ThreeBuckets.com Formula Sheet

  • Average Price = Dollar Sales/Unit Sales

  • Dollar Sales = Unit Sales * Avg. Price

  • Sales Increase % = (TY – LY)/LY

  • Initial Markup = (R – C)/R

  • Cost Complement = (1 – IMU)

  • Markdown % = MD $/Sales$

  • Maintained Markup = IMU – [MD(CC)]

  • Retail Turn = Annual Sales/Avg. Retail Inventory

  • Cost Turn = Cost of Goods Sold/Avg. Cost Inventory

  • Unit Turn = Unit Sales/Avg. Unit Inventory

  • Weeks of Supply = 52/Retail Turn

  • Weeks of Supply = On Hand Inventory at Retail/ Weekly Sales at Retail

  • Sell-Through = Units Sold/ (Units on Hand + Units Sold)

  • GMROII = Gross Profit/Cost Inventory

  • GMROII = (Turn/CC) * MM

**This is not a comprehensive list.  Just a few of the formulas we’ve received multiple requests for over the years.  If you have a request for a specific formula, please leave a comment or email me, and I will try to include it.

PRINTABLE VERSION AVAILABLE HERE

Can we really have a Cheat Sheet?

I’m asked this question a lot by students, and the answer is yes.   I also have faculty members asking me “Do you really give your students an Official Cheat Sheet for them to use on exams?”  The answer to that question is also yes.  But, this isn’t the way I used to do things.

Charles Halliburton, Senior Store Planner for Walmart Stores, Inc., is often a guest speaker in my Retail Strategy and Category Management classes.  He brings an invaluable industry viewpoint into the classroom, and has a gift for making retail finances understandable to anyone.  During one of Charles’ visits, a student asked him what his opinion was on allowing students to use “formula cheat sheets” for exams.  I was surprised when Charles told the students he was in favor of them, and that I should allow my class have one!  (It was a really good thing we were friends or he would have been in some serious trouble.)  Charles explained that in his opinion anyone could memorize formulas.  The hard part was understanding the relationships between the formulas, and when and how to use each one.  By the end of that class, he had me convinced.

I’ve included a version of that cheat sheet on this blog that is available here.  Feel free to use it if it is at all helpful to you.  Or, to make suggestions for formulas I should add to this sheet.  It isn’t a complete listing of all retail math equations.  I’ve pared it down to those that I have found most essential over the years.