Kasi Kicks Business Plan — Key Performance Indicators
The sell-through, markdown, revenue per square metre and stock-turn indicators reported weekly, with targets and thresholds.
Key Performance Indicators
Jump to section
- Overview & contents
- i. Important Notice and Basis of Preparation
- 1. Allocation: What You Are Allowed to Sell
- 2. Executive Summary
- 3. The Size Curve: Where Footwear Margin Is Lost
- 4. The Store and the Channel
- 5. SWOT and Competitive Position
- 6. Organisation and Compliance
- 7. Financial Plan
- 8. Break-Even and Debt Service
- 9. Investment Analysis
- 10. Sensitivity and Scenario Analysis
- 11. Risk Analysis
- 12. Implementation Roadmap
- 13. Key Performance Indicators
- 14. Key Assumptions
- 15. Conclusion and Recommendation
- A. Appendix A: Consolidated Financial Summary
- B. Appendix B: Allocation, Size Curve and Store Schedules
- C. Appendix C: Funding, Debt and Stock Schedules
- D. Appendix D: Risk Register
- E. Appendix E: Glossary
The following are the operating measures on which this group should be managed. Three of them — trading density, sell-through by size, and stock cover in days — are reported weekly, because a footwear buy is committed a season ahead and the only chance to correct it is before the next order goes in.
|
Indicator |
Definition |
Target |
Why it matters |
|---|---|---|---|
|
Trading density |
Store revenue divided by trading area |
R83358 per m² at maturity |
Break-even is R33387. The number a landlord and a lender both ask for |
|
Full-price sell-through |
Units sold at full price divided by units bought |
73% |
Against a degraded industry norm near 50%. An 8-point movement is worth R6620676 |
|
Sell-through by size |
Units sold divided by units bought, by size |
Within 2 points of the demand curve |
Size-curve discipline is worth 20% of gross profit on identical stock |
|
Pairs sold a store a day |
Pairs sold divided by trading days |
27 at maturity |
Break-even is 14. The most tangible measure a store manager has |
|
Allocation mix by tier |
Units by tier divided by total units |
4% limited, 26% premium general release |
If the brands allocate less, the mix shifts to carryover at R257 a pair against R812 |
|
Stock turns |
Cost of sales divided by average stock at cost |
4.2 times |
Against an industry median near 4.4. Stock is 12.9% of revenue at maturity |
|
Stock cover in days |
Stock at cost divided by daily cost of sales |
Below 90 days |
Above 110 days the open-to-buy should be frozen |
|
Markdown as a share of units |
Units sold below full price divided by total units |
Below 27% |
At a 55% discount a pair earns nothing at a landed cost of R648 |
|
Attachment rate |
Accessories and apparel units divided by footwear units |
10% of units |
The highest gross margin in the store at 57% |
|
Debt service cover |
EBITDA divided by interest and capital |
Above 1.30x from Year 3 |
Negative in Year 1 by construction |
13.1 Reporting cadence and ownership
|
Measure |
Cadence |
Owner |
Source |
|---|---|---|---|
|
Sell-through by size, by style |
Weekly |
Buyer and merchandise planner |
Point of sale; the report that governs the next buy |
|
Trading density by store |
Weekly |
Managing director |
Store revenue divided by trading area, excluding online |
|
Stock cover in days |
Weekly |
Buyer and merchandise planner |
Stock at cost divided by daily cost of sales |
|
Pairs sold a store a day |
Daily |
Store manager |
Point of sale; the most tangible measure on the floor |
|
Markdown as a share of units |
Monthly |
Buyer and merchandise planner |
Units sold below full price, by tier |
|
Allocation received against requested |
Per season |
Buyer and merchandise planner |
Brand order confirmations by tier and by door |
|
Attachment rate |
Monthly |
Store manager |
Accessories and apparel units divided by footwear units |
|
Facility headroom |
Monthly |
Finance and administration |
Stock at cost against the R6 500 000 facility |
Two features of this table are deliberate. The buyer owns four of the eight measures, which reflects where the margin is actually made and lost in footwear retail. And sell-through by size is reported weekly rather than at season end, because a buy committed months ahead can only be corrected on the next order — so the value of the report is entirely in how early it arrives.