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Like-to-Like/
Like-for-Like
Growth
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Introduction
 Like-for-like growth is used as an adjusted growth metric that includes
revenue generated or volume sold from stores with similar characteristics
while omitting any with distinct differences that could skew the numbers.
 It serves as a method of financial analysis that is used to identify which of a
company's products, divisions, or stores are contributing to its growth and
which are lagging. It also excludes extraneous factors that could artificially
inflate or deflate the numbers, such as a major foreign acquisition.
 It is commonly used when making granular sales comparisons, such as
comparing sales in specific regions or comparing two retailers selling
identical products.
 As in any financial analysis, like-for-like data can be compared to the same
quarter in a previous year, the prior quarter, or across several sequential
quarters.
 It commonly controls openings and closings by including only locations
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Benefits
Retail companies use the like-for-like metric most often for their insight into
existing stores versus newly opened stores.

 If a retail company has a high like-for-like store sales growth rate and a high
total revenue growth rate, it can be seen as a sign that established stores
are driving growth. If a company has an average like-for-like store sales
growth rate but a high total revenue growth rate, it can be a sign that new
stores or new products are drawing shoppers' attention.

 Like-for-like sales metrics help companies know if a product or store is

contributing to its bottom line and if it is experiencing desired growth.

 It can also help companies decide whether opening a new location or

expanding production is worthwhile.

 Also, like-for-like sales can reveal if a new store is taking sales away from
established locations, which is known as cannibalization.
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Examples
 McDonald's Corp. reported a global comparable sales increase of 7.5% in the first quarter of
2021 with a U.S. comparable store sales increase of 13.6%, while total sales/revenues
increased 9% overall. What does that tell us? McDonald's opened a lot of new stores but
existing store sales grew relatively modestly.

 British pizza chain Domino's Pizza UK & Irl Plc said on Feb 19, 2008 that its like-for-like sales
were up 11.0 per cent in the first six weeks of 2008, down from 14.7 per cent over the whole
of last year.

 If a business had 10 stores one year and opened another 10 stores in the first month of the
next year, for example, it would probably use like-for-like analysis of sales to accurately state
growth in overall sales. Otherwise, the company would be comparing the sales of 10 stores
one year with the sales of 20 stores the following year. In like-for-like sales analysis, the 10
new stores would be ignored, and only the 10 original stores would be used for analysis. The
following year, however, the 20 stores could be compared to the 20 stores the year before to
establish like-for-like numbers. If, however, three stores closed, then the remaining 17 stores
would only be compared to the sales numbers for those 17 stores the previous year to
generate like-for-like sales numbers.