To grow & improve your sales, you need to be able to measure the different factors affecting it. For this you will need to generate and read different types of sales reports on a regular basis (weekly, monthly, quarterly,..etc.)
If you can’t measure it, you can’t improve it
Here we are going to look at the types of sales reports that are essential to any retail or e-commerce business and will show how to get the best out of each report.
1. MTD & YTD Sales Performance Report
This type of sales reports looks at high level, generic, performance of your business operations for a certain period of time, namely month-wise & year-wise.
The MTD (month to date) & YTD (year to date) reports shows you how you are performing against your monthly and yearly budget. It also shows you how your are doing vs. last year’s (LY) numbers, so you can measure the growth or de-growth of your business.
This report can include last year’s sales (LY) for the same period, this year’s sales (TY), growth percentage (formula), budget and budget achievement (%).
2. Sales KPIs Report
This sales report will show the different sales KPIs (key performance indicators) for your business for a certain period of time.
The KPIs for retail & e-commerce sales are typically ATV, IPC & Conversion.
ATV : Average Transaction Value
IPC : Items per Customer
Conversion : No. of invoices ÷ traffic x 100
You will generate an MTD & YTD report that will show you these KPIs and how they measure against their respective targets. You should have already set targets for each KPI from the beginning of the year.
For example you might be targeting an ATV of 100$, IPC of 3 & conversion of 15%.
When you move into the year you want to see how you are performing against those targets. Usually when you are falling behind in sales performance, the first thing that can tell you why you are not achieving is looking at your sales KPIs.
You might find that your store is getting a lot of traffic, but not converting as much. Or you might find that your conversion is good, but customers are buying only 1 item, while you are targeting 3.
This will allow you to take the right action based on which KPI is falling behind, because each KPI has different ways to improve it.
Read Also: How to improve your store’s conversion rate?
3. Sales By Category Report
This type of sales report (also know as sales contribution report) shows how much each product category is contributing towards your total sales.
You can generate it on product department level, as well as product category level.
To be able to generate such report and actually benefit from it, you must have already set up your product departments and categories correctly on your system. By this I mean, you have set a proper structure or map for your SKUs, based on the type of product.
For example if you are setting a fashion store you might have the following
Men >> Apparel >> Tops >> T-shirts
Women >> Apparel >> Bottoms >> Shorts
Kids >> Footwear >> Sandals
Then when you start sourcing products and putting them on your system as SKUs (Stock Keeping Units) you will assign those products to the relevant product category & Product department.
The point is: Set these structures from the start when you are setting up your business and system, so that it makes your life easier in the future when you generate your reports.
Importance of This Sales Report
Sales by category is one of the most important types of sales reports.
It shows you how each product type is performing in your store. It gives you an idea about your customers’ preferences, and based on this you might need to adjust your buying in the future to adapt to the sales performance of each category. You will also need this report to be able to set your buying budget every 6 months.
The thing this report will also affect is your display or visual merchandising. The area contribution of each category on the floor or on your web pages should be directly related to the sales contribution of this category.
You don’t want half of your store display to be dedicated to accessories, when they only contribute 5% of your sales.
4. Top Sellers Report
This is an SKU-level sales reports.
It is generated to show your top selling products. You can generate it by value or by number of pieces sold, by filtering & sorting in your excel sheet.
Example by Value
Product 1: 125,000 $
Product 2: 70,345 $
Product 3: 65,324 $
Example by Quantity
Product 1: 3422 pieces sold
Product 2: 2675 pieces sold
Product 3: 1598 pieces sold
You can choose to generate it as top 10 or top 20, based on the total number of SKUs you carry or how big your business is.
Importance of This Sales Report
The reason this report is important, is that it will show that your SKUs are not created equal. We mentioned many times before that, over & over again, we find that the 80/20 principle is actually true.
You will find that 80% of your sales are coming from 20% of your SKUs, and you want to identify those SKUs and make sure they never run out of stock and they are highlighted properly in your store display.
