E6-35. Evaluating Grocery Stores Using Efficiency Ratios

Below are data for three publicly traded grocery stores that range in size from local (Village Super Markets) to regional (Publix) to national (Kroger). Use the ratios below to answer the requirements. Assume

that the companies sell roughly the same mix of products and face about the same inventory costs.

Fiscal 2018 Publix Kroger Village Super Market

Gross profit margin %. . . . . . . . . . . . . . . . . . . 29.6% 21.7% 27.2%

Number of stores at year-end. . . . . . . . . . . . . 1,211 2,764 30

Sales ($ per square foot) . . . . . . . . . . . . . . . . $639 $677 $1,165

Sales per store ($ millions). . . . . . . . . . . . . . . $ 30 $ 44 $ 54

Average store size (thousand square feet). . . 47 65 46

COGS (per square foot) . . . . . . . . . . . . . . . . . $450 $530 $ 848

Days inventory outstanding . . . . . . . . . . . . . . 26.5 25.7 12.6

Required

a. On average, which company has the freshest food?

b. Which company is least efficient with its space?

c. Which company has the lowest prices?

d. Which company is busiest?

e. Which company has the smallest stores