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AGENDA

RETAIL AUDIT
CONCEPT
What is Retail Audit?

Establishing Outlet Population & Stores Surveyed

Collecting the Data

Statistical Expansion

Analyzing & Interpreting the Data

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WHAT IS RETAIL AUDIT?

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WHAT IS RETAIL AUDIT?

A survey performed by way of collecting data from pre-

determined Stores / Retailers and is conducted periodically

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DATA COLLECTED FROM VARIOUS STORE TYPES

Tracking what is happening in the retailer…

- Through Scan Data (electronic data) and/or Manual Auditing
- Monthly

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PURPOSE OF RETAIL AUDIT

The purpose of Retail Audit is understanding the performance of a company and its
brand compared to their competitors in the market

Is the price of a product

How big is the market share competitive?
of a certain brand?

How much is the stock of a

What is its level of availability product in the market?
in the market (distribution)?

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 ESTABLISHING OUTLET
POPULATION & STORES
SURVEYED
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UNIVERSE AND PANEL

UNIVERSE PANEL

What is the meaning of Universe / What is the meaning of

Population? Panel?

Universe/Population is all the outlets / retail stores • Panel is a small sample of a Universe
that sells a certain product in a certain • Intended to mirror the Universe
geographical location • Visited regularly to gather the required
information

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RETAIL ESTABLISMENT SURVEY
Before planning for Retail Audit,
we need to conduct Retail
Census to count the total
population of Retail Outlets
Available statistic data cannot
fulfil our definition and need
Information taken in the survey:
Outlet details
(name, address, contact person etc.)
Store type
Selling area
Situation (main street, secondary
street etc.)
Number of check-out machines
Number of store staffs
Years of business / ownership changes
Ownership type
Service type (Self service, assisted by store
owner)
Telephone number
Refrigerator availability
Products sold (e.g. dishwashing liquid,
toothpaste, instant noodle, cigarette,
shampoo, etc)
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SAMPLE DESIGN

Nielsen employs Stratified Disproportionate Systematic Random

Sampling

Store Audit is performed manually

Auditor will visit every store every
(computer generated forms),
month on the same date. Average
electronic (handheld devices), or
time variation is 30 days
scan data sent by modern stores
Stratified
•Clustering by region, shop types and turnover.

Disproportionate
•Determine the number of samples of each cell since
eachData
cellrecorded
requiresfor
different number
every SKU by of samples as
auditors:
representatives. All product in display shelves /
• Stock in the outlet (inside shop
racks, baskets, and promotional
area and storage area)
stands etc. will be recorded
• Purchases made by the outlet
for the past month
Systematic Random Sampling
• Average selling price
•Samples are picked systematically at fixed interval with
a random starting point.

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SAMPLE DESIGN

Why use such a complicated method?

Store Audit is performed manually

Auditor will visit every store every
(computer generated forms),
month on the same date. Average
electronic (handheld devices), or
time variation is 30 days
scan data sent by modern stores

Imagine the Universe a jar of candies..

Data recorded for every SKU by Which candies we will pick to get a taste
auditors: ofAll
the whole jar?
product in display shelves /
• Stock in the outlet (inside shop
racks, baskets, and promotional
area and storage area)
stands etc. will be recorded
• Purchases made by the outlet
for the past month
• Average selling price

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SAMPLE DESIGN

Nielsen stratified the universe based on its area, type, and Turnover

Store Audit is performed manually

Auditor will visit every store every
(computer generated forms),
month on the same date. Average
electronic (handheld devices), or
time variation is 30 days
scan data sent by modern stores
10 Large Provision
with Cigarette Sales
>= 1000 Stick per
day

15 Small Provision Then we will calculate the number of

with Cigarette samples needed in each strata based on
Data recorded for every SKU by its variety
Sales > 200 – 999
auditors:
All product in display shelves /
Stick in
• Stock per
theday
outlet (inside shop
racks, baskets, and promotional
area and storage area)
stands etc. will be recorded
• Purchases made by the outlet
for the past month
30 Warung with
• Average selling price
Cigarette Sales <=
199 Stick per day

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STORES SURVEYED

There are two types of stores

that will be surveyed

MODERN TRADE TRADITIONAL TRADE

Hyper / Super Provision* : Large, Medium, Small

(e.g. Hypermart, Superindo, etc) Semi Permanent Shop*
Minimarket High Traffic*
(e.g. Indomaret, Alfmart, etc)

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TRADITIONAL TRADE
PROVISION STORES
• Stores with permanent building, usually located in
housing areas
• Also called General Trade
• Criteria of Warung, Small Provision, and Large
Provision will be determined by
cigarette turnover (stick / day)
SEMI RETAILERS
• Stores that sell FMCG products and most of their
product sell to other retailers, though they also sell to
end consumer with small proportion
• Criteria for Semi Retailer : 60% to 99% of their revenue
coming from trading with other retailer/small retailer
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TRADITIONAL TRADE

SEMI PERMANENT SHOPS HIGH TRAFFIC

• Also known as “Kios Rokok” Traditional stores (can be permanent or semi

• Semi permanent building permanent) that is located on high human
traffic areas
For example: wet market, bus station, schools,
etc

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 MODERN TRADE

MT HYPERMARKET MT SUPERMARKET MT MINIMARKET

Organized self-service store
Products are price marked either on the product or on the shelf
Shopping Basket/Carts provided for customers
Full range of personal care, home care, foods, commodity in all pack sizes

