Smallest stores
By Furniture Today Staff -- Furniture Today, September 11, 2005
&$2 million in annual sales
Efficiency measures
| Hours open per week | 51 |
| Gross margin percentage | 43% |
| Close ratio | 39% |
| Sales per sales employee | $400,000 |
| Sales per square foot of selling space | $101 |
| Return on sales | 4% |
| Return on assets | 6% |
| Return on net worth | 17% |
| Stock turns | 3.2 |
Space allocation
| Selling space | 74% |
| Warehouse | 20% |
| Administrative | 5% |
Non-store activities
| % of stores ... | |
|---|---|
| Offering in-home design consultations | 47% |
| With a Web site | 37% |
| Also selling through a catalog | 15% |
Sourcing
Direct importing
13% of retailers imported directly in 2004
11% of retailers who did not import directly in 2004 will in 2005, while 4% who imported in 2004 will not in 2005
Buying groups
7% of smallest stores belonged to a buying group in 2004
Another 9% are joining a buying group in 2005
Private label
6% of smallest stores offer private-label merchandise
| Revenue sources | |
|---|---|
| Merchandise sales | 96% |
| Finance/credit income | 3% |
| Income from services | 1% |
| Other income | &1% |
| Expense allocations | |
|---|---|
| Merchandise costs | 58% |
| Payroll | 20% |
| Occupancy costs | 11% |
| Advertising | 5% |
| Other | 6% |
Employees and payroll
A median of 21% of payroll goes to fringe benefits
| Full-time | Part-time | |
|---|---|---|
| Sick leave with pay | 56% | 26% |
| Vacation with pay | 88% | 40% |
| Health insurance | 59% | 6% |
| Dental insurance | 18% | 3% |
| Other insurance, life, disability, etc. | 14% | 9% |
| Retirement/pension plan | 23% | 11% |
| Merchandise discounts | 72% | 74% |
| Payroll costs by function | |
|---|---|
| % of payroll dollars spent on ... | |
| Sales | 45% |
| Warehouse, delivery | 25% |
| Repair/deluxing | 1% |
| Janitorial/maintenance | 1% |
| Other | 2% |
| Administrative, office | 27% |
| Full-time sales managers | Full-time sales associates | Part-time sales associates | |
|---|---|---|---|
| Hourly | 22% | 33% | 55% |
| Salary only | 49% | 29% | 11% |
| Salary plus commission | 32% | 39% | 26% |
| Commission only | 0% | 3% | 7% |
| Bonus for performance | 12% | 14% | 15% |
| Lowest | Highest | |
|---|---|---|
| Buyers | $17,680 | $31,000 |
| Store managers | $35,000 | $45,000 |
| Sales managers | $29,000 | $41,600 |
| Sales staff | $20,900 | $30,000 |
Advertising & promotions
| Allocating the ad budget | |
|---|---|
| % of ad dollars spent on ... | |
| Newspaper | 42% |
| Radio | 13% |
| Direct mail | 9% |
| Other | 20% |
| TV | 16% |
| Mark-downs are taken | |
|---|---|
| % of stores taking mark-downs | |
| Never | 10% |
| Annually | 7% |
| Twice a year | 32% |
| 3–6 times a year | 25% |
| More than 6 times a year | 9% |
| Maintain a clearance area all year | 17% |
| Median mark-down 20% | |
Source: Furniture/Today market research
Other includes national and regional magazines, Yellow Pages, sponsorships, in-store events
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