Metrics To Measure Your Product Performance

May 4, 2022

Sold Quantity

Count how many of the specific products have been sold! This can be measured daily, weekly, monthly or yearly, it’s your call.

Selling Speed

Sold quantity divided by the selling days

You should know how fast a product is being sold? Remember, it shouldn't be considered a “bestseller” if it takes a long time to shift from the store.

Sell-through Rate

Sold quantity divided by the quantity intake

This math account measures the quantity of a product a retailer receives from a manufacturer or supplier compared to what is then sold to customers, it is a very important measure to be aware of.

Gross Margin

Selling price minus cost of good divided by the selling price times 100%

Understand that the gross margin indicates the earning ability of an item. The higher the percentage, the more the company retains on each dollar of sales, ok? If the value is low, you may need to consider raising the selling price or, depending on your business model, lowering the cost of goods. The selling price will be the wholesale price and the retail price, when measuring the wholesale and retail performance respectively.

Return On Investment

Selling price minus cost of good divided by the cost of good x 100%

It’s a bit obvious xD Return on investment (ROI) represents the financial benefit received from an investment. The goal is to have a high ROI, of course, which is indicative of your investment leading to gains, YAY.  It is useful to compare the profitability of different products!

Return Rate

Number of return divided by the sold quantity x 100%

Be aware that to truly measure products performance, you need to take the return rate into account. You may sell a product in high quantities but the product may have a high return rate :(  which does not equal profit.

Using all these metrics you will be able to g
row your business strategically, we are all passionate about the creative part of the fashion business, but it is also necessary to have a great administration to reach success.

Source: Fashion Business Manual by Fashionary

Key words: fashion business, retail, wholesale, entrepreneur, b2B, textile manufacturing, business management, investment, margin, rate.

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