•Has 20 checkouts or above with
cash registers
•Selling area is generally 2500m2 or
above
•Example for Hypermart: Lotte Mart
•Has 3 - 19 checkouts with cash
registers
•Sales area is at least 200m2
•Example for Supermarket:
Foodmart, Ramayana, Superindo.
•Has 1-2 checkouts with cash
registers
•Sales area is generally 50m2
•Example for Minimarket: Alfamart,
Circle-K, Indomart etc

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 DATA
COLLECTION

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DATA COLLECTION

Store Audit is performed manually

Auditor will visit every store every
(computer generated forms),
month on the same date. Average
electronic (handheld devices), or
time variation is 30 days
scan data sent by modern stores

Data recorded for every SKU by

auditors:
All product in display shelves /
• Stock in the outlet (inside shop
racks, baskets, and promotional
area and storage area)
stands etc. will be recorded
• Purchases made by the outlet
for the past month
• Average selling price

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DATA COLLECTION

Every month, auditor will visit the same outlet on the same day
as the previous month visit

To ensure Nielsen Retail Audit can get all data according

reporting calendar, the following standard is applied:

• The period of audit for Indonesia is 30 days

• Monthly audit must fall between 27 – 33 days from previous audit, with 30 days as the
average

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STATISTICAL
EXPANSION

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STATISTICAL EXPANSION

is determined by
is not a measure of
SAMPLING Standard Error and when
mistakes
ERROR stated in percentage, it is
called Relative Standard
Error

STANDARD
ERROR

is the probability that the

true value lies between a
certain range of
measurement
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 CONCEPT OF STANDARD ERROR

Sample size will affect standard error the larger the

sample size, the smaller the standard error will be

STANDARD
ERROR

For Nielsen RTA, there are two Nielsen standard for Sampling Error:
implications: For product with ND above 80%, RSE
of sales volume is:
To reduce the sampling error by half, we
will need to quadruple the number of
National Market ±3% S.E.
sample
Major Markets (region) ±6% S.E.
Accuracy in the National level will be
Minor Markets (cities) ±6-10% S.E.
better than areas with smaller market
breakdown (RSO/ASO)

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CONCEPT OF STANDARD ERROR… (1)

30 DOTS/SQ IN.
120 DOTS
SAMPLE SIZE = 120

WHAT CAN YOU SEE?

WOMAN
AGE 34 - 44

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CONCEPT OF STANDARD ERROR… (2)

100 DOTS/SQ IN.

400 DOTS
SAMPLE SIZE = 400

WHAT CAN YOU SEE?

WOMAN
AGE 34 - 44
HEALTHY
LIVES IN THE URBAN AREA

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CONCEPT OF STANDARD ERROR… (3)

400 DOTS/SQ IN.

1600 DOTS
SAMPLE SIZE = 1600

WHAT CAN YOU SEE?

WOMAN
AGE 34 - 44
HEALTHY
LIVES IN THE URBAN AREA

DRESSED UP

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 ANALYSIS &
DATA INTERPRETATION

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4 DIMENSIONS OF RETAIL AUDIT

Sales (Volume, Value) Total National

Shares RSO/ASO
Distribution Trade Channels
OOS (GT/MT)
Av. Price
Purchase
Stock
etc… FACT MARKET

PRODUCT PERIOD

Total Category Monthly

Manufacturers Quarterly
Brands YTD
SKUs MAT

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FACT

% $
Numeric Distribution
Sales Volume (000 stc) Price / Pack (IDR)
= Store Carry “X” / Total
= Previous Month Stock + = Average RSP
Store
Purchase Volume – Current
Month Stock
Weighted Distribution Average Price / Stick
= Industry Volume of Store (IDR)
SoM (%) Carry “X” / Total Industry = Average Price / Pack /
= “X” Sales Volume / Total Volume Sticks
Industry Volume
Numeric OOS
= Store Not Available “X” /
Total Store

Weighted OOS
= Industry Volume of Store
Not Available “X” / Total
Industry Volume

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 FACT
Purchase Volume (stc)
= Total Purchase (based on
invoice)
Purchase Share (%)
= “X” Purchase Volume /
Total Purchase Volume
Purchase Distribution (%)
= Store Purchase “X” / Total
Stores
Stock Cover Days (day)
Stock Volume (stc)
= (Stock Volume / Sales
= Total stock (based on
Volume) x #Days of the
stock count)
Month
Stock Share (%)
= “X” Stock Volume / Total
Stock Volume
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HOW TO CALCULATE MARKET SHARE?

Total Cigarette Sales

In Jakarta
45 Billion Sticks

A Mild Vol
In Jakarta
6 Billion
Sticks

A MILD volume share in Jakarta :

= A Mild Vol / Total Cigarette Vol
= 6 Billion sticks/ 45 Billion sticks
= 13.3%

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DISTRIBUTION

SALES SALES SALES SALES SALES

250 MIO 50 MIO 250 MIO 250 MIO 200 MIO

A MILD A MILD A MILD A MILD A MILD

AVAILABLE DO NOT CARRY AVAILABLE AVAILABLE OUT OF STOCK

NUMERIC WEIGHTED

DISTRIBUTION 4 / 5 * 100 = 80% 950 / 1000 = 95%

OUT OF STOCK 1 / 5 * 100 = 20% 200 / 1000 = 20%

IN STOCK 3 / 5 * 100 = 60% 750 / 1000 = 75%

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OUT OF STOCK

ND OOS Sales Stock Purchase Invoice

Yes No

Yes No

Yes Yes

Yes No

Yes Yes

Yes Yes

No

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Thank You
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