The Executive Summery report helps you compare many inventory related metrics with peer stores and to Mango and Ace's targets.

Grey Highlighted Metrics
Metrics highlighted in grey are Key Performance Indicators.  These can be your primary area of focus and Mango has significant resources (through training or SKU-level reports) to help your store move the needle in these important areas.

Dot colors
There are four dot colors which can help highlight where your store is better than peers and/or meeting targets or areas of opportunity in your store. Sometimes a metric will not have color associated with its dot, this means there is not a above/below target associated with the metric.

Purple: metrics with purple exhibit an "out of bounds" condition where the metric is being excluded from peer averaging. This can occur Mango is picking up significant noise in the metric from your store.

Green: green means Great!  Your store has met the target and is in the top of its peer group.

Black: a black dot indicates a good metric or it can indicate an above/below peer group average if it is in column 1,3 or 4.  (see columns below).

Yellow: yellow indicates an opportunity to tweak a metric. it might mean a brush-up on training or might help place a little more priority to making the metric better. 

Red: red indicates a condition where your store is either way outside peer store or is not completing/processing Mango's reports.  Red is not always bad, it can mean your store has significant opportunity to be more profitable.

Columns
Columns 0 - 4 are similar to the dot colors and for metrics with colored dots, you will see the columns and colors match up.  For metrics without dot colors, these columns help you gauge if your store is above or below peer average.

Column 0: out of bounds, Column 1: above average, column 2: average, column 3: below average, column 4: significantly below average.

Note: sales and gross profit comparisons (to last year) are estimated for stores using Mango for less than a full calendar year.
These figures may differ slightly from your financial or other reports due to non SKU-level discounting such as terms discounts or using global discounts in the total window, which do not apply discounts back to individual SKUs.

MTD Sales - Month to date sales
Month-to-date sales measures sales increase/decrease from the same month last year.

YTD Sales - Year to date sales
Fiscal year to date sales increase/decrease from the comparable period last year.

YTD GP Dollars - Year to date gross profit dollars
Fiscal year to date gross profit increase/decrease from the comparable period last year.
Note for Eagle Stores: gross profit is calculated using the cost basis set up in your store (Option ID 102, Replacement Cost or Average Cost). An overwhelming majority of stores use Average Cost (like 99% of stores) so if your store is using Replacement Cost then your Gross Profit and Margin metrics may show lower than peers.

MTD Margin % - Month to date margin percentage
Average margin for the reported month (gross profit/sales) as a percentage.

YTD Margin % - Year to date margin percentage
Margin for your fiscal-to-date period (gross profit/sales) as a percentage.

Ace SKU Margin % - Margin percentage, Ace SKUs only
Year to date margin for Ace SKUs only.

Non-Ace SKU Sales % - Percentage of sales by non-Ace SKUs
Note: no dot color associated with this metric as targets for different types of stores are expected.
The contribution of non-Ace SKUs to total sales.  For example, a store with a sizable lumber yard may have a high percentage here as its non-Ace lumber sales contribute significantly to the store's overall sales. A store focused primarily on an Ace SKU assortment will have a lower percentage.

Non-Ace SKU Margin % - Margin percentage, non-Ace SKUs only
Note: no dot color associated with this metric as targets for different types of stores are expected.
Year to date margin for your non-Ace SKU population.

Rewards % - Ace Rewards redemption percentage
Note: no dot color associated with this metric as targets for different types of stores are expected.
The percentage of non-vendor/bankcard funded Ace reward redemptions to sales.  For example, if a store with $1 million in annual sales redeems $10,000 of rewards in the same period, its Rewards % metric will be ($10,000 / $1,000,000 * 100) = 1%.

Promotion activity % - Promotional sales impact
Note: no dot color associated with this metric as targets for different types of stores are expected.
Shows the impact of promotional sales activity in the store. A higher number can indicate a store more sensitive to promotional sales and may indicate a more price sensitive market. The metric is derived by summing the difference between full retail and actual selling price for promotional items, excluding Store Closeout = Y sales.  Your store's high dollar promotional impact SKUs can be found in your monthly Exception Reports under Top Promotional Sales and Discounts.

