Retail Math Cheat Sheet

Data for 13 Wks: The Premier

LY POS Sales $1,000,000 Des+na+on For
TY POS Qty 240,000
TY POS Sales $1,200,000 Walmart Supplier
TY Ship Cost $1,040,000 Educa+on
TY Ship Retail $1,300,000
TY Markdowns $60,000
Current Inv @ Retail $369,200 Learn more about class or
Weeks On Hand 4.00 custom training.
Avg Inv @ Retail $380,000 Call (479) 715-6700 or email
Avg Inv @ Cost $304,000 contact@8thandwalton.com.

Volume Measures Calcs Abbreviations:

Sales Increase % Sls Inc% = (TY Sls - LY Sls)/LY Sls 20.0%
LY Sales LY Sls = TY Sls/(Sls Inc % + 1.00) $1,000,000 Sls: Sales. Could be units or dollars. POS Qty is
TY Sales TY Sls = LY Sls * (Sls Inc % + 1.00) $1,200,000 sales units. POS Sales represents sales dollars.

Average Price Avg Px = POS Sales/POS Qty $5.00 MU: MARKUP. Usually represents initial margin
POS Sales SLS = POS Qty * Avg Px $1,200,000 percentage (MU%)
POS Qty Qty = POS Sales/Avg Px $240,000
MD: Markdowns. Usually represents markdown
dollars as a percentage of retail sales dollars (MD
Profitability Measures Calcs %).
Initial Margin MU% = (Rtl-Cost)/Rtl 20.00%
Cost Cost = Rtl * (1.00 - MU%) $1,040,000 GMROII or ROI: Used interchangeable,
Retail Rtl = Cost / (1.00 - MU%) $1,300,000 represents Gross Margin Return on inventory
investment, or simply Return on Investment.
Markdown % MD% = MD$/POS Sales 5.00%
Markdown $ MD$ = POS Sales * MD% $60,000 RTL: Retail
POS Sales Sales = MD$ / MD% $1,200,000
W.O.H.: Weeks on Hand. Number of weeks
Maintained Margin MM% = MU% - MD%Cost 16.00% worth of sales that is currently in inventory. 13
MD% Cost = MD%Rtl*CC% 4.00% WOH means that current inventory levels are
CC% = 1.00 - MU% 80.00% equivalent to 13 wks worth of sales.
therefore===> MM% = MU% - (MD% * (1.00 - MU%)) 16.00%
therefore===> MM% = MU% + (MD% * MU%) - MD% 16.00% GP: Gross Profit. Could be dollars (GP$) or
Initial Margin MU% = (MM% + MD%)/(1.00 + MD%) 20.00% percent of retail sales (GP%).
Markdowns MD% = (MM% - MU%)/(MU% - 1.00) 5.00%
CC: Cost Compliment. The opposite of MU% or
Asset Efficiency Measures Calcs MM%. If MU% is 20%, the CC% is 80%. If MM%
Inventory Turns (ANN) Turns = Ann Rtl Sls/Avg Rtl Inv 12.63 is 16%, then CC% is 84%.
Ann Rtl Sls Ann Rtl Sls = Avg Rtl Inv * Turns $4,800,000
Avg Rtl Inv Avg Rtl Inv = Ann Sls / Turns $380,000 INV: Inventory.
Shortcuts===> Turns = 52 / W.O.H. 12.63
W.O.H = 52/Turns 4.12 MM%: Maintained Margin

Return on Investment ROII = Ann GP$ / Avg Cost Inv 2.53 PX: Price
Ann GP$ Ann GP$ = Avg Cost Inv * ROII $768,000
Avg Cost Inv Avg Cost Inv = Ann GP$/ROII $304,000 Avg: Average
Shortcut===> ROII = (MM% / MMCC%) * Turns 2.41
MM% = (ROII/Turns)/(1.00 + (ROII/Turn)) 16.00%
Turns = ROII/ (MM%/MMCC% 12.63

To learn more about doing business with Walmart

Call: (479) 715-6700
Email: contact@8thandwalton.com
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