4 Metrics to Keep Track of in Wholesale

As a food and beverage brand, managing your wholesale operations efficiently is crucial for success. One key aspect of this is simplifying your reporting process. By focusing on the right metrics and implementing effective systems, you can gain valuable insights into your business performance and make informed decisions. We’ve outlined some ways you can streamline your wholesale reporting by focusing on essential elements such as sales velocity, inventory management, and financial metrics.

Key Elements to Track

1. Continuously Track Sales Velocity

Sales velocity is a crucial metric that measures how quickly your products are selling. To track this effectively:

• Monitor the number of units sold per SKU over specific time periods (e.g., weekly, monthly). Leveraging order automation solutions - instead of relying on manual solutions which are vulnerable to human error - will make it easier to track sales velocity
• Compare sales across different retail locations or regions.
• Analyze seasonal trends and their impact on sales velocity.

Pro Tip: Create a dashboard that visualizes sales velocity trends, allowing you to quickly identify top-performing products and potential issues, startups like Crisp make it super easy for you to create intuitive visualizations.

2. Enable Inventory Management

Effective inventory management is essential for maintaining optimal stock levels, preventing stockouts or overstock situations, and forecasting future needs. Key aspects to track include:

• Current inventory levels for each SKU - Rather than doing this manually, use barcode scanning or RFID technology to update inventory levels automatically
• Inventory turnover rate
• Safety stock levels - It’s always a good idea to set up alerts for low stock levels to trigger reordering processes

To simplify this process, consider implementing an inventory management system that integrates with your point of sale (POS) and warehouse management systems.

3. Calculate the COGs (Cost of Goods Sold)

Tracking your COGs is essential for understanding your profitability and pricing strategy. The basic COGs formula is:

• COGS = Starting Inventory + Purchases – Ending Inventory

It’s important to do regular inventory checks to properly calculate your COGS. If you’ve automated your inventory operations, this should be fairly simple.

4. Cash Flow Management

Maintaining a healthy cash flow is critical for any business. To simplify cash flow reporting pay attention to these areas:

• Cash-conversion cycle (from the moment the order comes in to the moment you get paid for it.) Look for ways that you can shorten the cycle. That may mean renegotiating your payment terms or finding ways to process your orders faster
• Calculate your DCOH (Days Cash on Hand)

Implementing a Simplified Reporting System

To bring all these elements together into a simplified reporting system:

1. Choose the right tools: Invest in an integrated software solution that can handle inventory management, sales tracking, and financial reporting.
2. Create customized dashboards: Design dashboards that display key metrics at a glance, allowing for quick decision-making.
3. Establish regular reporting schedules: Set up weekly, monthly, and quarterly reporting routines to ensure consistent monitoring of your business performance.
4. Train your team: Ensure that all relevant staff members understand how to use the reporting system and interpret the data.

By focusing on these key areas and implementing a streamlined reporting system, you can simplify your wholesale reporting process, gain valuable insights into your business performance, and make data-driven decisions to drive growth and profitability.

Remember, the goal is to create a reporting system that provides actionable insights without overwhelming you with unnecessary data. Regularly review and refine your reporting processes to ensure they continue to meet your business needs as you grow and evolve.