Same-store sales

Same-store sales

Same-store sales is a business term which refers to the revenue generated a retail chain's existing outlets over a certain period of time (often a fiscal quarter or a particular shopping season), compared to an identical period in the past, usually in the previous year. By comparing sales data from existing outlets (that is, by excluding new outlets), the comparison is like-to-like, and avoids comparing data that are fundamentally incomparable.

Same-store sales are also known as comparable store sales or like-store sales.

Same-store sales are widely reported by publicly-owned retail chains as a key element of their operational results. For chains that are growing quickly by opening new outlets, same store sales figures allow analysts to differentiate between revenue growth that comes from new stores, and growth from improved operations at existing outlets.

By comparing how well existing outlets perform during a particular week compared to that same week in the previous year, business trends can be measured more accurately. Seasonal and geographical variations are removed from the measurement: instead of collecting an average over spans of time and location, annual changes in performance are revealed.

Specific store sales can also be compared. For example, a retail chain's finding that its same store sales at location A for the week-long shopping rush before Christmas are greater than those at location B is a useful piece of data. That data would have been less useful if only chain-wide sales for that week were known (with all stores averaged together), or if only year-long sales were known for that particular store.

References

External links

* [http://www.investopedia.com/terms/s/samestoresales.asp Investopedia]
* http://www.investopedia.com/articles/07/retailsalesdata.asp


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