University of Wisconsin - Center for Cooperatives


Cooperative Grocer, July/August 1997
Cooperative Grocer is published by Dave Gutknecht, P.O. Box 597, Athens, OH 45701

Retail Operations Survey Shows Co-op Growth, Challenges

By Scott Beers and Dave Gutknecht


Scott Beers is a consultant to co-ops through Cooperative Development Services. He has worked with co-ops since 1978, and advises them in the areas of accounting and finance (400 19th Ave. S., Minneapolis, MN55454; 612/338-7459; scott@lottsa.com). Dave Guthnecht edits and publishes Cooperative Grocer. Thanks to Jeanne Kruchowski for standardizing the responses and creating the database. Thanks also to NCB Development Corporation, which provides additional support for production of the Retail Operations Survey.

T he 1996 Retail Operations Survey reports double digit sales growth for the sixth consecutive year, along with a small increase in net income. The rate of growth climbed to nearly 14% in 1996, well above the 11% gain posted in 1995. Yet, once again, only three-fourths of respondents were profitable.

Co-op growth far outstrips the retail food industry in general, and it also compares well with the rate of single store growth in the natural foods segment. But co-ops lag behind the overall growth rate in natural foods, where many new stores are opening but few new co-ops.

Cooperative Grocer is pleased to present an updated set of performance measures for retail food cooperatives. Our survey covers many aspects of food retailing and also contains statistics and comments that are specific to co-ops. The survey population is predominantly "natural foods" co-ops, but a small minority do not define their market niche in this way. For comparison purposes we refer primarily to prior Cooperative Grocer surveys. For natural foods industry comparisons, we rely primarily on the annual Natural Foods Merchandiser survey.

Our figures are based on survey responses from retail coops from across the U.S. and Canada. Only sixty-nine (69) stores responded to this year's survey. While forty-seven (68%) of them were also part of last year's database, nearly half (43) of last year's participants did not respond this year. While we think that the data compiled this year is more reliable than ever, we hope that survey participation will increase next year. There are twenty-two new participants this year, and we welcome them.

The mix of participants changed significantly as well. Very small stores are a much greater segment of the survey population base. The sales thresholds for small, medium, and large stores are slightly different this year, in order to more accurately reflect the bunching of responses received (see chart below).

 
SURVEY CATEGORIES  
  SMALL: Annual Sales Under $750,000 
With a median sales / square foot / week of $4.12, these stores account for 25 percent of all responses.
  MEDIUM: Annual Sales From $750,000 to $2,000,000 
With a median sales / square foot / week of $13.07, these stores account for 28 percent of all responses.
  LARGE: Annual Sales Over $2,000,000 
With a median sales/ square foor / week of $13.45, these stores account for 48 percent of all responses.
 
 

Cooperative Diversity

Extreme diversity characterizes the food co-ops we surveyed. They report annual sales ranging from $42,000 to $25 million and net income ranging from a loss of ($200,000) to a surplus of $690,000. Employment levels range from 1 to 265. And 40% of the co-ops own the property in which their stores are located.

To make the survey report more useful to readers from such varied stores, and to home in on factors which may characterize profitable operations, we have:

We welcome comments and suggestions for future surveys.
 

Sales: More dollars but a shrinking share

The median co-op Sales Trend is growth of 9%, up one point from the 1995 results and down one point from 1994. A couple of very strong performers pull the mean up to 14%, which is three points higher than was registered in 1995. Sales declined in some stores and, allowing for 3% inflation, were flat or down in 15% of stores.

According to the June 1997 Natural Foods Merchandiser (NFM), industry (distributor) sales growth was 25%, while same store retail growth was estimated at 15-19%, varying widely by store type and size. Of our survey respondents, only 25% exceeded the co-op mean of 14%, and 9% met or exceeded the growth rate for the natural foods industry overall. The accompanying chart plots co-op vs. natural foods industry growth since 1991. As you can see, although co-op sales are growing, we are claiming fewer of the natural food dollars that consumers spend.

