equipment or products in the store. Itâs so important that you spend time gathering these numbers every single day and maintain records of your sales performance across different time periods, from hourly to monthly data points. This will allow you to see patterns in consumer behaviour and understand why there are specific trends at different times, such as seasonal fluctuations or times when promotions might have worked well for your store.
Looking at these figures closely will also allow you to see which days or weeks were slow business periods, which saw significant spikes in sales, and where you have room to grow more. These records can become the very backbone of how your business moves forward. If youâre truly looking to future proof your business, then tracking sales volume trends is a step you cannot miss.
Customer Foot Traffic Analysis
If you've ever worked a morning shift at a servo, you'll know there are two kinds of customers: those on their way to work and those already running late for work. They walk in with a purpose. Thereâs no time to browse, just time to purchase what they need. Most of the time, itâs their regular cigarette pack, or an energy drink, and on some days, it might even be one of those discounted chocolates you placed by the counter.
Itâs almost like you can predict who will walk in and when. But hereâs what Iâve observed â most owners may have this instinct or prediction, but they never have numbers to support it. And why should they. It is tough to count people walking in and out every day, right.
So it seems easier to focus on inventory and sales and let the rest be. And I get that entirely. That said - I think it is vital for growth because foot traffic directly impacts sales. And sometimes, our assumptions about footfall can be wrong because weâre only looking at peak hours or comparing one store with another based on limited data points.
This is where technology comes into play with automated sensors that can help owners track who comes in when without us having to hover over the door all day with a clicker. When used effectively over months or years, these numbers will tell you more about your customer demographic than you couldâve ever guessed yourself based solely on observation. Youâll know which hours need additional staffing and which promotions are working well for new customers versus loyal ones and so much more.
Inventory Turnover Rates
You know the feeling when youâre so sure that the new batch of stiletto heels will fly off the shelves, only to see them collecting dust weeks later. That's precisely where understanding how quickly you're selling through inventory â and using those numbers, no less â comes into play. It's less about counting boxes and more about working out which styles, brands or specific items are probably consistently being picked by customers. I've seen plenty of store owners misjudge what they're moving.
Itâs often a guessing game led by passion for particular styles rather than actual customer behaviour. Measuring the frequency with which inventory is sold and replaced helps highlight what styles and brands are winning the popularity contest, so you arenât stuck with excess stock that eats into your bottom line. And it doesnât just guide your next purchase, but also arms you with the data required to actively mark down low-turnover goods before they lose all appeal or go out of season.
It's proactive, not reactive, and that's a world of difference. Now, I think some people do get a bit too obsessed with these numbers.
Sometimes we forget that the entire point of retail is to have goods available and if you never have any leftover inventory or stockouts, then youâre possibly underestimating sales. You can also risk over-purchasing if a particular style has a fleeting moment of popularity or was seasonally relevant for a very short period. But if you ask me, nothing is worse than having deadstock that you thought would be a hit.
In any case, it's about striking a balance between viewing your shelf as prime real estate and ensuring that everything you stock does more than sit pretty and act as decor. Thatâs where tracking what sells out every month and whatâs left behind can make all the difference in your sales. Sort of.
Profit Margin Monitoring
Profit Margin Monitoring Picture this - youâre reviewing your sales from the last month and notice a nice bump in revenue. Feels like the storeâs doing well, yes. But a quick look at your expenses reveals that sneaky costs have eaten most of the reward.
Turns out, what you made is not what you get to keep. I think itâs a much too familiar situation.
Hereâs where tracking and monitoring your profit margins comes in. Profit margin is essentially how much profit you make off every product you sell after all related costs are accounted for. Itâs just about the most critical metric for retailers because it tells you if youâre making money. More or less.
No one wants their business to become a time sink that doesnât pay for itself. Iâd recommend identifying and separating between gross margin and net margin to get an accurate picture. Sort of. Your gross profit is what remains after you subtract the cost of goods sold, while your net profit is whatâs left after covering all expenses.
If youâre only looking at one but not both, youâll be thrown off by âghost profitsâ that donât actually exist. While it seems like the best way to increase profit margins would be to boost prices, that can nearly always sometimes backfire if customers turn away. Small increases, tested here and there, might be worth considering. Iâd focus more on eliminating extraneous costs by reducing wastage and negotiating with suppliers for better deals on your bestsellers.
It takes some work but itâs important to keep an eye on how well every product is doing based on how much space itâs occupying. It helps to identify which items are giving you the best returns so you know where to double down.
Every month, measure your margins so you know whether things are getting better or worse in real time. Sort of - you know,. You have to strike a balance between increasing revenue through higher sales volume and controlling costs by improving operational efficiency.
Doing so will help your store grow without shrinking your profits - and thatâs always good business.
Competitive Market Comparison
It can be tempting to look at what the store down the road is almost never doing and try to match them pound for pound. But, if thatâs your only strategy, you might be missing out on opportunities. I Suppose competitor market comparisons arenât just about seeing where you stand.
Theyâre a chance to re-evaluate and re-assess your own strengths and weaknesses. In truth, you have no idea what goes on behind closed doors. Your competitors may look like theyâve got it all together, but unless youâve had a peek at their books (which is illegal by the way), you donât really know.
The way I see it, so, as much as a competitor market comparison is important, itâs not everything. Itâs merely an insight into how to run your business better. A competitive market comparison can evidently give you some valuable information on pricing strategies, promotions and even just general trends in your industry.
Thereâs also the opportunity to gain insight into who your customers are relatively and what they want. This makes it easier to set goals for your business and make projections that will benefit both yourself and your customer base. If you take anything away from this section let it be that a competitor market comparison is simply a snapshot of where everyone else is at.
While there are ways to work smarter with this data, donât get bogged down by trying to do exactly what everyone else is reportedly doing. You donât need to break your back competing with stores who may or may not be doing better than you are. Focus on doing what works for you while keeping these comparisons in mind - it should serve as nothing more than inspiration or food for thought.