Retail Industry Trends Snapshot: Retail Looks Rosy in 2011

Sageworks
June 17, 2011
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The weekly Industry Snapshot will highlight key metrics in a different industry each week. This week the Retail Trade industry is highlighted:

  • In Q1 and Q2 this year, the average retail store experienced sales growth of almost 5% and long A/P days, suggesting that these businesses are bringing in more business and managing cash more conservatively.
  • Average Net Profit Margins in the retail industry increased significantly; not only are retailers selling more in 2011, they are making substantially more profit off of each dollar.
  • COGS for privately-held retailers decreased during the first half of 2011.
  • The retail industry experienced substantial deleveraging as shown by the Debt to Equity ratio reduction. This could be due to companies using cash to pay debts or a hesitancy to take on debt.

Overall, Retail Trade experienced positive trends for Q1 and Q2 of 2011, namely increased sales and profits. Sageworks’ industry data also suggests that retailers are managing cash more tightly, despite growing profit margins. The Retail Trade industry is setting the stage for continued growth in the second half of the year, and Sageworks will be tracking it closely to see the emerging trends.

About the Author

Sageworks

Raleigh, N.C.-based Sageworks, a leading provider of lending, credit risk, and portfolio risk software that enables banks and credit unions to efficiently grow and improve the borrower experience, was founded in 1998. Using its platform, Sageworks analyzed over 11.5 million loans, aggregated the corresponding loan data, and created the largest real-time database of private-company financial information in the United States. The company was acquired in 2018 and is now part of Abrigo.

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