NAMM Presentation

KPI
(Key Performance Indicators)

Drive Growth

Drive Growth and Profits with

a Defined Company Culture

George Hines
Georges Music, Inc.

Interior Photo

Interior Photo

Interior Photos

Research
Owners Sales Administrative

Universal Laws:

Law of
Expectation
You get what you expect

Which do you prefer?

$1,000

$10,000

$100,000 +

New Economy
Do More with Less

Problems:
Economic Recession
High Unemployment
Increased Costs
More Competition
Consumer Demands
Profit Pressures from Internet
Others?

Solution
GET CLARITY KNOW WHAT YOU WANT
Use KPI To Create
1. Accountability
2. Establish Action Plans
3. Measure Progress

KPI To Drive Sales

SALES: - Set Specific Goals for:
1.
2.
3.
4.
5.
6.
7.

PPD People per day

TPD Trans. per day
Conversion % PPD/TPD
Items per Sale
Avg $ per transaction
Gross Sales
Gross Margin %

KPI To Drive Sales

Total Days in the Month

31 Todays Date

Sales Manager KPI Report

January 2012 Performance Dashboard
SALES

Goal

PPD (People Per Day)

9,300

TPD (Transactions Per Day)

3,720

Conv % (PPD/TPD)

40.0%

Items Per Sale

AVG $ per Trans
Gross Sales
Gross Margin %

3.2
$ 55.00
$ 204,600
42.1%

31

KPI - To Drive Sales

Total Days in the Month

31 Todays Date

Sales Manager KPI Report

January 2012 Performance Dashboard
SALES

Goal

Actual

PPD (People Per Day)

9,300

9,138

TPD (Transactions Per Day)

3,720

3,780

Conv % (PPD/TPD)

40.0%

41.4%

3.2

3.3

$ 55.00

$ 56.25

$ 204,600

$ 212,625

42.1%

42.3%

Items Per Sale

AVG $ per Trans
Gross Sales
Gross Margin %

31

KPI To Drive Sales

Total Days in the Month

31 Todays Date

31

Sales Manager KPI Report

January 2012 Performance Dashboard
SALES

Goal

Actual

Forecast

PPD (People Per Day)

9,300

9,138

9,138

TPD (Transactions Per Day)

3,720

3,780

3,780

Conv % (PPD/TPD)

40.0%

41.4%

41.4%

3.2

3.3

3.3

$ 55.00

$ 56.25

$ 56.25

Items Per Sale

AVG $ per Trans
Gross Sales
Gross Margin %

$ 204,600
42.1%

$ 212,625 $ 212,625
42.3%

42.3%

KPI - Operations
OPERATIONS:
1.
2.
3.
4.
5.
6.
7.

Inventory B.O H.
R.O.I. Total Inventory
SQI score Service Quality Indicator
COGS - Cost of Goods Sold
Sales per S.F. (10,000 s.f.)
Gross Sales
Gross Margin $

KPI - Operations
Total Days in the Month

31Todays Date

Operations Manager KPI Report

January 2012 Performance Dashboard
Operations
Inventory BOH

Goal
400,000

R.O.I Total Inventory

2.40

SQI Score

92%

C.O.G. Sold

$ 120,000

Sales per s.f. (10,000s.f)

$ 20.00

Gross Sales

$ 200,000

Gross Margin $

$ 80,000

31

KPI - Operations
Total Days in the Month

31Todays Date

Operations Manager KPI Report

January 2012 Performance Dashboard
Operations

Goal

Actual

400,000

398,000

R.O.I Total Inventory

2.40

2.71

SQI Score

92%

93%

C.O.G. Sold

$ 120,000

$ 122,684

Sales per s.f. (10,000s.f)

