What is the real impact of Multi Sales?

What Retailer doesn’t love a Multi Sale!

Do you know the real power Multi Sales have on your margin?

The real Net Profit you make on the first item you sell would typically be under 10%, after paying for all expenses.

So if you sell an item for $150.00, your typical Net Profit would be under 10% or $15.00, that’s if you are doing extremely well! Most retailers would be more like 6% or around $8.00.

Let me explain by example:

If the 1^st Item is $150.00 less gst = $136.36
Less COGS, the Gross Profit would be around 55% or $75.00.
EXPENSES = discounts 10%, occupancy 15%, wages 12%, admin 5%, marketing 2% and other costs 5%, would be around 49% or $67.00.
NET PROFIT = $75.00 less $67.00 = $8.00.

Compare this to the 2^nd Item at the same RRP of $150.00 less gst = $136.36
Less COGS, the Gross Profit would be around 55% or $75.00.
EXPENSES = discounts 10%, occupancy 0%, wages 0%, admin 0%, marketing 0% and other costs 0%, would be around 10% or $13.60.
NET PROFIT = $75.00 less $13.60 = $61.40

You see you have already paid for all other expenses, (apart from any discounts), in the 1^st item, so the 2^nd item is where you make the real profit!

If you don’t have a focus on selling multi sales in your business, or measure what percent of your sales are multi sales, you are really missing out on some great profit opportunities!

This and other strategies that can positively impact, Sales, Profit and Cash Flow.

If you are interested in taking a deep dive into your retail business, simply shoot me an email merrill@merrillallen.com.au or give me a buzz on 0409 495 776 and we can arrange our Free Strategy Session.
Would love to talk about the opportunities your retail buisness!
Merrill
x