Among co-ops, the fastest growth occurred in large stores, where a few stores moved or expanded. Many of these failed to make a profit in their first year after expansion. Strong growth also was recorded in the smallest stores, while the mid-size stores are having the hardest time generating gains.

Expectations for 1997 are mixed. Nearly a third expect growth of 3% (inflation) or less, while one-third expect double digit sales growth. Only a handful of stores expect to meet or exceed the natural foods market's current growth rate of 25%. (See charts, above.)

For the most part, co-op growth is same store growth, while the natural foods industry is rapidly adding new outlets. Our growth per store is admirable; in many areas the co-op remains the market leader. But quite often the co-op's local market share is declining. Our inability to expand to take advantage of market opportunities is distressing.

As the natural foods retail chains establish themselves across the country, existing co-ops will be increasingly challenged and will face limits to expansion opportunities. How can co-ops grow and continue as leaders in a market they catalyzed? Retail development must be rooted in existing co-ops via consolidation, second stores, confederation, warehouse owned stores, or under a different model. The key point is that increased growth must happen or co-ops will find themselves further marginalized in a small but thriving segment of the food industry.
 

Later, in analyzing the BALANCE SHEET, we editorialize further on the need for co-ops to work together more. But first, a look at the INCOME STATEMENT.
 
Net Income 
Sources 
  • all stores
 
 
 ALL
Net operating income
-1.9%
0.8%
1.2%
0.3%
plus: Other revenue
2.6%
0.6%
0.4%
1.0%
less: Income taxes
-0.2%
-0.3%
-0.3%
-0.3%
less: Patronage refund
-0.3%
-0.0%
-0.1%
-0.1%
Net income
0.2%
1.1%
1.2%
0.9%
  • profitable stores
     
ALL
Net operating income
2.0%
1.5%
1.8%
1.8%
plus: Other revenue
1.3%
0.6%
0.5%
0.7%
less: Income taxes
-0.3%
-0.4%
-0.4%
-0.4%
less: Patronage refund
-0.5%
-0.0%
-0.1%
-0.2%
Net income
2.5%
1.7%
1.8%
1.9%
 

Gross Margins: Jumping UP again

The Gross Margin for all stores jumped three-quarters of a point to 32.5%. That's a cumulative increase of 3.4% during six consecutive years of increase. Yet in the same period, net income is virtually unchanged.

The greatest gains are seen in the large stores, where this year's participants report margins that are 1.6% higher than last year's. Mid-size stores jump 0.6%, while small stores report a drop of 0.6%, most likely because the size cut-off was lower.

Labor Expense: Key to profitability

Labor costs continue their persistent rise. For the sixth consecutive year they have increased, rising to 19.6% of sales over the entire survey population. As always, profitable stores have lower labor costs than do non-profitable stores.

The accompanying table illustrates the disturbing trend of escalation in gross margin, labor costs, and total expenses. Rising labor costs account for 80% of the increase in total expenses, so controlling them is crucial to ending this cycle. There is a real and proximate limit to the industry's ability to

continue raising margins to absorb increased labor expenses. Already natural foods are perceived as expensive, and as margins continue to rise there is an opening created for enterprising retailers to come into the market at the low end of the price scale.
 
Expenses & Gross Margin Trends
 
Gr. Margin %
Labor %
Total Exp. %
Net Income %
1991
29.1
17.2
29.2
0.7
1992
30.4
18.1
29.8
1.0
1993
31.0
18.3
30.9
0.7
1994
31.4
18.6
30.7
1.1
1995
31.7
19.0
31.3
0.9
1996
32.5
19.6
32.2
0.9
 

The Service Department Difference

As the table below shows, a service department has a tremendous impact on a store's financial statements. (Service departments are most often delis, and in a few instances include bakeries or cafes or juice bars.) They are high margin, high labor sections. They are also immensely popular and becoming more so, as evidenced by the greater growth enjoyed by stores with these departments than by those without them.
 