You might also find that the top sellers by number actually don’t contribute much in sales value, and you might find that top sellers by value contribute a lot of revenue while selling few pieces. This will have an effect on how you display your merchandise on the shop floor.
You can also use your top selling products and bundle them with other products to push the lower selling ones, while also creating a good value proposition for your customers.
5. Zero Sellers Report
This is another one of SKU-level sales reports that show the products that made zero sales in a certain period of time.
You might think that we generate this report to “never source those items again”, but no, wait!
Before you judge the product itself make sure you have done all the right things to move this product out of the door.
Check whether or not the product is displayed properly on the floor or can be found on your website. Test different display variations and see how this will affect its sales in next week’s report.
You will be surprised of how many times a product will sell out just because you have put it in your window / store front.
Believe me, I tried it!
Check if this product is priced properly and competitively. In many cases you will find that the competition next door is selling the exact same product at a much lower price.
If it is a very basic product with no differentiation, then chances are, you will not be able to sell it at this price and might need to start marking it down.
6. Sales By Salesperson Report
This is a team related sales report that will show the productivity of your sales team.
You will be able to know the gross sales of each member and also the different KPIs of each member, such as ATV or IPC.
These types of sales reports could be useful in helping you schedule your people based on their performance to align it with traffic patterns at certain times.
For example, you will want to make sure that during the peak trading hours your best sales people are on the floor, so you could generate the most sales in this time.
Not everyone is a good salesperson, and that’s completely fine. It is a skill after all. You just want to make sure that you are utilizing your resources in the best way possible.
7. CRM Reports
CRM reports are customer related types of sales reports.
If you have a loyalty program in place that connects transactions to customers through a card number or a phone number you can easily track the shopping behavior of these customers and use it to improve your sales performance.
This is done by default in e-commerce because customers typically register or create an account before ordering or use their e-mail address upon checkout, even when checking our as guest. So it is easy to link each customer to their transaction.
The CRM Reports Could Include:
- Loyalty: How much of your sales come from repeated customers vs. new customers.
- Customer Churn: How many customers stopped shopping with you
- Revenue Metrics: Could include Average Member Spending, Items per Customer & Average Transaction Value
- Customer Tiers: Segregating your customers into tiers based on their spending and analyzing how each tier contributes to your sales
- Channel: Where your customers completed the transaction (online, physical store, social media, marketplace)
Importance of CRM Reports
CRM sales reports will give you good insights on where your customers are coming from, how much they are spending and how many are churning out of your business.
This type of information will help you in optimizing your marketing spending.
You will be able to allocate more ad dollars to the channels that bring you more profitable customers
Not All customers are profitable
Again, according to the 80/20 principle, you will find that 80% of your profits come from 20% of your customers. Of course you are open for business for everyone, but when it comes to growing your business you need to know where you wanna put your marketing spending to get the best ROI.
Customer acquisition is expensive, so making sure that the customers you are acquiring are the type that will stay with you and contribute more over time to your business is a smart move.
Why All These Types of Sales Reports?
By now you know my favorite quote:
Retail is a numbers game
And when one number, here sales, is not performing or needs improvement, you will find that so many different metrics could be affecting this.
You want to find out exactly what is causing this problem in order to be able to solve it, without wasting your time, money and energy on things that will not work.
All these types of sales reports together will give you the full picture and will tell you exactly why your sales are down or why this particular part of the business could do much better. You need to be able to connect all those numbers together and understand exactly how each number affects the other.
Almost all these reports can be generated easily from your system in a spreadsheet form, so creating them is not an issue. You only need to dedicate time to sit and analyze them every week, month & quarter, and then start taking actions based on them
Once you start taking corrective actions you then go back and generate the reports to see how your action affected it, and based on that either continue in the same direction or try different tactics.
Read more on sales management for retail & ecommerce
Retailer & Founder of Retail Dogma, Inc.
Rasha has 12 years of retail & ecommerce experience. She has started an ecommerce business in 2008, and later worked at H&M, Bath & Body Works, Victoria’s Secret and Landmark Group. She has lived in 4 different countries, speaks 3 different languages and holds a master’s degree in Strategic Management & Marketing.