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Are my sales really falling, and where?

Prepared by the Flawian team · Reviewed .

Compare this month with the same month last year, which removes the season, and with recent months, which show the direction. A young firm has only the recent months. Split sales by customer group. In the example, September is $4,000 below August, as last year. Against last September it is $2,000 up, and only new customers fell.

Principle and explanation

Sales can follow seasonal trends and cycles, so one month against the month before can mislead. The same month a year earlier removes the season, as long as prices and the offer stayed similar; the last three or six months show whether a recent fall continues. A total can hide opposite moves: one group can grow while another falls. Splitting the total shows which one to look into.

Worked example

Illustrative scenario. These are fictional inputs, not customer results.

A garden shop's September sales are $18,000, against $22,000 in August. Last year, August brought $20,000 and September $16,000.

A fictional garden shop's September sales by customer group, last year and this year
September last yearSeptember this yearChange
Regular customers$9,000$12,000+$3,000
New customers$7,000$6,000−$1,000
Total$16,000$18,000+$2,000

Last year sales also fell $4,000 from August to September, so this year's drop looks seasonal. Against last September, sales grew $2,000. Only sales to new customers fell, by $1,000, so that is where to look.

What this does not show

  • It shows where sales moved, not why: prices, marketing, a competitor or the weather can each explain a change.
  • A one-year comparison can mislead when last year itself was unusual.
  • It sets no growth target.

First step

Put this month's sales beside the same month last year and beside the last three months, split into two or three groups you can count. Mark the group that moved most.

Sources