Service Departments: 
Labor, Gross 
Margin, and 
Sales Growth
 
 
 
Stores with Service Dept.
24%
32%
76%
Labor %
with Service Dept.
17.4%
21.0%
21.3%
w/o Service Dept.
17.0%
19.6%
18.4%
Gross Margin      
with Service Dept.
16%
9%
20%
w/o Service Dept.
11%
7%
12%
Growth Rate      
with Service Dept.
  16%
9% 
20% 
w/o Service Dept.
  11%
7% 
12% 
 

Physical Plant

Retailers spend a lot of money for their sites, so it is crucial that they get a lot from them. Physical Plant expenses are greater than 4% for co-op stores overall. As expected, small co-ops devote a greater share of their revenues to this area than do larger stores. Compared to the previous year, cost increases in this area exceed the rate of growth in sales.

Whether the co-op owns or leases has a lot of impact as well. A few respondents urged us to increase our report's relevance by providing information on the differences between stores that own their property and those that lease. The accompanying table shows the areas of greatest variance.

Many food co-ops, both today and in their earlier years, have invested heavily in real estate, often more than in inventory. Yet surely their primary business is moving goods, not holding property. Owning a site that proves to be too small or otherwise unsatisfactory can be a heavy anchor. Stores that own their sites have greater demands on their cash due to debt service. They are only half as profitable, and their Return on Assets (discussed below) is a meager 1.9%.
 
Owning vs. Leasing:  
Impact on Income Statement, Balance Sheet, and Ratios
 
Own site
40%
Rent site
60%
ALL
100%
INCOME STATEMENT:
Gross Margin
31.8%
33.0%
32.5%
Physical Plant
3.3
5.4
4.6
Interest Expense
0.9
0.3
0.5
Depreciation
1.3
1.0
1.1
Total Expenses
32.2
32.3
32.2
Net Income (median)
0.6
1.3
1.1
BALANCE SHEET:      
Current Assets
39%
58%
51%
Net Fixed Assets
54
31
40
Total Liabilities
48
41
44
Total Equity
52
59
56
RATIOS (medians):      
Sales Per Sq. Ft./Week
$13.07
$11.46
$12.12
Sales/Total Assets
$3.40
$5.81
$5.14
Sales/Net Fixed Assets
$6.22
$19.59
$13.87
Current Ratio
1.84
2.51
2.34
Debt to Equity
0.78
0.58
0.62
Return on Assets
1.90%
8.00%
4.50%

Discounts: Holding steady

In the composite Income Statement, Discounts are no longer presented as a reduction of gross profit, but rather as an expense line item. We are responding to a number of comments we have received, as well as making the format congruent with our thinking that discounts are a manageable expense. They are not a given, but a choice by the co-op: to what degree are discounts needed at the register, and to what degree is it prudent to withhold distribution of earnings until

the year-end figures reveal exactly how much is available? Since discounts compete for scarce gross profit dollars against labor, rent, marketing, and other expenses, it makes sense that they be presented with those expenses.

In addition, as in previous surveys, we are forced to lump labor discounts in with discounts given to all members. We recommend that co-ops make distinctions among their types of discounts and report each accordingly:

 
Discount 
Percent of Sales
 
 
 
ALL
  • all stores
       
UPPER QUARTILE
4.3%
4.5%
2.9%
3.4%
MEDIAN
1.4%
2.7%
1.2%
1.7%
LOWER QUARTILE
0.0%
1.5%
0.3%
0.5%
  • profitable stores
     
ALL
UPPER QUARTILE
3.8%
4.6%
2.8%
3.1%
MEDIAN
1.4%
2.6%
1.2%
1.6%
LOWER QUARTILE
0.0%
1.3%
0.0%
0.3%
 

There is very little change in the overall figures: co-ops continue to give back over 2% of each sales dollar in discounts. Once again, mid-size stores have the most costly discounts programs. Large stores give the lowest as a percent of sales, and profitable stores have a slightly lower range of discounts in each size category. But the quartile results show that a store can be profitable within a broad range of discount costs. Don't analyze this (or any) factor in isolation. If your co-op has relatively high discount costs, you must make this up somewhere. It also is important to determine whether your discount policy is achieving its desired results.

   

 
Profitability: Low, holding steady

The mean Net Income for all stores is the same as in 1995, a slim 0.9%. Net earnings percentages tend to increase as store size increases, although among just the profitable retails the strongest performers are the small stores. (Net income is detailed in the chart on page 20.) As noted earlier, only 75% of stores surveyed show a profit; in some cases, a loss can be attributed to that year's major expansion. Profitability, or lack thereof, often is disguised by Other Income. But like Income Taxes and Patronage Refund, Other Income should be seen as separate from the issue of whether store operations are self-sustaining.

 
Balance Sheets: It's time to join forces

Co-op balance sheets continue to be highly liquid, and a majority of them are very strong. They can afford substantially increased debt and use of capital for expansions, relocation, and equipment uppgrades. There are tremendous opportunities for investment in our cooperatives and in our market niche. Unfortunately there is little coordination of capital and talent on a national or regional basis in order to optimize these scarce resources.

As we have already pointed out, co-ops continue to lose market share overall. In local and regional markets, this may not be the case. But when individual co-ops do expand, it is typically a solo venture reliant on whatever resources that particular store has been able to squirrel away. Other possible stakeholders - co-op retailers, wholesalers, lenders, and developers - are supportive, but at too great a distance. It is time to somehow advance the consolidation of these co-ops so that our mutual resources can (a) more effectively support development and service delivery in the communities currently served by co-ops, and (b) enable co-ops to reach into markets not presently reached.

There must be a way that talented, creative, resourceful directors and managers can get beyond narrow self-interest in order to build organizations that truly embody cooperation among cooperatives. We applaud initiatives such as Northeast Cooperatives' management on contract program, a significant step toward retail-wholesale integration, and the new retailer-based national co-op information service. Failure to move forward in this direction condemns this generation of food co-ops to the same fate as the older generation of stores - a few isolated success stories (e.g., Hanover and Hyde Park), a smattering of small stores in widely dispersed areas, a distributor or two dependent on non-co-op customers, and little market clout or presence in national awareness.
 

Ratios

Ratios are a way of considering interrelationships in financial statements. They are used to uncover root strengths and weaknesses in the co-op's finances and to monitor them over time and against the industry.

The ratios presented here are the ones we consider most valuable overall for retail food co-ops. They are not exhaustive, nor are the results presented here necessarily good or bad. You must create a context for your analysis.

Take the time to compare your store to the appropriate figures for stores your size. Try to explain variances. Seek other opinions - it's amazing what a fresh viewpoint can bring out. Also look at your store's ratios in previous years. Set goals for improvement, and monitor the progress over time.

Overall, there were gains in Sales Per Square Foot Per Week. Given the costs of occupancy, this ratio is a crucial component for all store managers to closely monitor. Small stores are particularly vulnerable here, and can reap tremendous rewards by figuring out how to generate more sales in their generally underutilized space.
 
 
Sales Per 
Square Foot 
Per Week
 
 
 
CG 1996 median
$4.12
$13.07
$13.45
CG 1995 median
5.16
10.47
14.08
CG 1994 median
5.89
11.72
13.75
 

Labor productivity is measured by Sales Per Paid Labor Hour. This is pretty flat for co-ops. Productivity increases should be the source of improved compensation, but year after year pay rates and benefits expand while productivity stagnates. The result? Ever rising labor expense margins.
 
 
Sales Per 
Paid Labor 
Hour
 
 
 
CG 1996 median
$47.62
$48.18
$52.96
CG 1995 median
47.68
50.82
52.78
CG 1994 median
40.10
51.04
50.73
 

Inventory Turnover is crucial, yet it is highly variable, depending on the mix of products sold in the store. We suggest that each department have its own goal and that these be closely monitored. Co-ops tend to do pretty well here, although turn rates are declining. We also report Inventory Per Square Foot, which is useful in analyzing the appropriate inventory levels and mix for existing, new, or expanded stores.
 
