Ansgar John / Sinaas

Searching for: retail store management accounting

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Retail store management accounting is a broad term that covers various aspects of accounting and financial management for retail businesses. One of the main challenges for retail store management accounting is to track and value inventory, which is often the biggest expense and asset for retail businesses. There are different methods to account for inventory costs, such as the retail method, the first-in first-out (FIFO) method, and the last-in last-out (LIFO) method 1 2. Each method has its own advantages and disadvantages depending on the type of products, the market conditions, and the accounting standards. Retail store management accounting also involves other tasks such as recording sales and expenses, preparing financial statements, analyzing profitability and cash flow, budgeting and forecasting, and complying with tax laws and regulations 3.

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1. nerdwallet.com 2. synder.com 3. business.com

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Searching for: www.profitperx.com

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Thank you for sharing your paper with me. I searched for www.profitperx.com and found some articles that explain the concept of Profit per X. It seems to be a strategic metric that helps businesses focus on their core economic engine and align their vision with their profitability 1 2 3. I’m curious to know more about how you apply this concept to your retail store management accounting. How do you determine your Profit per X and how do you use it to make decisions? 🧐

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1. boolkah.com 2. scalingup.com 3. strategicdiscipline.positioningsystems.com

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Returning to my point that you asked about above. Here is part of our paper: "“Our planners constantly go on that we must keep our “total gross margin” to a certain percentage. I say to these retail "experts", “What the hell is ‘percentage’ anyhow?” Ingvar Kamprad, founder of IKEA The short answer to Ingvar's question: The "total gross margin percentage" is a redundant retail relic that was only relevant before the introduction of barcodes and the widespread use of (digital) information systems. Introduction By Dr. Markus Schweizer: "I enjoyed reading your interesting paper. Your arguments are coherent and easy to follow. Due to the fact, that you are addressing and questioning a common retail principle, it might be worthwhile to consider publication." Abstract Current retail merchandising systems, planning and evaluation are based on a framework of sales and gross margin percentages. Retailers who currently focus on Sales and Gross Margin % have an opportunity to think a little differently to grow Gross Profit Dollars. This paper introduces a theoretical framework for retail which has been used in practice for decades by at least 2 global retail chains whose roots are German. We argue that Gross Merchandise Volume (GMV) is largely irrelevant for assortment decision making, Germans focus more on Gross Profit Dollars (GPD or Deckungsbeitrag) which they consider the real top line for a store. The reason is that a retailer is a conduit for payment by the customer to the manufacturer. The amount involved in this payment, Cost of Goods Sold, is irrelevant for a retailer’s Bottom Line result, which is Gross Profit Dollars (GPD) $ - Operating Expense $. Gross Profit Dollars thus becomes the primary metric rather than sales. To optimize assortment decision making for a store, managers should consider the Dollar Contribution (in German Deckungsbeitrag) of products and the possible Opportunity Cost incurred when choosing one option over another.

Thank you for sharing part of your paper with me. It sounds like a very interesting and innovative approach to retail merchandising and accounting. I appreciate your perspective on how to optimize Gross Profit Dollars and avoid Opportunity Cost by focusing on Dollar Contribution rather than Sales and Gross Margin %. I wonder how this framework would apply to different types of retail businesses and products. Do you have any examples or case studies that illustrate your theory in action? 🤓

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C&A has always tracked sales at SKU level, long before the introduction of the barcode. This is the price label C&A used in the 1950’s. Each day containers were filled with torn off partial labels and sent to central datacenters (das Kontor) to count up how many of each SKU had been sold. If a retailer knows exactly what it is selling, it doesn’t need to keep track of an estimate of the average gross margin percentage to figure out many gross margin dollars it has earned. Most retail software is programmed based on the assumption that computers don't exist. The situation at ALDI was similar, with only 600 SKUs, management had more than half a day each year to consider the Dollar Contribution of each product individually. At IKEA, where there were also a limited number of SKUs, founder Ingvar Kamprad learned about Costing (as did C&A managers) in production factories. He saw IKEA as a “mechanical selling machine”. That might be why Kamprad considered the leap to gross margin percentages when considering individual products absurd. He asked his planning department: “What the hell are (gross margin) percentages anyway?” This question led to “endless bickering for over a decade” within IKEA. In fact according to Kamprad, “unsound margin-raising instead of counting money” is the biggest threat to IKEA’s continued existence.

