Retail performance

Find below information about the « Retail Performance example in our demo solution.

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Distinct from other examples, this use case is designed for financial assessment using a business equation to analyze retail performance instead of a conversion funnel.

Our objective is to compare the net margin on a month-over-month basis. The net margin is calculated as follows:

Net Margin = Quantity x (Revenue/ Quantity) x (Net Revenue/ Revenue) x (Gross Margin/ Net Revenue) x (Net Margin/ Gross Margin)

Which will represent the analysis of the following ratio:

Net Margin = Number of Qty Sold x Average Price x (1-Discount Rate) x Gross profit Margin x Net Profit Margin

The equation allows us to dissect various factors affecting business performance, such as the volume of items sold, revenue generated from sales, as well as the discount, gross, and net margins earned. The equation can be further refined to incorporate other variables, like the number of distribution points selling the product, stock levels, costs, and more.

To gain a deeper understanding of Metric Relation, read our article.