Hardware Retailing The Industry's Source for Insights and Information
Have you ever overheard an employee saying something like: “Wow, we sold a lot today, the owner must be getting rich!” Or, “I didn’t mean to break those flower pots, but that’s alright as I’m sure no one will notice if we’re missing a couple.”
Unfortunately, the typical sales associate may have little understanding of the expenses it takes to operate a retail business and how easily they can eat into a store’s profits. The consequences of this can be serious. Employees who are careless with merchandise hurt profits. They might even think they can get away with stealing from you because you’ll never notice.
That’s the reason the North American Hardware and Paint Association (NHPA) created the “Our Three Pennies of Profit” video nearly 35 years ago. Since then, it’s been one of the association’s most popular training resources and thousands of sales associates have watched the simple story that explains retail profit and loss.
NHPA recently updated the video and has released the course in a new format to get students engaged and clear up any misunderstanding around this important topic. In the video, students learn how every dollar of sales must be divided up to pay for expenses such as payroll, rent, advertising and more. They next learn about price sensitivity, variable pricing and why simply raising prices isn’t the answer to earning more profit. Finally, the course shows employees that there are ways they can help their business hang on to their profits, whether it’s keeping a watch out for shoplifters or as simple as turning off lights in the break room when it’s not in use.
“Our Three Pennies of Profit” is ideal to use as part of the orientation process for new hires. It also makes a good refresher course to keep retail profitability top-of-mind for all employees. The course is available to NHPA Premier Members. If you are not a Premier Member but would like to learn more, go to YourNHPA.org/membership.
