| |
|
|
Are You Facing Sarbanes-Oxley Write-Downs?
Before the enactment of Sarbanes-Oxley, if you had an underperforming store, the assets of that store could
remain in their normal depreciation cycles in hopes of improving results. However now, under Sarbanes-Oxley, those assets have to be written down to the value of the current performance level if the store does not have a reasonable likelihood of improving. This truthful, up-to-date valuation of your company's assets is now required by law, and must be available to the public- stockholders, competitors, customers -which is bad news if you have under-performing stores.
Overcoming the Sarbanes-Oxley Blues
Before you take the write-down, it would be wise to take a look at the buying habits of the people living in the trade area of the store. With the abundance of consumer data available today and predictive modeling technology, a retailer can immediately know the number of their target customers who live in that trade area. If the assessment shows that you should have a winning location, then instead of the write-down, focus on fixing the real problem, which may be management, merchandise mix, inventory position
or advertising.
It's possible the assessment will show that the store does not have the potential to improve. In which case, it's best to take the write-down, and begin looking for a way to choose better locations in the future. Successful companies today know that site selection is more science and less art - sales at potential sites can be forecasted well before you commit to the site. With new onlinetechnologies, such as SCOUT, you don't even have to leave your computer to visit each potential site to analyze variables and decide if it
meets your guidelines for a successful new store.
|
| |
|
|
SCOUT Online Site Management Helps to Select Winning Locations 