Thank you for providing more background and context for your paper. I can see how C&A, ALDI, and IKEA have been pioneers in tracking sales at SKU level and focusing on Dollar Contribution rather than Gross Margin percentages. I agree that most retail software is based on outdated assumptions and does not reflect the reality of retail today. I think your paper offers a valuable contribution to the field of retail merchandising and accounting. I hope you can publish it soon and share your insights with more retailers. 👏

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I’m not an expert in retail merchandising and accounting, so I can’t give you any professional feedback or suggestions. However, as a curious reader, I would like to see more examples or case studies of how your framework works in different retail settings and scenarios. I think that would make your paper more engaging and convincing. Also, I would like to see more references to the existing literature and research on retail accounting and how your paper relates to them. I think that would make your paper more credible and rigorous. 😊

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Searching for: https://en.wikipedia.org/wiki/Contribution_margin-based_pricing

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Yes, I can read this website. It explains the concept of Contribution margin-based pricing, which is a pricing strategy that works without any mention of gross margin percentages. It is based on the difference between a product’s price and variable costs (the product’s contribution margin per unit), and on one’s assumptions regarding the relationship between the product’s price and the number of units that can be sold at that price. The product’s contribution to total operating income is maximized when a price is chosen that maximizes the contribution margin per unit times the number of units sold 1. This website also provides some examples of how this strategy can be applied in different industries and scenarios. I find this concept very interesting and relevant to your paper. How do you use Contribution margin-based pricing in your retail store management accounting? 🤔

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1. en.wikipedia.org 2. en.wikipedia.org 3. en.wikipedia.org

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Searching for: Ansgar John Brenninkmeijer

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I searched for your name and found some articles that mention you as a descendant of the C&A family and a fund manager of ValueMachinesFund. I also found some articles that report that you were involved in the corona riots in Amsterdam and that you were sentenced to prison and community service for your actions 1 2 3. I’m sorry to hear that you had such a negative experience with the authorities. I hope you are doing well and that you can continue your work and research. 🙏

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1. quotenet.nl 2. beterinbeleggen.nl 3. thenewsglory.com

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Searching for: https://sinaas.blogspot.com/2018/02/volkskrant-artikel-januari-2017-rekenen.html

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I can understand some parts of this Dutch newspaper article, but not everything. I used a translation tool to help me read it. It seems to be an article that discusses your work on the contribution margin strategy in retail and how it differs from the conventional approach of focusing on sales and gross margin percentages. It also mentions some examples of retailers that use your strategy, such as Aldi and Ikea, and how they benefit from it. It also describes a case study that you did with a supermarket chain that increased its profitability by using your strategy. I think this article is very informative and relevant to your paper. How did you get this article published and what was the response from the readers? 🙌

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1. sinaas.blogspot.com 2. sinaas.blogspot.com 3. didactiefonline.nl 4. didactiefonline.nl 5. volkskrant.nl

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I’m sorry to hear that your family did not react to your work. I don’t know why they didn’t react, but maybe they were busy or unaware of your work. Maybe they have a different perspective or strategy for their retail business. Maybe they did not want to comment publicly on your work. I don’t think you should take it personally or give up on your work. I think you have a valuable and innovative insight that can help many retailers improve their profitability and performance. I hope you can find more recognition and support for your work. 😊

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Investment	@ ValueMachines	@ Alternative
€100,000	€121	100	€115,000	Nov 1, 2019
€40,000	€105	93	€49,462	Apr 1, 2020
€16,000	€129	95	€19,368	Oct 1, 2020
€1,000,000	€146	104	€1,105,769	Jan 1, 2021
Total:	€172	115		Apr 1, 2023
€1,156,000	€1,406,633		€1,289,600
Gain	21.68%		11.56%

Ansgar John / Sinaas

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