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Patricia M. Johnson & Richard F. Outcalt
Retail Strategists and Retail Turnaround Experts
Co-Founders, The Retail Owners Institute® • Business Strata:G®
First question: "Does it move?" That's easy. Answer Yes or No.
The next question is key (and spoken like a true professional): "Should it?" Again, answer either Yes or No.
That incisive analysis then leads us to the appropriate choice among three potential remedies:
Duct tape, to stop it from moving.
Or , WD-40, t o get it moving.
Or , if neither remedy is required, a cold beer!
What an elegant (and entertaining) summation of a workflow. There is much to admire, actually. Its clarity, and ease of use. Just answer "Yes" or "No."
Appealing, isn't it? (Sounds like a great AI solution.)
Of course, business owners must make decisions beyond operational maintenance issues. Here’s an elegant process for clarifying issues that are more strategic.
For instance, how might three ingredients - milk, flour, eggs - be combined to make breakfast?
A Venn diagram is the tool for the job.
Here’s the key: It doesn't try to tell you what to cook.
Instead, it shows the outcomes of the different ways you could combine those ingredients.
Combine the flour ...with the milk ? Get batter .
Combine the egg ...with the flour ? Get pasta .
Combine the milk ...with the egg ? Get an omelette .
Combine all three ? Pancakes!
For a business owner, the maintenance flowchart may be very useful for fixing things that are broken. But when Owners must make more strategic decisions, or choose what opportunities to seize going forward, the insights and perspective quickly provided by a Venn diagram can be far more useful.
Food for thought…
Tips • Tactics • Strategic Insights • Commentary
FYI, each week's From The Co-Founders commentary is posted on The ROI site: Perspectives: The Co-Founders.
These short but pithy musings are all very quick reads. You know, retailer-friendly!
Available online, 24/7, free for all. ➡️
The fear of “What if...?” can keep you up at night. But what if those worries aren’t as bad as you think?
With The ROI’s 3-in-1 INTEGRATED Calculator, you can project different scenarios—testing even your most difficult assumptions—and see the numbers for yourself.
In minutes, you’ll know the potential impact on profit, and inventory, and most important - on cash flow. Get clarity and peace of mind when you need it most. Maybe things won’t be as bad as I feared.
The interactive "What if...?" feature makes it easy to compare options and make better decisions.
Every tweak you make updates the numbers instantly. It’s a powerful tool, replacing uncertainty with insight. Built specially for busy owners.
Have questions? Tap into the built-in tips or schedule a free Zoom session with the Co-Founders.
Economic uncertainty doesn’t have to mean sleepless nights. The 3-in-1 Calculator helps you take charge of your future, giving you clarity and peace of mind when it matters most.
The ROI’s 3-in-1 INTEGRATED Calculator is your go-to tool for staying proactive and in control. see more
👀 If you evaluate merchandise lines and vendors on sales volume or margins (or the relationship with the rep), this definitely is for you!
All retailers want to increase productivity – of their stores, their employees, their advertising, their technology, etcetera. Right?
But, how about increasing the productivity of your largest asset? You know, your inventory!
"How?" you ask.
By using GMROI to help guide your decisions.
The ROI regards GMROI - Gross Margin Return on Inventory Investment - as the #1 Inventory Productivity Tool in retailing.
To learn more about why and how to use GMROI in your retail operation, be sure to take advantage of this lively – and free – Webinar of the Week with Pat Johnson and Dick Outcalt, Co-Founders of The ROI.
GMROI – The #1 Measure of Inventory Productivity
The ROI’s Key Financial Benchmarks for 2021–2025 are here!
Yes, Pre-Tax Profit % and Gross Margin % are most everyone's first stop.
However – the Debt-to-Worth Ratio and Current Ratio are the most significant regarding your financial strength!
And Turnover and GMROI help to explain why the other four are what they are.
For perspective. Calculate these ratios for your own business, and then see how you compare to your retail industry segment.
Set your own target ratios for the next year.
Seeking a bank loan for your business? The bankers will look at these industry benchmarks as they assess your store's performance.
Go here to check out the ones for your retail segment. ➡️
RetailOwner.com
Avoid mistakes • Seize opportunities • Look ahead now
Latest Results Just Now Available!
The ROI’s Key Retail Benchmarks Charts are one of the most-used resources of The ROI. And for good reasons!
Presented visually, these compelling five year trend charts reveal how stores in 40+ retail verticals are trending on key financial indicators:
profitability
inventory productivity
financial strength.
Go here to see the latest results for your industry vertical.
As you compare your results to these industry results, you can quickly identify areas of strength as well as opportunities for improvement. (Or in other words, you can be your own consultant!)
Or, contact us and we’ll show you how to use the Benchmarks and improve your operation going forward.
As you ponder 2025 and look ahead to 2026, now’s the time to take advantage of this resource. We’re here to help.
And yes, The ROI continues to provide these unique and useful Benchmark Charts for free.
Yes, most everyone’s first stops are Pre-Tax Profit % and Gross Margin %.
However, Debt-to-Worth Ratio and Current Ratio are the most significant regarding your financial strength.
And here’s the key: Turnover and GMROI help to explain why those four are what they are.
Many people are first introduced to The ROI through the Retail Benchmarks pages.
But do you know? The ROI also has a Retail Benchmarks Resource Center, a one-of-a-kind resource for owners.
Nowhere else will you find such a clear explanation of what each of these ratios measure, how they are calculated, and most important, why they matter so much to Owners of retail operations.
Want to be empowered? Take advantage of the Benchmarks Resource Center!
Take 40 or so minutes to watch the lively, insightful webinar about the Indispensable Retail Owner's Dashboard.
Review why all this matters to Owners.
See how each key ratio is calculated.
Get your own master copy of the Owner’s Dashboard. Yes, it IS low-tech. (And that’s a feature, not a bug!) But is it ever high value!
There is an explanatory how-to article - "Go Figure! Calculate Key Ratios in 12 Seconds Flat!"
The "Key Ratios Cheat Sheet" is a quick reference to the formulas for each ratio, where to find the numbers, and what the calculations mean.
Then, once you know how to calculate your ratios with a pencil (“12 seconds each – max!”), use The ROI's KEY RATIOS Calculator to make quick work of it (and immediately compare your ratios to your vertical.)
All in all, the Benchmarks Resource Center is a very complete companion resource to the ever-popular Retail Benchmarks charts. All of its specialized resources are available free!
Let's say you're feeling better about your business. It's no longer losing money. Sales are inching upwards. You're ready to move past that "hunker down" mentality of recent years.
But, you discover that your vendors, or your bank, or your landlord do not share your enthusiasm! They say, "Glad your sales are better, but...." Or, "Our credit department is still reviewing it."
"What's with that?", you wonder. "How could they NOT want more business from me? I've been a darn good customer! Is there something they know that I don't know?"
Could be. And you won’t find the answer on your P&L.
Here's what your Balance Sheet is telling outsiders - in nanoseconds! - about your business:
Will you be able to pay your bills on time?
Is your business getting financially stronger, or weaker?
This lively Webinar of the Week, led by Pat Johnson and Dick Outcalt, Co-Founders of The Retail Owners Institute, will show how you can know that for yourself. In moments.
After all, your vendors and lenders already are doing this. Shouldn't you know what they know?!
The Retail Owners Institute® has been empowering owners since 1999 to "Turn on their financial headlights!" Our tools and resources are trusted by thousands of independent owners to help grow financially stronger and resilient businesses.