why might companies focus on same store sales rather than total sales 556226

Industry Specific Ratios So called “same store sales” are a very important measure for companies as diverse as McDonald’s and Sears. As the name suggests, examining same store sales means comparing revenues from the same stores or restaurants at two different points in time. Why might companies focus on same store sales rather than total sales?

10. Industry Specific Ratios There are many ways of using standardized financial information beyond those discussed in this chapter. The usual goal is to put firms on an equal footing for comparison purposes. For example, for auto manufacturers, it is common to express sales, costs, and profits on a per car basis. For each of the following industries, give an example of an actual company and discuss one or more potentially useful means of standardizing financial information:

a. Public utilities

b. Large retailers

c. Airlines

d. On line services

e. Hospitals

f. College textbook publishers

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