Test Your Knowledge – Retail Math Quiz
(Answers are at the Bottom of the Page)
1.) What are the 6 Pillars of Retail?
2.) A product’s retail price is $79.95 and it costs $42.00. What is the Gross Margin of this product?
3.) What is the Mark-up for the same product?
4.) A store’s annual sales are $3,560,250. Monthly inventory is as follows:
Based on these numbers, calculate the inventory turns for the year.
Hint: Calculate Average Inventory first.
5.) Utilizing the already calculated Gross Margin, Sales and Average Inventory, find out what the GMROII would be for this store, for the same year.
6.) We want to utilize GMROF to compare two display fixtures of different design:
Fixture 1: Oval shape with merchandised area of 7.65 square feet. Sales generated from this fixture in one month are $3,465 and Gross Margin on those sales is 43.5%.
Fixture 2: Rectangular shape with merchandised area of 7.20 square feet. Sales generated from this fixture in one month are $2,987 and Gross Margin on those sales is 45.6%.
Which fixture is more profitable?
7.) We want to compare the contribution of staff between two stores. Here is the data we have:
|Store||Sales This Month||Gross Margin||Total Payroll|
Which store’s staff is contributing more?
8.) Here is some store data collected through POS and Traffic Counters:
# of people who entered the store – 1,362
# of sales tickets generated – 398
Total number of units sold – 724
Total payroll for the same period – $3,842
Total sales generated – $34,548
Calculate the following:
1. Conversion Rate
2. Average Sales per Transaction
3. Units per Transaction
4. Wage Cost
9.) Here is the overall company data for the 3rd quarter sales:
Calculate this year’s performance compared to Last Year and compared to Target for each month and for the 3rd Quarter.
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Answers to the Retail Math Test
1.) People, Place, Product, Price, Promotion, Pixel
4.) 2.66 turns (Avg. inventory is $1,336,770)
6.) Fixture 1 is more profitable. (GMROF for fixture 1 is 197; GMROF for fixture 2 is 189)
7.) Store #1 is contributing more. (GMROL for Store 1 is 269.33; GMROL for Store 2 is 264.28)
8.) Conversion Rate is 29.2%, Average Sales per Transaction is $86.80, Units per Transaction are 1.82, Wage Cost is 11.12%
9.) July – 107.7% of LY, 102.6% of Target
August – 104.1% of LY, 99.1% of Target
September – 106.8% of LY, 101.7% of Target
Total Q3 – 106.2% of LY, 101.2% of Target
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