- September 22, 2019
The Way You Keep Score Determines How You Play The Game
The National Association of Convenience Stores (“NACS”) recently held its State Of the Industry (“SOI”) meeting in partnership with C-Store Petroleum trade magazine (“CSP”). Each year during this meeting, NACS releases the first look at the industry’s metrics from the year prior.
NACS has been gathering information on the industry from c-store retailers who volunteer their data for over 15 years. Its SOI Report and Fact Book are used by many retailers to benchmark their performance against those in the industry. If you don’t participate in this process you should for two principle reasons.
First, the more retailer participation the better the information. Unfortunately too many c-store retailers don’t provide data. Second, and more important to you, is that the process would quickly reveal your internal data shortfall.
We tell our clients that “the way you keep score determines how you play the game.” Unfortunately too many retailers don’t keep score very well. When we ask them for the data that they use to manage their business they either don’t have enough information or what they have is not accurate, not valid or not current. In some cases all three.
There is no way that anyone can make accurate decisions about their business without data, yet we constantly find clients that don’t collect, or report, minimal data and don’t understand why their business is in trouble.
Here is a very short checklist for information musts:
- P&L must be up to date. That means you should have last month’s no later than the 15th of the current month by store and for your company.
- P&L must reflect all revenue and expense items – fuel, c-store items, services, foodservice, etc. There should be no off the books revenue or expenses.
- P&L must accurately report your gross margin.
- This means you must take monthly inventories and reconcile them against your book inventory. If you can not do this by department, then at least do it in total.
- Gross margin should reflect rebates, discount, allowances, etc. Again, if you can not do it by department, then do it in total.
- Fuel information on fuel must include:
- Gallons purchased and sold by grade
- Gross margin by grade and in total
- Credit card fees
- Cigarette information on must include:
- Cartons sold
- Packs / multi/packs sold
Remember this is not information you need to have for benchmarking. This is information you must have to properly run your business.
If you want to what type of information the industry typically provides go to www.soisurvey.com and download the store level Excel form NACS uses to collect its data. If you can complete it, then you are on the road to having the information you need to properly run your business. If not, then you are likely on the road to ruin.
- Senior Management