$ 20.00

Inventory BOH

21.26

Gross Sales

$ 200,000

$ 212,604

Gross Margin $

$ 80,000

$ 89,920

31

KPI - Operations
Total Days in the Month

31 Todays Date

31

Operations Manager KPI Report

January 2012 Performance Dashboard
Operations

Goal

Actual

Forecast

400,000

398,000

398,000

R.O.I Total Inventory

2.40

2.71

2.71

SQI Score

92%

93%

93%

C.O.G. Sold

$ 120,000

$ 122,684

$ 122,684

Sales per s.f. (10,000s.f)

$ 20.00

Inventory BOH

21.26

$ 21.26

Gross Sales

$ 200,000

$ 212,604

$ 212,604

Gross Margin $

$ 80,000

$ 89,920

$ 89,920

KPI Customer Service

CUSTOMER SERVICE
1.
2.
3.
4.
5.
6.

Mystery shop scores min 85%

Mystery phone shops min 90%
Customer on line reviews min 4 stars
Vip Contacts
Events in stores goal attendence
Staff Training Sessions

KPI Customer Service

Total Days in the Month

31

Todays
Date

Customer Service KPI

January 2012 Performance Dashboard
Customer Service

Goal

Mystery Shop

92%

Phone Shop

92%

On Line Reviews

15

VIP Contacts

400

In Store Events

Training Session

31

KPI Customer Service

Total Days in the Month

31

Todays
Date

Customer Service KPI

January 2012 Performance Dashboard
Customer Service

Goal

Actual

Mystery Shop

92%

94%

Phone Shop

92%

96%

On Line Reviews

15

18

VIP Contacts

400

422

In Store Events

Training Session

31

KPI Customer Service

Total Days in the Month

31

Todays
Date

31

Customer Service KPI

January 2012 Performance Dashboard
Customer Service

Goal

Actual

Forecast

Mystery Shop

92%

94%

94%

Phone Shop

92%

96%

96%

On Line Reviews

15

18

18

VIP Contacts

400

422

422

In Store Events

Training Session

KPI Finance Department

Control Cash and

Maintain Profitability

Retail Owners Institute

KPI - Finance
Finance:
1.
2.
3.
4.
5.
6.
7.
8.

Inventory Turnover
Gross Margin % or $
Profit or Net Income Before Tax % or $
Current Ratio Assets to Liabilities
ROA - Return on Assets
GMROI
Operation costs as % of sales
Other income in $

Turnover

KPI - Finance

Net Income Pre Tax

Debt To Worth

Current Ratio Trends

Return on Assets %

KPI - GMROI

Small Goods Performance

sm goods
sales
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sept
Oct
Nov
Dec
Total
2009 313357 284671 292537 283699 269951 275187 289602 292138 267815 279016 276186 528172 3652330
2010 306271 292278 301089 276737 267481 266719 284599 288316 268924 267057 287292 534846 3641609
2011 305649 298554 302001 275049 265630 263770 294554 288541 257555 272885 292545 568745 3685478
2012 308554 302105
GM$
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sept
Oct
Nov
Dec
Total
2009 166636 150768 155964 149836 140752 142973 150474 151255 139545 141554 142892 271411 1904060
2010 166524 153551 157898 144220 138900 138504 147399 149873 141258 141166 149144 281184 1909621
2011 167854 154512 158741 143866 137859 137666 142439 152441 145112 142544 151445 284110 1918589
2012 169852 155245
COG
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sept
Oct
Nov
Dec
Total
2009 146721 133902 136573 134762 129199 132214 139128 140882 128269 132471 133294 253069 1740484
2010 145887 138726 135441 132517 123541 128215 137200 138443 124221 125891 134221 253661 1717964
2011 144567 129630 134553 131183 127771 126105 131616 125973 122986 124168 133641 252642 1684835
2012 141254 138524
GM%
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sept
Oct
Nov
Dec
Total
2009 53.18% 52.96% 53.31% 52.50% 52.14% 51.95% 51.96% 51.78% 52.11% 52.52% 51.74% 52.09% 52.35%
2010 52.37% 52.54% 55.02% 52.11% 53.81% 51.93% 51.79% 51.98% 53.81% 52.86% 53.28% 52.57%
2011 52.70% 56.58% 55.45% 52.31% 51.90% 52.19% 55.32% 56.34% 52.25% 54.50% 54.32% 55.58%
2012 54.22% 54.15%
BOH $
Jan
Feb
Mar
Apr
May
Jun
Jul
Aug
Sept
Oct
Nov
Dec
Total
2009 935414 935063 1007319 1013011 1013326 1022475 981980 1007427 1024257 1063772 1116278 1082367 12202688
2010 1024014 987380 1013304 1051535 1063541 1058996 1059922 1045619 1053361 1112593 1213175 1169621 12853061
2011 1145520 1125305 1115034 1090082 1096755 1117742 1070355 1092874 1058173 1035977 1080399 1061810 13090026
2012 1022698 1032532

