Companies set their business targets based on what they expect their consumers to purchase. file photo | nmg
Companies that set business goals are likely to experience increased sales growth, as they benefit from clear priorities, focused efforts, and greater energy in meeting their set targets.
Regional retailer Tuskys for instance, last year projected sales growth of 30 per cent over the festive season, following the launch of its Christmas Deals Poa campaign.
It surpassed the target, reporting significant sales growth in the general supermarket, as customers bought more fresh vegetables, bakery products and general household goods for the festive season. It also registered sales increases in the non-traditional categories that it focused on by offering special prices.
“In the footwear, electronics and furniture departments, we saw growth of up to 60 per cent. Our new range of furniture, particularly sofa sets and TV cabinets, dining tables and coffee tables offered at special prices proved quite popular,” said Tuskys CEO Dan Githua.
“Contemporary retail management requires that we forecast and respond appropriately to sales cycles on the supply chain back end and customer experience front end. The festive season gives way to the back-to-school season, which is also a very key calendar period for retailers. Also, due to the success of the Deals Poa campaign, we now intend to roll out such joint initiatives with our suppliers throughout the year.”
This kind of target setting, combining business projections with additional actions to deliver the aims, is essential for any company to competitively position itself in the marketplace.
Ultimately, such targets help a company to work on their areas of strength, while mitigating their areas of weakness, with this kind of concentrated focus allowing for the better and more efficient utilization of resources. It also underpins success in implementing initiatives by aligning a company’s internal planning and coordination towards the specified aim.
“Business projections are designed to complement the company’s strategy, what the leadership team is trying to achieve, and how they fund those initiatives. They help estimate attainable revenue goals, cost, and margins so the team can also estimate how much and how quickly they can fund important projects and be competitive,” said Karrie Sullivan, Interim CEO / COO / CRO of Culminate Strategy, LLC, an US-based management consulting firm.
Companies set their business targets based on what they expect their consumers to purchase, based on the season, special events, and current economic conditions.
An example of a retailer that surpassed its business projections by taking into consideration the financial status of its customers and of the country at the time is UK retailer Morrisons.
It reported last week a 2.8 per cent rise in sales in the 10 weeks to January 7, 2018, surpassing analysts’ prediction of growth of 1.7 per cent, with sales of its premium range up 25 per cent.
“Projections are a very important element of business management using the SMART goal setting model,” said Githua. “As the saying goes: What gets measured gets done.”
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