Loss Leader

What if we're measuring the wrong things?

Take the loss-leader of grocery retail - the turkey selling for $0.29 per pound, limit one, or even the CostCo rotisserie chicken for $4.99 or their hot dog deal - they're loss-leaders but these retailers still make money... a lot of money.

If we measure how many turkeys, chickens or hot dogs they sell, we'll miss the reason for selling at a loss.

Does the loss-leader drive traffic?

Increase the average sale total?

Improve good will and brand?

Last longer than the competition and squeeze their margins?

Train staff to serve customers by providing value?

They're all part of the loss-leader measures.

So, do you have a loss-leader in your organization?

You probably do... and may not be measuring it as well as you could measure it.

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