Crunching the numbers
Carole Sloan, founding editor-in-chief -- Home Textiles Today, 7/23/2001 12:00:00 AM
There were very few surprises in our annual Retailing Giants Top 50 survey. Even the toppling of JCPenney from its eternal top spot didn't create much of a stir.
The numbers up and down the roster were interesting — but each needs to be analyzed from specific perspectives.
As an example, there's a whole cheering section pointing to Kohl's as the retailer to watch — and perhaps emulate. But keep in mind that Kohl's comps have been similar to rest of the market in recent days. It's their aggressive store-opening program that is the dazzler.
A while back, it was Dillard's that was going to be the retailer to survive whatever economic debacle that was unfolding at the time. 'Nuf said!
Store openings are a major way to examine the performance of a retailer, but there are other criteria that rank as high. One is the renewal of existing real estate, a function that often gets overlooked as companies become enamored of the prospect of more new stores.
In analyzing the financial reports of the Top 50's public companies, there was a strong clue as to which would be the most successful during trying times. They were the ones with significant capital resources allocated to renewal, as well as new stores.
It was the thing that began to grow on JCPenney's performance — no funds for renewal and no renewal program.
In this issue, we're looking at the Top 50 players via four different criteria. And while the rankings may seem obvious, it's critical to look beneath the obvious and analyze what these folks are doing.
As an example, Carson's tops the charts in terms of percent unit growth, by virtue of absorbing another Saks division. But even with this addition of 41 units, it ranked only sixth in percent sales growth, up 20.3 percent.
Similarly, there's a caveat in the net sales growth figures in terms of the types of retailers. Some have huge home textiles businesses where each new unit would add big dollars to the total. Others have added lots of stores but with smaller home textiles sales to total; but the result ratchets them up the ranks.
That list differs greatly with the top 10 percent sales growth leaders.
Dealing with numbers can be frustrating, fun, invigorating and very useful. But it's critical to understand what the statistics mean.
We would love your feedback!