Margin Point Change LY
This powerful metric measures the difference between your store's current weighted back door margin (retail - replacement cost--based on historical sales) expected this year based on the same metric last year.  The metric excludes promotional and certain noisy inventory and the top drivers are reported in your Margin Impact Exception Report.  For example, a metric of -0.14 means your store's back door margin this year is 13 basis points below where it was last year (49.65% vs. 49.51% for example).  Negative values mean your retail pricing is not keeping up with inflation, or you have employed a price reduction strategy, whereas positive numbers indicate your margin this year is higher than last year (everything else being equal).

A step-by-step method to achieving inventory accuracy through controlled inventory operations

By utilizing Mango Report^® your store is employing a rigorous method to measure and achieve True Inventory Accuracy -- meaning a store's inventory as represented on its computer point-of-sale system is sufficient to account for financial performance, has quantity-on-hand accuracy sufficient to generate good orders, and is capable of detecting shrinkage caused by theft, all in a labor efficient way. Mango's focus on True Inventory Accuracy goes well beyond quantity-on-hand accuracy, which has been the primary focus of traditional accuracy methods such as cycle counting or annual physical inventories.

These key operational components are measured as your store utilizes Mango's Count Sheets and are reported on your Inventory Accuracy Scorecard (Review Email, Charts.pdf). Although it is possible to achieve each level independently, we suggest achieving each level sequentially (first Level 0, then Level 1, etc.).  Your Inventory Accuracy Scorecard will clearly show what level your store is working towards achieving.

Level 0: Completion -  a measure of your store's Count Sheet utilization.
Mango's Count Sheets must be processed (SKU's physically counted, 300-400 per month) to report and achieve your operational goals. This is "level zero" because all other operational levels depend on thorough Count Sheet processing.

Level 1: IRA - Inventory Record Accuracy or quantity-on-hand accuracy is a standard and important measure of how well your computer quantity-on-hands match physically when counted.  The measurement is obtained by processing your Count Sheets (Operational Level 0, above) where IRA is randomly sampled using the RC Count Type. If your IRA metric is showing "??" this means that your store's Count Sheet Completion metric has dropped below 95%.

Level 2: Dollar Accuracy - a measure of how close your physical ending inventory matches your computer inventory value (perpetual inventory value).
Perhaps the most important and easily obtainable metric is Dollar Accuracy.  Here we are looking beyond quantity-on-hand accuracy (IRA) and auditing for inventory errors, phantom inventory, and accidental non-inventory items.  Many times SKUs have errant costs or negative values which can dramatically impact how a store's financial performance is measured. Sometimes it's only a handful of SKUs creating all the financial havoc.

Level 3: Shrink - a measure of your store's inventory loss (at cost) divided by sales; loss due to theft and breakage.
Our favorite metric and maybe the best metric to consider as a staff incentive. Shrink wraps into one metric, many of your accuracy processes including counting accuracy, cashiering accuracy, loss prevention processes, back/top stock processes and shelf organization.  Operational Level 0, 1 and 2 are prerequisites to measuring a clean shrink metric and an understanding of how Mango treats Excluded and Adjusted shrinkage is crucial to getting this metric right. Stores passing this level will be able to tell if theft (internal or external) is unusually affecting business performance--successful implementation will significantly reduce shrinkage in most stores.

Level 4: Efficiency - a measure of labor directed to inefficient accuracy processes such as widespread counting.
We all know labor is limited, especially when it comes to inventory accuracy.  How and where we choose to deploy our accuracy labor can have a large effect on sustained accuracy. Massive counting labor directed at widespread counting tends to mask root accuracy leaks and overwhelms the research process with  trivial variance noise. No store can achieve sustained accuracy through counting alone. Instead, a focus on variance research, shelf maintenance, cashier testing and risk-based counting (Count Sheets and Shooting Outs) allows your inventory coordinator to root out accuracy leaks while discovering and correcting impactful variances.
 
