Velocity calculation methods

Velocity Overview

Units per store per week (U/S/W) is a standard method for calculating retail velocity and is generally calculated as follows:

Crisp Velocity Calculation Methods

However, many brands choose to calculate velocity differently than the above method, depending on their business and products, so we allow you to choose the calculation you want to use on our distributor and brick and mortar retail velocity dashboards. That way, you can pick the method that best suits your business and easily compare velocity across data sources using the same calculation method.

To change the calculation type, from any velocity dashboard, select the Velocity Calculation Method drop-down menu and choose a method.

Note: The following calculation method options are only applicable to distributor and brick and mortar retail dashboards, not e-commerce dashboards like Shopify.

Crisp provides the following calculation options. You can select a link to jump straight to a detailed description and formula for each method.

• Exclude zero sales weeks and stores- This method is best when a product having zero sales does not not necessarily indicate poor performance, such as with seasonal products.
• Include zero sales weeks and stores with sales in period- This method is best when you want a conservative estimate of your velocity and are looking at velocity over a longer time period.
• Lookback period- For the include zero sales week calculation method, you can also use the Weeks Lookback for Stores with Sales filter to include a lookback period in the velocity calculation. This is best when you want a conservative estimate of velocity over short time periods or for slow moving products. 

Note: Crisp does not use authorized store lists to calculate velocity in any of our calculation methods because very few data sources provide Crisp access to authorized store lists. So, rather than use authorized store lists in the calculation for one data source and different calculation inputs for others, we make the velocity calculations uniform across dashboards to provide a consistent experience and make it easier to perform like to like velocity comparisons between different dashboards.

Exclude zero sales weeks and stores

Description: This method is calculated by excluding store/week combinations that did not have a sale. This includes authorized stores that did not have a recorded sale because Crisp has no record of authorized stores for most data sources.

When to use: We recommend using this calculation when you expect to see long time frames without sales but those long breaks do not necessarily suggest a poor-performing product. Examples include looking at seasonal items or at our distributor dashboards, where shipments typically occur at an irregular cadence.

Formula:

Note: We use store/week combinations in this calculation rather than distinct store and week counts to ensure we only include instances that had a sale. For example, if a particular store had one sale over a 52-week period and we used distinct store and week counts, then that store would be weighted the same as other stores and could greatly bring down velocity values. Using store/week combinations allows us to normalize for these types of situations.

Example:

Let's say you have the sales shown in the following table:

From this data, we get the following values to use in the velocity calculation: 

• Sales quantity: 33
• Store/week combinations with sales: 4

Using this method, Crisp calculates the total velocity for the period 10/3-10/17 as follows:

Include zero sales weeks and stores for selected period

Description: This method calculates units per store per week by including all weeks for any store that shows up in the selected time frame at least once. This means that when the data source records zero sales instances, we include these records. If instances of zero sales weeks are missing from the source data (such as with distributors like UNFI and KeHE), we fill in these records with zero sales.

Stores which had sales just before or just after the selected timeframe will not be included in the calculation, so when using this method it is important to select your timeframe carefully, as excluding stores has the potential to inflate your velocity (especially when looking at shorter timeframes).

When to use:

Because this method includes weeks with zero sales, it is a great way to see a conservative view of your velocity. This method will typically show a lower velocity compared to when you choose to exclude zero sales weeks. This method also works well when you are analyzing velocity over a longer period of time or periods when you know all of your authorized stores have had at least one sale. If this method is viewed over shorter timeframes, stores that had no sale (including authorized stores) can be excluded, increasing velocity. If your products are slow moving or recently launched, we do not recommend this method.

Formula:

Example:

Let's say you have the sales shown in the following table:

From this data, we get the following values to use in the velocity calculation: 

• Sales quantity: 33
• Distinct stores from the selected period: 2
• Distinct weeks from the selected period: 3

Using this method, Crisp calculates the total velocity for the period 10/3-10/17 as follows:

Include zero sales weeks and stores with lookback

When you add a lookback period, the units per store are calculated by including all weeks for any store that shows up in the selected time frame or the lookback period at least once. This means that when the data source records zero sales instances, we include these records. If instances of zero sales weeks are missing from the source data (such as with distributors like UNFI and KeHE), we fill in these records with zero sales. 

Using a lookback period incorporates data from a prior timeframe (the lookback period), allowing you to include stores that have not sold during your selected time frame but that you still want included your velocity calculation. These are typically stores that are authorized but happen to not have a sale in the selected time frame. Note that this increases the store count but keeps the number of weeks the same.

To add a lookback period:

1. From the filters section on a velocity dashboard, select the More button.
2. From the Weeks Lookback for Stores with Sales drop-down menu, select a lookback period.
   

Note: If you select a lookback period, the velocity values on the line charts include the store count from the period prior to the selected time frame (the length of that prior period will be equal to the lookback period you selected.) For example, if you are looking at the velocity for the week of October 3rd and using a 2-week lookback period, stores that had a sale in the two weeks prior to October 3rd are included in the velocity calculation for the week of October 3rd.

When to use: Using a lookback period is best for when you want a conservative view of velocity, but you are looking at shorter time frames and slower moving products. You can experiment with the lookback period duration until you see the expected store count. 

Formula: 

Example:

Let's say you have the sales shown in the following table for the selected period of 10/3-10/17 with a two-week lookback period:

From this data, we get the following values to use in the velocity calculation: 

• Sales Quantity: 33
• Distinct stores from the selected and lookback period: 3
• Distinct weeks from the selected period: 3

Using this method, Crisp calculates the total velocity for the period 10/3-10/17 as follows: