How to set the perfect KPI in retail for a brick-and-mortar store? Steven P August 15, 2022
How to set the perfect KPI in retail for a brick-and-mortar store?

In order for the sales business to be convenient and effective, it is necessary to have indicators to evaluate. This helps you have a more objective view of the current state of the business, avoiding the situation of putting personal thoughts and judgments into work. Then you will have the most accurate data to adjust your business strategy accordingly. Retail KPIs are metrics that help improve sales. In this article, we want to provide information to help set the perfect KPI in retail for a brick-and-mortar store.

What are KPIs in retail?

KPI (Key Performance Indicator) in retail is an extremely important indicator that is often used to measure work performance. Based on the KPI set from the beginning, you can track the completion of the work of an individual or an entire team or business. These are the numbers that a brick-and-mortar store must regularly monitor to be able to determine if its business is on the right track.

With specific targets and requirements, KPI plays the role of a tool to evaluate the completion and effectiveness of the work. From there, find the work that has not been done well to have a suitable improvement plan. These are not fixed indicators, KPI in retail varies from area to area. Therefore, based on the goals of each business at each stage of development, there are separate KPIs. 

How to use retail KPIs

How to set the perfect KPI in retail for a brick-and-mortar store?

In general, KPIs in retail are used to gauge whether or not you are meeting your goals. They help stores see, evaluate, and take specific actions to improve their business. And depending on what factors you choose to measure, KPIs help you see where your store is in terms of sales, inventory moves, growth, customer satisfaction, and more.

Set the perfect KPI in retail for a brick-and-mortar store

Sales per square foot

Sales per square foot mean the number of sales you generate per square foot of sales space in your store. Sales per square foot must be measured as this is a good indicator of a store’s productivity, and it can also indicate whether a store is making good use of its space and furnishings. This retail KPI also helps the store plan its store layout and merchandise.

You can also compare your store with other stores and tailor your sales and retail productivity strategies by improving the store layout; having one type of focus product; price optimization or promotion; encourage customers to stay in your store longer.

Sales per employee

How to set the perfect KPI in retail for a brick-and-mortar store?

Sales per employee is a useful metric when you plan your employee schedules and initiatives. This metric can help brick and mortar stores make smarter hiring decisions.

To improve sales per employee, stores need to rely on associates that generate more sales. They can set smart sales goals for each employee, invest in sales training, motivate their employees to perform better or give employees tools (like a good CRM) to make it easier to generate sales.

Conversion rate

Conversion rate is the ratio of store visits to the number of shoppers who made a purchase. The conversion rate tells the store how many viewers turn into buyers and offers the right tactics. To increase conversion rates, stores can build relationships with customers through loyalty programs.

Gross and net profit

How to set the perfect KPI in retail for a brick-and-mortar store?

Gross profit represents the store’s revenue after deducting the costs of creating and selling the product. Tracking this KPI in retail will help you make smarter decisions in different aspects of your business. For example, if your gross margins are low, then you may want to look into sourcing your products and determine if there’s a way to lower your COGS.

Online sales relative to brick-and-mortar locations

Selling online versus brick and mortar stores is a new metric that benefits omnichannel retailers. To measure it, a store needs to look at e-commerce analytics and see how much traffic or revenue is generated from locations where the store has a physical presence.

Consumers today are increasingly using multiple channels to shop, so you need to know how your physical presence affects your eCommerce sales.


Setting the perfect KPI in retail for a brick-and-mortar store is not an easy process and requires a lot of attention from stores. Contact us for help optimizing your in-store retail business.

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