Wrapping it up
Although Operational Levels are measuring separate categories, they are highly related to each other.  It is difficult for a store to achieve reasonable Dollar Accuracy if its IRA is poor and it is difficult for a store to improve its IRA if it devotes most of its accuracy labor to counting SKUs rather than variance research and cashier testing.  A few stores are already at advanced levels when they first come on to Mango, but the typical store has a lot of work to do (or undo).  It can be a difficult change for some stores with limited inventory control experience, or who rely heavily on counting.  We encourage goal-setting, patience, monitoring, and persistence. Accuracy and shrink control is a journey, please let us know if you have questions or get lost along the way.

Have fun! 

Mango's Inventory Productivity Levels will help tune your store's inventory engine by showing where to divest in unwanted inventory and where to invest in the good-selling stuff. A step-by-step approach keeps your store focused on achieving only one level at a time. First up is to reduce Unproductive inventory (stuff your customers don't want to buy and items you have too much of) to a reasonable level using Closeout Management, this frees up shelf space and cash. Next is to simply deepen inventory where customers are repeatedly buying you out (this is called In Stock), and finally, you can work on increasing your assortment breadth by bringing in new items that sell well in nearby stores. Highly actionable SKU-level lists for each level are provided in the Retail Analytics Dashboard (Acenet) so that hitting your target is easily within reach.

• Traditional inventory performance metrics such as Turns, GMROI, Inventory per sq. ft., Sales to Inventory Ratio, etc., are good at a high level, but they're hardly actionable at the SKU level. Take Turns for example, how do we make Turns better, and exactly what is better? None of the traditional ratios explicitly tell us if we have too much inventory or not enough (perhaps we have too much of the bad stuff and not nearly enough of the good stuff), we only know a ratio. However, if we look to the root components of inventory productivity then we can take SKU-level action by divesting in unproductive inventory and invest in more productive items. When we do this, Turns, Inventory per Square Foot, etc. are optimized along with your store's inventory investment!

Level 0: Unproductive  - Target 7% or less
This highly actionable level shows the dollar value (quantity on hand multiplied by average cost) of inventory that has not sold in over two years and with over two years of supply, divided by total inventory value.  SKU-level detail can be found in your MEGA Report (Obsolete and Overstock) tabs. Stores managing their unproductive inventory will see values 7% and below.  Stores with lower sales volume than the typical store will have their two-year sales threshold adjusted back (up to a year based upon sales volume). New stores will show 0% for two years.

Level 1: In Stock  - Target 1% or less 
In Stock Opportunity measures annual sales increase potential if your store never ran out of what it sells (Ace SKUs only).  For example, if your metric is 1.1% then your store would see an increase of 1.1% in annual sales if it never sold out of inventory.  This metric is highly actionable through the Retail Analytics Dashboard as it lists the SKU-level detail that makes up this metric.  Increasing inventory levels for these items will likely increase sales with very little inventory investment. SKU lists (and metric) excludes outs caused by RSC (retail support center), special orders, in/out promotional items and other kinds of noise. This is an easy level to achieve, but it takes some time for your In Stock percentage to move: persistence and patience are the key to this level. 

Level 2: Assortment  - Target 3% or less
Assortment Opportunity measures your store's incremental annual sales opportunity if it carried everything (Ace SKUs only) that sold well in other peer stores, but are not carried in your store.  SKU-level detail is found in a shopping cart on Acenet. This metric does not take similar SKUs into account (we're working on that) so it is unlikely your store would experience a full projected sales increase, however, this metric is consistently measured across all stores so it is a great at gauging how much additional sales opportunity your store has compared to targets and peers. We are constantly working on the quality of this metric by reducing similar SKUs and tuning the assortment to your market (Urban, Suburban, Rural, Lumber, etc.). 

Level 3: Certified
You've made it, congratulations! Your store's inventory is running at peak productivity. At this point, you've worked rigorously through all the levels and now you can shift into maintenance mode (using your PDF Exception Reports and Assortment Reports).

This section of the Executive Summary can help a store understand how its order points and resultant inventory level are achieving in-stock for your customers. 

