Strategic planning and efficient application is what leads to a successful business venture. It is mandatory that you know your Customers’ buying habits based on the product type and location. There are a lot of questions in a fresh retailer’s mind like how much inventory to maintain? What are the best selling and slow-selling products? etc. There is one and only answer to all these queries- Sales Trend Analysis.

Sales trend analysis is the review of your past selling records for a particular product at a given time. It makes you familiar with the usual behaviour of the customers and gives an idea of their preferences.

Data analysis can only be fruitful if the sales can be broken down into different groups. The analysis can be based on following criterias:

  • Sales by product – Determines whether the product is performing well or failing in the market
  • Sales by region – Different stored based in several areas can show diverse patterns for the same product according to the customers there
  • Sales by Customer – Large customers are targeted and their buying pattern is plotted and if there is a sudden change, the store-staff needs to clarify the issue

Benefits of using Sales Trend Analysis

Most of the retailers make Business related decisions based on their instinct. The difference between a top-notch and average retailer is the decision making. A data-driven approach is always successful in the long run.

Sales analysis highlights both the opportunities present as well as the sectors that need more attention. It is easy to determine what quantity to order for which product based on the customers’ response.

In the analysis the revenue generation along the time is also plotted and thus can help you figure out your growth-rate. Thus, analysis based decisions have a high probability of being a success.

What factors you need to analyze

  • Gross Revenue Trends
  • Owner’s earning trends
  • Gross Profits
  • Total Expenses
  • Year-wise financial records
  • Overheads
  • Trading hours

Year over year analysis is more advantageous than month to month comparison. Since it provides a bigger picture of the trends over the time. The concept of seasonal fluctuations is also out of the window so it provides a better insight. So, it is better to say that business grew 20% on an average over the past year, rather than saying that business grew 20% over the last month.

How to perform Sales Trend Analysis

First of all you need a centralized location to view all the data present. Even when your data is in multiple systems or through different sales channels, you should be able to view all of it from one location. This way even a small change anywhere impacts your whole business and is easy to point out. Excel or Integrated Software channel are the best platform for collecting your data from several channels.

Make a table in excel vertically or horizontally for any data type. Make two columns for entering data for two consecutive years. Add a new column ‘Change %’ and calculate as  [(this year-last year)/ last year]. Format the cells to %.

Now you can convert these changes to graphs and accordingly take follow-up actions.

Conclusions from your analysis

Now since you have all the results in front of you what is more important is what you make of it. Data may notify you about the changes but it is only you who knows why those changes took place in the first place.

So if the data shows growth or decline you now know which steps are benefitting you venture and which ones are holding you down. This is extremely necessary to ask those questions to yourself, then only the hard work behind the analysis pays off.

Trend change over the previous year shows about Customer behaviour as well. You need to keep their preferences in mind before taking the next step. Seasonal fluctuations also reveal themselves and you should be prepared beforehand for that.


To sum up, Sales Trend Analysis is a very miniature process but the results it provides are much more significant for your business. So you should give your ‘gut-feeling’ decisions a rest and try the trend analysis and see how it changes the whole scenario.

Using a good business tools like inventory management solution can help you understand your sales trends and optimize your sales.

Start preparing your business for 2018 now by signing up for a free account  of EMERGE App’s inventory management software.