Quarterly Vendor Budgeting

vendor
JBL
TAYLOR
SABIAN (AIMM)
ZILDJIAN
FENDER
KORG (AIMM)
VOX (AIMM)
ROLAND
PEAVEY
PEARL (AIMM)
LINE 6 rebate
HOSHINO (AIMM)
AT (AIMM)
DIGITECH
SHURE
CASIO
YAMAHA (AIMM)
$misc

totals:

alloc
new qtr
16000
50000
10000
8000
115000
15000
10000
75000
24000
14000
15000
160000
32000
15000
36000
12000
120000
40000
allocation
767000

Monthly Vendor Budget

vendor
JBL
TAYLOR
SABIAN (AIMM)
ZILDJIAN
FENDER
KORG (AIMM)
VOX (AIMM)
ROLAND
PEAVEY
PEARL (AIMM)
LINE 6 rebate
HOSHINO (AIMM)
AT (AIMM)
DIGITECH
SHURE
CASIO
YAMAHA (AIMM)
$misc

totals:

alloc
alloc
act
diff
new qtr
Month 1 Month 1 Month 1
16000
4800
4200
(600)
50000
15000
16540
1540
10000
3000
3020
20
8000
2400
2200
(200)
115000
34500
29552
(4948)
15000
4500
5020
520
10000
3000
3480
480
75000
22500
24500
2000
24000
7200
6800
(400)
14000
4200
4400
200
15000
4500
3875
(625)
160000
48000
52500
4500
32000
9600
9745
145
15000
4500
3850
(650)
36000
10800
9650
(1150)
12000
3600
3750
150
120000
36000
38700
2700
40000
12000
6928
(5072)
allocationalloc.
actual diff
767000
230100 228710
(1390)

Monthly Vendor Budget

vendor
JBL
TAYLOR
SABIAN (AIMM)
ZILDJIAN
FENDER
KORG (AIMM)
VOX (AIMM)
ROLAND
PEAVEY
PEARL (AIMM)
LINE 6 rebate
HOSHINO (AIMM)
AT (AIMM)
DIGITECH
SHURE
CASIO
YAMAHA (AIMM)
$misc

totals:

alloc
alloc
act
diff
new qtr
Month 1 Month 1 Month 1
16000
4800
4200
(600)
50000
15000
16540
1540
10000
3000
3020
20
8000
2400
2200
(200)
115000
34500
29552
(4948)
15000
4500
5020
520
10000
3000
3480
480
75000
22500
24500
2000
24000
7200
6800
(400)
14000
4200
4400
200
15000
4500
3875
(625)
160000
48000
52500
4500
32000
9600
9745
145
15000
4500
3850
(650)
36000
10800
9650
(1150)
12000
3600
3750
150
120000
36000
38700
2700
40000
12000
6928
(5072)
allocationalloc.
actual diff
767000
230100 228710
(1390)