Columns 1 through 4 are quantitative with 1 being above peer group average, 2 is average, 3 is below average and 4 indicates significantly below the peer average.  Colors are assigned qualitatively to indicate Green = Good, Black = Average or No Opinion, Yellow = Warning, Red = Extreme! 

OP greater than 1 - Order point greater than one percentage
This is a simple but informative metric showing the percentage of active Ace SKUs with order points greater than one as a percentage of all active (non-bulk) SKUs. If you want to see how your order point scheme compares to your peers then this is a great metric. Order point schemes with a high percentage of 1’s typically drive lower inventory levels and higher outs or are continuously overridden by staff during a manual ordering process.  

QOH greater than 1
This metric shows the percentage of active Ace SKUs in your store having a quantity on hand (QOH) greater than 1. This metric is highly correlated with your Productivity Level 1 - In Stock Opportunity and can be used to corroborate other metrics in two ways:

1. Compare/contrast with the OP greater than 1 metric above. large variances (20+ points) between QOH greater than 1 and OP greater than 1 can indicate a situation where order points in a store are not adequate and the staff is compensating by overriding the suggested order.
   
   
2. Compare/contrast to your Productivity Level 1 - In Stock Opportunity metric. Stores with more In Stock Opportunity generally have QOH = 1 on a large breadth of inventory (including some good selling SKUs) and therefore are perpetually short on stock.

Overstock
This metric shows the amount of inventory dollars (as a percentage of overall inventory) tied up in SKUs with over two years' supply on hand.  Store history combined with peer history is used to compute this metric and the SKU-level detail can be seen in your MEGA Report Overstock Tab. Overstock is part of your Productivity Level 0 - Unproductive metric.

COR Coverage
This metric shows the percentage of SKUs your store carries that are in Ace's Discovery COR assortment (fasteners excluded). It is a helpful metric to gauge how up to date your store's assortment is with Ace's category resets. Stores with lower percentages here have an opportunity to modernize their assortment which typically leads to better overall sales and margins.

GMROI TTM - Gross Margin Return on Inventory Investment, Trailing Twelve Months (TTM)
GMROI is a classic inventory productivity measure. It is calculated by dividing annual gross profit dollars by average annual inventory (Gross Profit dollars / Inventory Value). It is displayed as a decimal (instead of a percentage, as is typical with most other return on investment metrics). For example, if an item generates $30 in gross profit for the year and has an average inventory value of $10 then its GMROI would be ($30 / $10 = 3.00).  In the investment world, you would then multiply the 3.00 by 100 to get 300% return.

GMROI is a fantastic metric to use as a comparison between dissimilar classes of inventory. For example, liquid paint has a high inventory cost and low gross profit, whereas numbers, letters & signs may have much higher margin and lower inventory investment.  If we had $10,000 to invest in inventory GMROI would help us decide if liquid paint or numbers, letters & signs would be the better investment.

Relative Volume
This metric shows how busy your store is compared to the median (typical) store in your peer group. By comparing sales unit volume in the most commonly sold SKUs we can measure how much more or less of a typical SKU your store will sell compared to the median store (median store is 1.0).  For example, if your metric is 1.2 then your store sells 20% more units of commonly sold SKUs; if it shows 0.8 then your store sells 20% less. 

Relative Inventory
This metric shows how much more (or less) inventory value your store carries compared to peers.  For example, a store showing 1.2 carries 20% more inventory value than the typical store. 0.8 means 80% less than the typical peer store. This metric can be used in conjunction with other metrics (Productivity Level 1 - In Stock, QOH Greater than 1) to determine if your store is carrying enough of the right inventory.

Lead measures show how your store is impacting is Productivity Levels and are similar to Mango's Level 0 - Completion metric, which measures Count Sheet processing. However, instead of Count Sheet processing, these measures show your store is processing its Mango RAD metrics, and how well it's staying on top of shooting outs (which is a critical step to improving accuracy and in stock). 

The Fusion lead measures correspond to your Productivity Levels metrics, which are slow-moving and difficult to know if your store is actively worked to improve them last month.

