ASTRA’S INSIGHTS
FUELING YOUR STORE’S INNOVATION WITH
Y
Benchmarking ✓
by Kathleen McHugh, president, American Specialty Toy Retailing Association (ASTRA) ear-over-year sales, average ticket per transaction, gross margin, sales per square foot, profit—your store’s financial reports can tell you how you are doing in comparison to your own last quarter or last year and help you monitor your progress toward your goals. But how do you measure your store’s performance against other retailers, especially the best in the business? How do you look externally to find what is working for other independent retailers and use that information to take your own store to the next level? That’s where the Performance Survey, conducted every two years by the American Specialty Toy Retailing Association (ASTRA), comes in. This is a free benchmarking service we offer to ASTRA retail members. It compares your store’s financial performance to both the average ASTRA retailer and high-performing ASTRA stores. Participating retailers also receive a free report with industry averages for independent stores as a whole across different industries. ASTRA’s commitment to this member service is built on the premise that benchmarking is a valuable tool for managing your business. Benchmarking can fuel your efforts to: • Identify your store’s strengths and opportunities for growth. • Set aggressive but realistic goals. • Focus on establishing market-driven goals. • Identify areas to cut costs. • Reassess what is possible and move away from “the way it’s always been done.” • Learn from other retailers, which is one of the premises on which ASTRA was founded. • Better prioritize and allocate resources. • Identify specific ideas for improving your operations, marketing, and profit. • Recharge your enthusiasm and energy for innovation. Benchmarking is most effective when it is done on a consistent
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schedule, when it captures consistent data points so trending can be monitored, and when it includes performance results from a large number of participants. ASTRA’s long-term commitment to its Performance Survey reflects the value ASTRA volunteer leaders place on this business tool. Here’s how it works: ASTRA retailers provide data points in several categories plus the store’s year-end balance sheet and income statement. The metrics we collect include footage of selling space, number of employees by function, estimated average sale per transaction, number of stock-keeping units (SKUs) carried, number of suppliers, amount of sales in each product category, and average inventory. Your store’s numbers, which are strictly confidential, are combined with those of all reporting stores to build averages. Participants receive a free 25-page report that offers suggestions for improving profitability. A key tool is the Performance Scorecard, which gives you an at-a-glance look at whether your store’s results in key areas are strong, good, fair, or needing attention. You can instantly pick out the weak spots, and start planning how to fix those problem areas by using an online tool that will help plan and cost out critical improvements. The creator and analyst of ASTRA’s annual Performance Survey—Dr. Al Bates of the Profit Planning Group—will present a session on improving the bottom line for specialty toy stores at ASTRA’s Marketplace & Academy (June 8 to 11 in Phoenix). l Does ASTRA’s Performance Survey make a difference to its members? “The first year I received the Performance Survey, I debated filling it out and sending it in because it does take a bit of time,” says Phil Wrzensinski, owner of Toy House and Baby Too in Jackson, Mich. “The results were a big surprise for me. I found, in essence, lost money. And when I focused on correcting the area where I was out of alignment with other stores, the result was the biggest profit our store has seen in decades.”
SPECIALTY TOYS & GIFTS