 
Inventory 
Turns  
Per Year
 
 
 
CG 1996 median
7.1
9.8
13.9
CG 1995 median
8.5
11.6
15.1
CG 1994 median
8.0
12.5
15.1
 

The Asset Productivity and Current ratios are good examples of why you can't blindly rely on the statistics presented herein. If your co-op owns its property, your results will trail these. If you lease, you'll likely exceed them. Generally speaking, co-ops need to invest their cash in their operation in order to support greater sales levels.
 
 
Inventory 
Per Square 
Foot
 
 
 
CG 1996 median
$18.62
$47.14
$34.05
CG 1995 median
22.40
34.64
30.25
CG 1994 median
21.87
36.74
31.57
 

The Debt to Equity ratio continues to be strong for co-ops. Being debt averse as a rule, most co-ops will find there is ample room for them to obtain additional capital for well considered development projects.

Return Ratios measure the reward received for taking on risk. Consider a reset that will cost $50,000. What incremental increase in net profit will result? What other options do we have for use of the $50,000? What is the likelihood of success? Most co-ops are quite weak in these ratios. They don't generate surpluses commensurate with their asset or capital levels, or with the risks undertaken.
 
 
Return on Equity, 
Return on Assets 
(profitable stores, medians)
 
 
 
 
 
 
 
 
ALL
Return on Equity
5.4%
15.6%
15.8%
15.6%
Return on Assets
5.2%
12.5%
8.5%
8.8%
 

Wages, Salaries, Benefits

It is tricky to compare wages, salaries and benefits from year to year, since there is such a marked shift in the survey population. The table shows that managerial salaries are up 4%; that entry level wages climbed 5%; and that wages after one year have stagnated.
 
Manager Salary 
And Staff 
Wages
 
 
 
ALL
Manager salary (mean)
$17,662
$31,490
$40,393
$32,675
Change from 1995
-13%
7%
-3%
4%
Entry wage (median)
5.00
5.75
6.00
5.75
Change from 1995
0%
5%
4%
5%
Wage after 1 yr. (median)
6.00
6.60
7.00
6.50
Change from 1995
0%
2%
2%
0%
 

The benefit table is useful in considering whether your package is competitive, and what options for enhancement might be attractive. Once again we want to emphasize the need for greater labor productivity in co-ops.
 
Employee 
Benefits 
(percent of 
stores offering)
 
 
 
  ALL
Vacation
76
89
94
88
Employee discount
82
84
94
88
Sick leave
35
74
79
67
Employee health
12
68
91
65
Holiday
35
47
79
59
Dental/employee
0
21
61
35
Profit sharing
6
16
42
26
Disability
12
16
33
23
Education assistance
6
26
21
19
Other paid day
12
11
24
17
Pension
0
5
27
14
Deferred compensation
0
11
24
14
Salary reduction
0
11
21
13
Dental/family
0
5
24
13
 

Member Mission Measures

The cooperative mission can be described as member service based on member ownership. Our survey looks at several measures of member involvement that relate to this mission. We again see much room for improvement.

 
Percent of 
Sales to 
Members
 
 
 
  ALL
UPPER QUARTILE
96%
71%
80%
80%
MEDIAN
80%
50%
55%
53%
LOWER QUARTILE
50%
40%
45%
40%
 

Few co-ops sell exclusively to members. In a competitive market, non-member sales provide an important component and bring potential members to the co-opt But if the percent of sales to members is stable or declining, is the co-op effectively marketing the benefits of member ownership? The situation is compounded by the fact that some stores discount member purchases to such as degree that there is negligible or even negative net operating income on member sales.
 