Quarterly Breakdown
vendor

JBL
TAYLOR
SABIAN (AIMM)
ZILDJIAN
FENDER
KORG (AIMM)
VOX (AIMM)
ROLAND
PEAVEY
PEARL (AIMM)
LINE 6 rebate
HOSHINO (AIMM)
AT (AIMM)
DIGITECH
SHURE
CASIO
YAMAHA (AIMM)
$misc

totals:

alloc

alloc

act

diff

alloc.

act

diff

alloc.

act

diff

over/und
new qtr
Month 1 Month 1 Month 1 Month 2 Month 2 Month 2 Month 3 Month 3 Month 3 er
16000
4800
4200
(600)
4800
4154
(646)
6400
6450
50
(1196)
50000 15000
16540
1540
15000
15840
840
20000
21200
1200
3580
10000
3000
3020
20
3000
3050
50
4000
4125
125
195
8000
2400
2200
(200)
2400
2325
(75)
3200
3457
257
(18)
115000 34500
29552
(4948) 34500
31200
(3300) 46000
41500
(4500) (12748)
15000
4500
5020
520
4500
4400
(100)
6000
5925
(75)
345
10000
3000
3480
480
3000
2950
(50)
4000
3650
(350)
80
75000 22500
24500
2000
22500
21250
(1250) 30000
30150
150
900
24000
7200
6800
(400)
7200
7450
250
9600
8900
(700)
(850)
14000
4200
4400
200
4200
4100
(100)
5600
5600
0
100
15000
4500
3875
(625)
4500
4250
(250)
6000
5250
(750)
(1625)
160000 48000
52500
4500
48000
50100
2100
64000
64250
250
6850
32000
9600
9745
145
9600
9450
(150) 12800
12875
75
70
15000
4500
3850
(650)
4500
4650
150
6000
4650
(1350)
(1850)
36000 10800
9650
(1150) 10800
10200
(600) 14400
11750
(2650)
(4400)
12000
3600
3750
150
3600
3450
(150)
4800
3450
(1350)
(1350)
120000 36000
38700
2700
36000
39500
3500
48000
49500
1500
7700
40000 12000
6928
(5072) 12000
10225
(1775) 16000
15774
(226)
(7073)
0
Quarter
allocationalloc.
actual diff
alloc.
actual diff
alloc.
actual
diff
total
767000 230100 228710
(1390) 230100 228544
(1556) 306800
298456
(8344) (11290)
755710
-11290

If Its Written Its Real

Use KPI to Drive Growth:

Create Accountability
Establish Goals & Actions
Measure Progress

Thank You!
a Defined Company Culture

George Hines - President Georges Music, Inc.

ghines@georgesmusic.com

Streams of Income
Increase Profits

Streams of Income

Fast Pay Discounts

a) Current Programs
b) Future Programs
c) Credit Card Opportunities
d) One Time Events

Streams of Income

Co-op Programs
Strategy
Catalog or Buyers Guide
Online Sponsorship
Events
Promotions

Streams of Income

Rebate Programs
Current Programs
Future Programs
- Annual
- Quarterly

Streams of Income
Registration and
Processing Fees

a) Lesson Registration
b) Repair Paperwork Fee
c) Band Instrument
Processing Fee

Streams of Income
Warranty & Extended
Service Agreements
Replacement Plans Internal vs. External
Band Instrument or Rental
Threshold Discussion

Streams of Income

Freight Negotiations
Vendor Related
UPS FedEX
Music Freight

Streams of Income

In-Store Paid Events

Home Grown Events
Guitar Repair
Uke Classes
Home Recording

Streams of Income

Others
a) Lease Negotiations
b) Upgrade Items
c) Bin Items
d) Investment Income
e) Assorted Discounts
Printing, Check Guarantee, Office Supplies, CC, Airline

KPI Other Income

Track Results

Thank You!
a Defined Company Culture

George Hines - President Georges Music, Inc.

ghines@georgesmusic.com