Overall, hardware stores excelled in 2013. According to North American Retail Hardware Association’s 2014 Cost of Doing Business Study, hardware stores reporting prior-year’s sales saw a 2.54 percent increase in same-store sales growth.
As defined in the study, hardware stores carry little or no lumber and building materials but do carry full lines of core home repair and maintenance products.
While the hardware store category performed well, high-profit hardware stores continued to be a step above the rest. High-profit hardware stores generated nearly $400,000 more in sales than typical stores and had an average profit margin of 7.4 percent compared to typical stores’ 2.9 percent. The high performance can be attributed to multiple factors, as seen below.
Applied to Retail: The Cost of Doing Business Study is the only inclusive industry benchmarking study and is a great way to compare your business against the industry average. While the study does not provide exact answers as to why your store is performing differently than the average, it offers information so you can analyze the areas of your business where those metrics can be improved. Realizing your store sells considerably less than a comparable store is only valuable information once you also understand the reasons behind that, such as a lower customer count or low performing employees.