 
Annual 
Sales Per 
Members
 
 
 
  ALL
UPPER QUARTILE
$1,721
$905
$1,126
$1,019
MEDIAN
781
659
899
842
LOWER QUARTILE
545
479
762
653
 

Members account for less than two-thirds of total sales in most co-ops; medium size stores again have the lowest figure with only half of their sales going to members.

Annual sales per member also indicate the service level to the co-op's owners. Nationally, shoppers spend nearly $30 per capita per week on food consumed at home, or about $1500 per year. Co-ops in the upper quartile approach or exceed this figure; one store averages over $2500 in sales per member per year. Those in the lower quartile are taking in less than $15 per week per member. Clearly this is an opportunity for improvement; quite often, capturing greater market share can begin with the co-op's existing members.

Member investment capital is an essential, though underrecognized, ingredient in cooperative success. Lifetime member investment among this year's survey population rises significantly in the upper quartile of stores, which have a lifetime investment level of $175 or more.

The investment that co-ops require of their members ranges from $5 to $500. That figure sometimes is supplemented by a member fee used to cover administration or other costs. Co-ops in our survey have annual fees ranging from $4 to $36; less common is the practice of lifetime fees, which range from $5 to $100. Member fees, whether annual or lifetime, often have the unfortunate effect of disguising weak net operating income through the addition of "Other Income." (See our earlier comments on profitability as well as the "Net Income" table, p. 20.) In addition, unlike invested capital, fees have the disadvantage of being taxable income to the co-op.
 
 
Lifetime 
Member 
Investment
 
 
 
  ALL
UPPER QUARTILE
$80
$205
$200
$175
MEDIAN
60
100
90
90
LOWER QUARTILE
20
80
75
60
 

Capital is needed by co-ops, or any grocery store, to allow for replacement of fixtures and to finance future improvements and growth. The principal capital sources are owner investment and earnings from operations. Although a significant portion of co-ops clearly are adjusting their member equity programs to reflect their store's need for capital, many investment levels appear to be arbitrarily low. But perhaps even more significant is the widespread practice of giving away most earnings through discounts instead of building the co-opt And in terms of the individual member, quite often the amount of discounts given has little rational relation to the level of investment required.
 

Board of Directors

While our survey focuses on store operations, we also ask a few questions about co-op governance and the board of directors. We hope the survey report helps board members as well as managers and staff to understand better the business of their co-opt It should be useful in evaluating the co-op's performance and in comparing it with other co-ops.

As in past years, most of the stores surveyed are consumer co-ops; approximately 30% are incorporated as non-profits, often because of unfavorable or nonexistent state statutes for consumer cooperatives; and a handful are worker-owned cooperatives. They all have member-elected board of directors, which range in size from 5 to 20 directors; the most common board sizes are seven and nine members. Director terms are two years in half the co-ops surveyed; three years for 40% of co-ops surveyed; and one year in the remaining 10%.

Having employee directors, unusual in private industry, is a common practice among co-ops. Two-thirds of surveyed coops have an employee on the board. Employee directors are elected by the members in 75% of respondents, by employees in 20%, and are appointed by the elected board in 5%.

Full board meetings are held 10-14 times annually in 80% of co-ops, while 13% meet less often and 6% more often. We continue to question the effectiveness and focus of co-op boards that are meeting 15 or more times annually. Are they micro-managing, lacking a context of defined responsibilities; or are they governing within agreed upon goals, developing policy, and working with store management to assure the coop's future?
 


