Retailer financial strategy

Retailer financial strategy integrate the retailer

financial objective and goal, which retailer
develop their strategy to build a sustainable
competitive advantage to generate a desirable
profit.
Retailer objective and goal. the first step in retailer
strategic planning is to set objective:
Goals - goal are long-term aims that you want to
accomplish.
Objectives - That can be achieved by following a
certain number of steps
There are different objective which retailer set it in
the planning stage.
(1) Financial objective - when assessing financial
performance, most business focus to earn profit,
what were the retailer profit ,such as profit of the
last year and what will they be this year and into
the future.
 (2) Societal
objective
Societal objective of the retailerrelated to
broader issue about providing benefits to
society, for example retailer might be
concerned about providing job opportunity
for people in a particular area.
Other societal objective might include offering
unique merchandise ,as well as providing
innovative services which improve personal
health, such as weight reduction program .
 (3) Personal
objective.
Many retailer particular owner of small,
independent businesses, have important
personal objective ,including self gratification
,status ,and respect., whereas personal and
societal objectives are important but the
primary focus of any retailer to achieve our
financial object.
 Strategic profit
model
The strategic profit model is a method which
summarizing the factor that affect a firm
financial performance. these factor are,
(1) Net profit margin - simply how much profit
(after tax) a firm earn it.
(2) Assets turnover - assets turnover is the retailer
net sales divided by its total assets. This
financial arrangement measuring the
productivity of a firm.
(3)Customer return - customer return
represent the value of merchandise that
customer return in the form of purchasing
merchandise.
(4)Gross margin-gross margin also called gross
profit.net sales minus cost of good sold.
 Assets management
path
The information used to analyze a retailer assets
management path primary comes from the firm
balance sheet. Balance sheet represent the
retailer financial position at a given point in time.
it represent assets liabilities and owner equities.
(1) Current assets…..by accounting definition
current assets are those assets that can be
normally converted into cash within one year.
such as account receivable .inventory and so
on.
 (2) Fixed
assets
• An asset with a long-term useful life that a
company uses to make its products or
provide its services. Strictly speaking, a fixed
asset that business can not want to sell it
quickly.
Setting and measuring
performance
objectives.
Performance measurement helps determine the
progression of employees. Performance
measurement can be used in a wide variety of
industries to measure the progress of
employees. By measuring performance, a
supervisor can determine whether or not goals
are being met. To effectively monitor
performance, you must set following certain
objectives.
 Con
….
• Quantity/Quality
– One of the main objectives in performance
management in a retail environment is to determine
the ratio of quantity to quality. Managers should
establish a short-term selling goal for an employee.
This could be a weekly or monthly goal. For a new
employee, set the goal low so the employee can
take the time to effectively learn selling methods
and product knowledge without feeling pressured
to sell a vast number of products.
• Timeliness
Recording the amount of time it takes an
employee to complete a task is a vital
performance measurement tool. The
objective in recording the timeliness of
employees is to help point out potential
problem area.
 (3)
accountability
At each level of the business retailer need
to accountable the total expenses, per
day expenses as well as per year .
(4) Store operation measurement….the
critical assets controlled by store
management are the use by store space
that how many merchandise we need it
and where we need to place it.