You already have next year's remodel list. We tell you what order to build it in.
A capital program gets approved on one average lift number. That number tells you whether to run the program. It says nothing about which sites go first, which is the only decision you actually have to make each year.
Illustrative. Same 12 sites, same budget for 6 remodels. The list you fund depends entirely on which column you sorted.
Sorting by volume funds $838K of recoverable headroom. Sorting by headroom funds $972K, out of the same budget and the same list.
The money is in the order
Say you're funding 12 remodels a year. The list gets built on store volume, on which general manager pushes hardest, and on the quality of the trade area. That third one is close to the opposite of the right criterion.
A site in a strong trade area is usually already producing most of what its conditions allow, so there's less there to recover. Fund it and you pay for a result the location would have delivered had you never touched it. The sites with room to move are the ones whose conditions say they should be doing better than they are.
The same budget, spent on a different 6 sites, returns a different number. We size that difference before you commit the capital, and we tell you which sites on the list shouldn't be on it at all.
How the order is built
Two parts. Only one of them is hard.
We model what each site should produce given the conditions it can't change in the short run:
The fitted number is what a typical site facing those conditions produces.
Actual minus fitted is the gap.
What share of that gap a remodel actually closes, estimated from conversions the chain or its peers already completed. This is the harder number and the one you'd expect to need most.
You don't need the recovery rate to set the order. The same rate multiplies every site's headroom, so ranking by headroom times a constant gives exactly the same ordering as ranking by headroom alone. The sequence is provably unchanged by the number that's hardest to estimate.
- You need the recovery rate to state the dollars.
- You never need it to state the order.
What has to be true of the sites below the cut line
A ranking that stops at the cut line tells you where this year's money goes and nothing about the rest of the chain. The more useful half of the read is the diagnosis underneath: why a site ranked low, and whether that's fixable before the next tranche.
The site is already producing close to what its conditions allow. A remodel buys very little here. Nothing about the site needs fixing, and it should come off the list rather than sit near the bottom of it.
The gap is real, but it sits in something a remodel doesn't touch: food execution, hours that don't match the posted ones, staffing at the register. Spending capital here fixes the wrong thing. These sites get a different lever, and they move up the list once the gap shifts into something a build can address.
The gap is in format, layout, fuel positions or capacity. These are the sites to look at again next year, and we tell you what would have to change for them to clear the cut.
That's a prescription per site rather than a score per site. A score ranks the list. A prescription tells you what to do about the part of the list you can't fund.
What lands on your desk
The ranked list. Every site on your capital plan, ordered by headroom, with the dollar range each remodel is expected to return and a confidence grade.
The sites that come off. Which entries on your list don't pay, what each one would have returned had the remodel gone ahead there, and what the same money returns at the sites that replace them.
The readiness note. For every site below the cut line, which of the 3 explanations applies and what would have to change for it to clear next year.
What it costs
Scaled by the number of sites on the capital plan rather than by chain size, because the work is in the plan rather than in the network. Budgeted over the period and paid monthly. It runs on the same 2 years of sales data a Lever Board engagement uses, plus your current capital plan.
Where this sits
We can get further without your data than you would expect. The dollar column is where that stops.
| You give us | You get | |
|---|---|---|
| Store-to-Store Read | Nothing | Which of your stores are underperforming, and what your customers say is wrong with them |
| Calibration Read | One data export | What the changes you've already made actually contributed to in-store sales |
| Lever Board | 2 years of sales data | Every proven lever ranked and suggested for each of your stores, with its lift contribution evaluated |
| Remodel Sequence Read | 2 years of sales data and your capital plan | Which sites on your capital plan should get the money first, which shouldn't get it at all, and what would have to change for the rest |
| Monitoring | Nothing new | Verdicts as the reads settle, plus where a lever is not showing up in the data the way it should, which usually means it is not being executed the way it was specified |