Cooperative Grocer 1996 Retail Operations Survey
Statistical Summary of Income Statement, Balance Sheet, and Ratios
 
Sales under
$750,000
Sales of
$750,000 to $2,000,000
 
Sales of over
$2,000,000
All Responses
All
Profitable
All
Profitable
 
All
Profitable
All
Profitable
25%
17
16%
11
28%
19
20%
14%
Percent of All Responses
Number of Responses
48%
33
39%
27
100%
69
75%
52%
INCOME STATEMENT:
100.0%
100.0%
100.0%
100.0%
Gross Sales
100.0%
100.0%
100.0%
100.0%
29.4
29.6
33.2
32.9
Gross Margin
33.8
33.8
32.5
32.7
14.2
12.9
16.7
16.3
Wages & Salaries
16.2
15.9
15.9
15.4
1.5
1.3
1.6
1.6
Payroll Taxes
1.8
1.9
1.7
1.6
0.5
0.4
1.3
1.4
Employment Benefits
2.1
2.2
1.5
1.6
0.9
0.6
0.4
0.3
Other Labor
0.5
0.3
0.5
0.4
17.1
15.2
20.0
19.6
Total Labor Expense
20.6
20.3
19.6
19.0
6.2
5.7
4.2
3.9
Physical Plant
3.9
3.9
4.6
4.2
0.7
0.4
0.3
0.3
Interest Expense
0.7
0.5
0.5
0.4
2.4
2.0
3.0
3.0
Discounts
1.6
1.5
2.2
2.1
1.0
0.9
1.1
1.0
Advertising/Marketing
1.2
1.2
1.1
1.1
0.9
0.7
1.0
1.0
Depreciation
1.3
1.3
1.1
1.1
3.0
2.7
2.8
2.6
Admin., Governance & Other
3.3
3.3
3.1
3.0
31.3
27.6
32.4
31.4
Total Operating Expenses
32.6
32.0
32.2
30.9
-1.9
2.0
0.8
1.5
Net Operating Income / (Loss)
1.2
1.8
0.3
1.8
2.6
1.3
0.6
0.6
Add Other Revenue
0.4
0.5
1.0
0.7
-0.2
-0.3
-0.3
-0.4
Less Income Taxes
-0.3
-0.4
-0.3
-0.4
-0.3
-0.5
-0.0
-0.0
Less Patronage Refund
-0.1
-0.1
-0.1
-0.2
0.2%
2.5%
1.1%
1.7%
Net Income (Loss)
1.2%
1.8%
0.9%
1.9%
BALANCE SHEET:
14%
20%
23%
26%
Cash
17%
18%
18%
21%
39
45
34
33
Inventory
24
26
31
32
1
1
2
2
Accounting Receivable & Prepaids
3
3
2
2
54
66
59
61
Total Current Assets
44
47
51
55
34
22
30
29
Net Fixed Assets
49
45
40
36
12
12
11
10
Other Assets
7
8
9
9
100%
100%
100%
100%
Total Assets
100%
100%
100%
100%
16%
12%
21%
21%
Current Liabilties
25%
25%
22%
21%
28
21
10
11
Net Long Term Debt
26
21
22
19
44
33
31
32
Total Liabilities
51
46
44
40
27
26
38
36
Member Share Capital
31
33
32
32
21
30
26
29
Retained Earnings
17
20
20
25
8
11
5
3
Other Capital
1
1
4
3
56
67
69
68
Total Equity
49
54
56
60
100%
100%
100%
100%
Total Liabilties & Equity
100%
100%
100%
100%
 
