Originally posted by foo ling yu
So we're back at number 1 again in Oz & NZ.
Not overly exciting because we had predicted that anyway, this is the first sub renewal of the Xmas day mass connections.
The good news is the continued upward trend, notice how many days we were at #4 position prior to the Dec (Xmas) spike and how many prior to this spike. (2 - 6)
And the days below #7 are 11 - 5 respectively.
The top overall rank is also higher than it was Xmas day.
We know that 25% of apps account for 50% of revenues so even small steps in rank at these levels indicate strong revenue growth.
We also know that these ranks are only guaged against other apps performance, so 1bad day for another could give us a leg up in rank with no revenue benifits on our part..... But..... As we are categorised with mapping, navigation, boating and the like it's only fair to assume that this period has been the peak of their activity also.
Very happy with this so far.
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Thanks for posting. I'm sure you are more familiar with what you posted than I am so please correct or confirm what I conclude from the chart;
I would think it's fair to say that most of the higher ranked apps are experiencing good growth (simply because they are the higher ranked apps), so the conclusion that we can draw from the up trend in our ranking is that our growth is stronger than the average growth of other high ranking apps? It might in fact be the case that we have the highest rate of growth of all apps even though that can't be certain from this chart?
By the way, I've started checking availability again in JB stores and according to the click and collect on JB's website, some stores are already back down to zero on some colours and Mile End in SA which was a strong performer in Nov/Dec is back at zero on all colours. Did anyone check Mile End stock using this method just after they re-stocked a couple of weeks ago? If so how many were showing?
It appears JB will need to re-order yet again before long? They might allow some of the other stores to get closer to zero stock again before re-ordering as they did in December? I hope not as this must piss customers off that expect stock to be available in their local store. I guess inventory control on a national level must be more important to JB than inventory control on a single store basis. Perhaps they could shift stock between stores but that's up to JB, not us. At least it indicates sales may be quite good still post Christmas.
The store with most stock of those I monitor is Melbourne Central with 10 grey, 4 pink and blue and 2 red (20 watches). I still believe this method of monitoring is only good as a rough guide but if Mile End had 20 watches two weeks ago and has none now then that indicates very strong sales for just one store. The discounted price might be very effective this month. Sure it means a lower profit margin per watch but if your sales volumes are double what they would otherwise have been, then total gross profit can be higher. Example below;
My estimation is that gross profit per watch through retailers is around $140 from all the available data I have looked at. The company will never disclose that for obvious reasons but we'll get some idea after the annual report is released. Before anyone argues $140 per watch sounds too high; I am talking gross profit which is the profit margin before staff costs, overheads, advertising etc.
For the following example, if it is $140 per watch, then for every 1,000 watches sold, gross profit is $140,000. If MGM offers JB a $40 rebate for the sale period, for every 1,000 watches sold, gross profit is $100,000. If they sell twice as many at the reduced price then gross profit for MGM jumps from $140,000 up to $200,000 despite the lower selling price. Whether JB gets as much as a $40 rebate or something less and they absorb more than just $9 of the discount (as I have assumed) is anyone's guess. Staff costs, overheads and advertising costs are fixed costs so a $200,000 gross profit on 2,000 watches will leave you with $60,000 higher net profit before tax than you would have made without discounting the watch and selling 1,000 watches at $349 instead (based on the assumptions used in this example). This is a little simplistic as I did not allow for the 10% GST but the overall result for MGM would better because a $50 discount for the customer is only a $45 reduction in the sale price for the retailer (so less rebate needs to be offered by MGM). The tax office shares some of the discounting and loses $5 per watch.
We should remember this going forward as well. If we reduce our price longer term (say sub $300), annual sales volumes would increase significantly over what they would have been at a selling price of $349. Many more people might be able to buy the watch at sub $300 than at $349. Increased sales volumes will also mean decreased manufacturing costs so a reduced selling price might be a win-win especially if the margin is decent enough to begin with. I'm confident that it is based on my research and the rapid increase of cash on hand post Christmas despite only selling half the recently purchased stock, confirms that IMO.
