3 Steps You Can Take in Your Stores to Improve your Monthly P&L Statement

If you were to hand one of your Store Managers your P&L Statement, they may be able to tell you if it is a good or bad.    For example, if beer sales are down in their store on the P&L, their answer may  be, “I need to sell more beer next month.”   To ask them what they can do to make its components improve they might suggest  changes to storefront signs, moving merchandise, or suggestions made at the register pointing out specials, etc. In fact, next month’s sales may improve.

However, this approach to P&L Management offers a discussion of whether improving next month is too late if there is way to improve it this month.  You look at the P&L to determine your profits, cash flow, determine weak areas. highlight strengths, and view how your C-Store business is doing overall.  You do this on a monthly basis.  You then try to capitalize on your strengths, look to improve your weaknesses and make strategic plans to make these things happen.  However, at the end of the day, it is the day to day activity that your stores execute that determine what is will be on that end of month statement.  If they can get P&L type data sent to them on a daily basis, then they have time to ensure a better P&L Statement for you at the end of the month.  They can take the steps needed to improve in areas where they are falling behind as the decline starts and turn things around.  Letting them know at the end of the month is costing you money because you will have a lag time for those improvements.

There are three ways to improve your P&L without ever having to train your staff on P&L analysis and Business Intelligence:

  1. By sending them daily notifications of areas that seem to be performing under where they should be for that day, alerts them to the problems in their store and what they need to focus on to improve.   Instead of waiting weeks for improvement, you begin to see things improve on a daily basis. Awareness of a problem is the first step of its solution.
  2. Put things in place that engage your Store Managers and their Supervisors  in  dialogue involving two way  feedback. There may be reasons for performance loss or perhaps they need more instruction and guidance.  Whatever you implement, make sure it is a process of taking action to correct the problem as soon as it is found.
  3. Compare performance before action was taken and after to see if steps taken to improve are working so you can change the course of action if they are not.  It may sometimes take many different attempts to resolve it.

C-Stores have many facets of their business.  They are no longer just fuel and grocery anymore. There is a lot more to monitor and track to ensure a store’s success in reaching its goals.  By automating awareness of P&L performance at each store on a daily basis you have a much better chance of improving the company P&L at the end of each month.

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The 4 Components of a Balanced C-Store Performance Scorecard

If you were to be asked to judge a picture when someone was standing in front of it at the time, you would probably say you could not make the call until you see the entire picture.  If given the option of a tricycle or a unicycle, most would opt for the stability of the three wheels. The same should be true when you are judging C-Store Performance.

It is common to measure revenue and let that information alone make the call on performance.  Success is rarely attributed to one thing in life. There are other areas to be monitored that will provide long term performance gain.  If you have been measuring by sales goals alone, hopefully, this will make you ask the question, “What defines a store as a good performer, if not revenue?” or even “What other areas should I be looking for performance results”

Wikipedia states that there are 4 parts to having a balanced scored Reference:
1. Financial
2. Customer Perception
3. Internal Business Processes
4. Learning and Growth

To see a holistic view of the company, these components must be included in the scorecard to monitor the critical parts of the business. Of course, having the management and process to use the scorecard is essential for success, but Robert S Kaplan and David P. Norton argue that a balanced scorecard provides better guidance for long term success in their article written in the Harvard Business Review. To apply this theory you only need goals and metrics. When looking at a balanced view of metrics, one will have a much better chance of seeing the cause and effects of areas that may be lacking. To apply this theory to a C-Store, here are a few examples of what could be measured:

Financial goals can include sales growth, sales totals, or sales comparisons to similar times throughout the year.

Components of Customer Perception to monitor might include customer satisfaction, cleanliness, friendliness, convenience and likeliness to return.

Internal Business Processes
Internal business process can be measured by how effective they are or how well are processes being followed.

Learning and Growth
Learning and growth can be measured by knowing you are offering new products or services, your awareness of new technologies in the C-Store Industry. It could be a measurement of how much of the measurement process is being shared with staff so they understand the day to day requirements of them. It might even measure the execution of safety or other required training in the industry. It comes down to what is being done to grow the business, the staff, and ones self for that matter.

When broken down Kaplan’s and Norton’s theory is a simple one. It applies common sense to Business Analytics. It is so much easier to establish and judge the big picture of how things are going when you are looking at all of the picture.

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