 
RATIOS
17.6 19.0 12.7 14.7 Sales Trend: %
UQ*
13.5 12.0 14.0 13.0
12.0 9.0 8.4 12.6 (over previous year)
MED*
9.3 8.5 9.0 9.0
2.0 4.5 3.8 8.4  
LQ*
5.5 5.5 4.7 4.7
6.50 6.11 15.32 18.32 Sales per SQ FT per week: $
UQ*
21.40 21.18 15.32 16.26
4.12 3.04 13.07 13.89 (weekly sales / total paid labor)
MED*
13.45 13.45 12.12 12.72
2.71 2.71 9.14 11.26  
LQ*
11.89 12.12 7.00 7.89
53.35 61.50 58.00 58.00 Sales per Paid Labor Hour
UQ*
58.72 65.55 58.00 58.63
47.62 50.26 48.18 47.10 (total sales / total paid labor)
MED*
52.96 52.96 50.26 50.60
28.24 36.60 44.83 44.83  
LQ*
45.25 42.55 44.23 44.83
6.26 6.89 6.67 6.66 Sales to Total Assets: $
UQ*
6.93 6.93 6.66 6.89
3.38 3.63 5.43 5.43 (total sales / total assets)
MED*
5.15 5.36 5.14 5.30
2.43 2.92 4.39 3.31  
LQ*
3.50 3.73 3.33 3.50
71.60 75.12 29.55 37.49 Sales to Net Fixed Assets: 
UQ*
19.37 19.59 25.09 30.64
13.90 40.19 18.70 24.01 (sales/ [fixed assets less accum. Depreciation])
MED*
9.07 9.50 13.87 13.90
4.07 11.58 14.68 9.39  
LQ*
6.19 8.01 6.19 8.11
11.58 9.54 12.13 12.34 Inventory Turns per Year
UQ*
16.10 15.91 14.45 14.79
7.11 7.11 9.79 11.46 (cost of goods / average inventory)
MED*
13.85 13.73 12.04 12.13
6.34 6.34 9.32 9.32  
LQ*
12.73 12.73 9.32 9.58
24.30 24.59 4.58 5.71 Current Ratio
UQ*
2.40 2.40 4.30 5.70
3.67 8.51 3.09 3.67 (current assets / current liabilities)
MED*
1.59 1.69 2.34 2.38
1.49 4.07 2.17 2.11  
LQ*
1.15 1.30 1.28 1.54
0.10 0.04 0.17 0.17 Debt to Equity
UQ*
0.50 0.47 0.36 0.31
0.75 0.36 0.29 0.29 (total liabilities / total equity)
MED*
0.87 0.75 0.62 0.57
2.12 0.75 0.62 0.71  
LQ*
2.20 1.45 1.81 0.96
19.9 34.5 18.6 22.7 Return on Equity: %
UQ*
26.6 30.8 19.9 25.6
3.2 5.4 4.5 15.6 (net income / total asssets)
MED*
14.0 15.8 10.1 15.6
-4.6 4.6 0.6 4.2  
LQ*
2.3 11.7 0.6 5.2
16.2 21.8 13.0 15.0 Return on Assets: %
UQ*
13.5 14.0 13.5 14.6
2.0 5.2 3.1 12.5 (net income / total assets)
MED*
7.9 8.5 4.5 8.8
-3.4 2.6 0.4 1.9  
LQ*
1.4 6.2 0.4 3.1
33.3 34.1 35.8 35.1 Gross Margin: %
UQ*
36.5 36.6 35.1 35.8
31.6 30.5 33.1 33.1 ([sales less cost of goods] / sales)
MED*
34.2 34.6 33.2 33.7
26.6 28.0 31.9 31.1  
LQ*
33.0 33.0 31.1 31.1
4.3 3.8 4.5 4.6 Discount Expene: %
UQ*
2.9 2.8 3.4 3.1
1.4 1.4 2.7 2.6 (percent of total sales)
MED*
1.2 1.2 1.7 1.6
0.0 0.0 1.5 1.3  
LQ*
0.3 0.0 0.5 0.3
20.1 17.5 21.8 20.7 Total Labor Expense Margin: %
UQ*
22.5 21.7 21.7 21.6
17.5 16.3 20.3 20.3 (total paid labor / total sales)
MED*
20.8 20.6 20.1 20.1
15.2 15.2 19.3 18.1  
LQ*
19.9 19.9 18.1 17.5
3.2 3.6 2.6 2.8 Net Income Margin: %
UQ*
2.3 2.5 2.5 2.6
0.4 1.8 1.3 1.5 (percent of total sales)
MED*
1.3 1.4 1.1 1.5
-1.5 0.4 0.1 0.6  
LQ*
0.4 1.1 0.1 1.0
 
KEY: UQ* = Upper Quartile  MED* = Median  LQ* = Lower Quartile


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