Friday, 27 April 2012

Retail Metrics - Can they change suddenly ?


Dhirubhai Ambani :-


The story goes, that Dhirubhai Ambani, Reliance Group Founder Chairman, could just put his hand on any machine in his VIMAL textile plant and just by feeling the vibrations, he could tell what was right or wrong with the machine.

I am not so smart, but some thing similar happened to me today. I do a 5 minute run on the tread mill, at my gym, and on an average burn about 50 calories,  but more importantly, I will be sweating by the end and trying to catch my breadth.

Today, I seem to do 50 calories in less than 4 minutes and with hardly any effort ! While I was happy at my improvement, something told me the machine was not moving fast enough . I told my Trainer Irfan about my opinion,  he checked and confirmed, that the machine was not working properly and should be taken down for maintainence.

Learnings for a retail store :-

It is a similar instance in retail as well. Walkins are a very good indicator for a retail business. If a store is getting an average of say 50 customers ( how to measure walkins is a good subject for another day ), then if it either suddenly drops or goes up in explicably ( exceptions are advertising campaigns, weekends, holidays, festivals etc) then it shoud immediately ring alarm bells whose responsibility is to track it . Whether it is the greeter, the CSA, the store manager or the area manager. Sooner or later, you will find out the reason for the abnormal changes in the tracking format.

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