Tuesday, May 6, 2014

Where Is The 'Moolah'?

Ok. It's a very old British slang term for 'money.' But I had to find some sort of cheesy way to use a picture of Moulin Rouge as the illustration for a very dry post on margins.

Right. As y'all know, I've been concerned at the maybe dickey state of the finances within my very favorite co-op; the extent to which this has been caused by senior management's latest misguided foray into DIY capital projects (Carrboro Refit running over budget); the possible reaction (the give-it-all-away WOW weekend discount sales); or whether the latter are just a further example of the WSM corporate office management team's rather experimental approach to business finance.

Well. I want to give the management boys and girls every opportunity to explain. So. I have written (again - no time to rest) to our General Manager, to ask if we are going to see the monthly margin figures. I want to know just how much effect these wild WOW sales are having on our margins of profit. Whether it's all worth it. And if so, how?


"Hey Ruffin,

In the past few months, I have grown accumstomed to seeing posted on our Kitchen noticeboard the margin figures by department and store for the previous month. They seem to be posted at the beginning of each month. I was wondering when the margins for April were going to be posted? I'd like to see the effect of WOW on our margins.

Following the article in the 'Market Messenger' about WOW, the increase in sales in April and the average profit per WOW weekend of $183, I checked into the sales figures for last year. Last year, we were averaging about $600,000 a week in co-op sales. This year, something over $700,000, which is what you seemed to be getting so happy about on the front page of the 'MM.'

The inference was that the difference was due to WOW. But are we really saying that we are averaging $183 in profit on that extra $100,000 in sales? If not, what are we saying?

All the best,