• Your Shooting Outs metric gauges how thoroughly and frequently your store is shooting outs. Your metric shows the percentage of countable outs that were physically counted during the month. A SKU must be at zero on hand for 7 (or more) consecutive days to be included as "countable."  Assuming a store is shooting outs weekly then (in a perfect world) 100% of countable SKUs would receive a Last Physical Inventory date update. A listing of countable SKUs not counted is available online in your MEGA Report Shooting Outs tab.
  
  Your best practice is to shoot outs thoroughly each week.
  
  Targets: 
  0% - 14% - No regular shooting outs procedure.
  15% - 24% - Monthly or bi monthly shooting outs.
  25% - 34% - Almost weekly shooting outs.
  35% - 100% - Weekly and thorough shooting outs. 
• COM (Closeout Management) Fusion measures the percentage of closeout-eligible obsolete SKUs listed in the Retail Analytics Dashboard initiated into your closeout management MIP promo. If that didn't make any sense then consider employing Mango's Closeout Management system in your store! A high percentage measure means your store is actively using its COM grid to initiate obsolete inventory into Mango's Closeout Management system. Your COM Fusion metric helps you understand if your store is working on its Productivity Level 0 - Unproductive measure.
  
  Steps to improve COM Fusion
  
  1. Engage fully in Closeout Management.
  
  COM Fusion is the lead measure for Productivity Level 0 - Unproductive.

• OP Fusion measures how thoroughly your store is processing its In-Stock class of reports. It is a composite metric made from your store's In-Stock, Ace Min OP, and Max OP lists.  
  
  Steps to improve OP Fusion
  
  1. Monthly -> Increase Minimum Order Points using the Acenet Analytics Dashboard, or with your MEGA report.

  2. Annually->  Increase Ace Minimum Order Points with your MEGA report (Ace produces a new list each January).

  3. Annually ->  Process you Min/Max located in your MEGA report.

  ​

  OP Fusion is the lead measure for Productivity Level 1 - In Stock Opportunity.  That is, to impact your Productivity Level 1 metric, which takes several months to respond (a lag measure), you can process and monitor your Mango-recommended minimum and maximum order points: achieving a better OP Fusion will lead to a better Productivity Level 1 - In Stock Opportunity measure.  

• This line shows the makeup of your store's OP Fusion measure:

   

  Example: 93-88-65 = 93% In Stock acceptance, 88% Ace Min OP Acceptance, 65% Max Stock acceptance. 

  ​

  In Stock - (weighted 3x) shows the percentage of "In Stock SKUs" accepted as listed in your store's In Stock reports/RAD over the last three months. This percentage is weighted 3x in your OP Fusion metric as this specific measure significantly improves your Productivity Level 1 - In Stock Opportunity.

   

  Ace Min - shows the percentage of SKUs in your store whose minimum order points meet Ace's annually published Min OP listing.  Mango's percentage will be slightly higher than Ace's similar measure, since the Mango system does not recommend nor measure Min OP SKUs in your store with zero sales history in your store and peer group. 

   

  Max Stock - shows the percentage of SKUs in your store that meet Mango's suggested Max Stock recommendations. 

   

  Improving these metrics can be done through your MEGA Report In Stock tab.

This section of your Executive Summary report shows directly measurable effects of processing Mango's Count Sheets and Assortment Report PDFs in your store. 

Mango Recovered Sales
Shows the annual sales dollars sold (recovered) from your Count Sheets (primarily the MC Count Type). The MC Count Type lists SKUs showing quantity-on-hand but not selling like peer stores. When these SKUs are counted, zeroed out and reordered then subsequent sales (for a year) are tracked as "recoveries". Typical stores see around $15,000 in annual recoveries.

Mango Added Sales
Shows annual sales for SKUs added from your Mango Assortment Basket.  When SKUs listed on your Assortment tab are added, sales are tracked for one year.

Mango Shrink
Net Shrinkage dollars on SKUs listed in your store's Count Sheets. Mango's Count Sheets are very effective at discovering phantom inventory and high-shrink SKUs in your store. A typical store discovers 60% of their overall store shrinkage just by processing its Count Sheets.