Retail unit margin
You sell one item off the shelf
Your profit is not on the shelf, it is in the turn. Gross margin times inventory turns - GMROI - decides whether a store makes money. Slow inventory is cash you cannot spend, sitting in a box, becoming a markdown. Attachment and basket size beat foot traffic in almost every situation you can control.
- Your ceiling
- Working capital tied up in inventory, and square feet of selling space.
- Biggest leak
- Reordering by gut — You reorder what you like and what sold last time you noticed. Run a sell-through report before every buy.