Retail Math Cheat Sheet
Data for 13 Wks:
LY POS Sales
TY POS Qty
TY POS Sales
TY Ship Cost
TY Ship Retail
TY Markdowns
Current Inv @ Retail
Weeks On Hand
Avg Inv @ Retail
Avg Inv @ Cost
The Premier Des+na+on For Walmart Supplier Educa+on $1,000,000
240,000
$1,200,000
$1,040,000
$1,300,000
$60,000
$369,200
4.00
$380,000
$304,000
Volume Measures
Learn more about class or custom training. Call (479) 715-­‐6700 or email contact@8thandwalton.com. Calcs
Sales Increase %
LY Sales
TY Sales
Sls Inc% = (TY Sls - LY Sls)/LY Sls
LY Sls = TY Sls/(Sls Inc % + 1.00)
TY Sls = LY Sls * (Sls Inc % + 1.00)
20.0%
$1,000,000
$1,200,000
Average Price
POS Sales
POS Qty
Avg Px = POS Sales/POS Qty
SLS = POS Qty * Avg Px
Qty = POS Sales/Avg Px
$5.00
$1,200,000
$240,000
Profitability Measures
Calcs
Initial Margin
Cost
Retail
MU% = (Rtl-Cost)/Rtl
Cost = Rtl * (1.00 - MU%)
Rtl = Cost / (1.00 - MU%)
20.00%
$1,040,000
$1,300,000
Markdown %
Markdown $
POS Sales
MD% = MD$/POS Sales
MD$ = POS Sales * MD%
Sales = MD$ / MD%
5.00%
$60,000
$1,200,000
Maintained Margin
MM% = MU% - MD%Cost
MD% Cost = MD%Rtl*CC%
CC% = 1.00 - MU%
therefore===> MM% = MU% - (MD% * (1.00 - MU%))
therefore===> MM% = MU% + (MD% * MU%) - MD%
Initial Margin
MU% = (MM% + MD%)/(1.00 + MD%)
Markdowns
MD% = (MM% - MU%)/(MU% - 1.00)
Asset Efficiency Measures
Inventory Turns (ANN)
Ann Rtl Sls
Avg Rtl Inv
Shortcuts===>
Return on Investment
Ann GP$
Avg Cost Inv
Shortcut===>
Turns = Ann Rtl Sls/Avg Rtl Inv
Ann Rtl Sls = Avg Rtl Inv * Turns
Avg Rtl Inv = Ann Sls / Turns
Turns = 52 / W.O.H.
W.O.H = 52/Turns
ROII = Ann GP$ / Avg Cost Inv
Ann GP$ = Avg Cost Inv * ROII
Avg Cost Inv = Ann GP$/ROII
ROII = (MM% / MMCC%) * Turns
MM% = (ROII/Turns)/(1.00 + (ROII/Turn))
Turns = ROII/ (MM%/MMCC%
Copyright 2013 - 8th & Walton, LLC
16.00%
4.00%
80.00%
16.00%
16.00%
20.00%
5.00%
Calcs
12.63
$4,800,000
$380,000
12.63
4.12
2.53
$768,000
$304,000
2.41
16.00%
12.63
Abbreviations:
Sls: Sales. Could be units or dollars. POS Qty is
sales units. POS Sales represents sales dollars.
MU: MARKUP. Usually represents initial margin
percentage (MU%)
MD: Markdowns. Usually represents markdown
dollars as a percentage of retail sales dollars (MD
%).
GMROII or ROI: Used interchangeable,
represents Gross Margin Return on inventory
investment, or simply Return on Investment.
RTL: Retail
W.O.H.: Weeks on Hand. Number of weeks
worth of sales that is currently in inventory. 13
WOH means that current inventory levels are
equivalent to 13 wks worth of sales.
GP: Gross Profit. Could be dollars (GP$) or
percent of retail sales (GP%).
CC: Cost Compliment. The opposite of MU% or
MM%. If MU% is 20%, the CC% is 80%. If MM%
is 16%, then CC% is 84%.
INV: Inventory.
MM%: Maintained Margin
PX: Price
Avg: Average
To learn more about doing business with Walmart
Call: (479) 715-6700
Email: contact@8thandwalton.com
Visit: www.8thandwalton.com