RETAIL MEASUREMENT SERVICES

MEASURING & IMPROVING YOUR

BUSINESS WITH DISTRIBUTION DATA
OVERVIEW
This job aid provides an overview of the business questions, metrics or facts, and calculations that can be used to
drive business performance with distribution data. The term "distribution" refers to a variety of concepts all
centered around measuring a product’s movement and presence on the shelf. Distribution is the percent of stores
selling a product. Distribution is an important fact to consider when analyzing sales results, as it helps determine
sales potential, based on product availability.

BUSINESS QUESTIONS
When considering the business questions, you should evaluate your business against your own business, your
competitors’ businesses and the overall category or market. The questions in the chart below offer some insight
into the types of business questions that RMS distribution data can help you resolve.

DISTRIBUTION
How do my sales perform where I have distribution versus sales of competitors where they have
distribution? What are the trends in those areas?

Does my item have its fair share of distribution?

Did new items/line extensions add to a brand? Are they being swapped out?

Why is my volume down when my weighted distribution is unchanged?

How does my Out of Stock (OOS) situation compare to other brands and competitors?

How does my product availability compare to my competitors?

*Throughout this chart, the term “Area” or “Areas” refers to any product or market data dimension, such as
Brand, Segment, Item, Country or Region.

DISTRIBUTION TYPES
Review these terms and definitions as a foundation:

When dealing with Nielsen Retail Measurement Services Data, the general term, Distribution, refers
to the percentage of stores selling an item. Distribution may be used to understand how widely
available a product is.

In reality, both large and small stores exist in any market. The larger stores have more customers
per day. If your item is available in a large store, your business has more potential customers than a
small store. To give a better indication of that in the distribution metric, we weight the stores. This is
referred to as Weighted Distribution, the preferred metric for most analysis.
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MEASURING & IMPROVING THE BUSINESS WITH DISTRIBUTION DATA

DISTRIBUTION TERMS AND DEFINITIONS

Numeric Distribution (Physical Distribution)
Number of stores selling item/Number of stores in
The percent of stores in the universe that sell the item.
universe*100

Product: Red Circle 500ml bottle

Numeric Distribution: 67% (4/6=67%)
4 of 6 stores carry Red Circle 500 ml bottle.

Note: Distribution is not always available at all levels of every hierarchy. When unavailable, your solution will display null values
or “N/A” (not applicable).

Range

When additional products are layered into the store, that store
has a wider range of products. Distribution can also be
calculated for a range of items, such as one particular brand.
When used in this way, distribution tells us the percentage of Number of stores selling any item included in
stores that sell any item from the range. Range /Number of stores in universe*100

To derive distribution at the Range level, you must know the

mix of items in each store, which means it has to be calculated
in the local factories.

Products: Blue Circle 500ml bottle, Red Circle

500ml bottle and Green Circle 500ml bottle
Range Distribution: 83%
Brand 5/6 stores = 83% All three items are part of the Circle brand. We
can see that the circle brand is carried in five out
Item 67%
of six stores, although no one item is carried in all
Item 67% five stores. This gives us a Total Range distribution
of 83% at the brand level, when the highest item
Item 50%
distribution is only 67%. 5/6=83%

MAX and MIN Distribution

MAX distribution is the number that represents the largest distribution value for any one item in the range. MIN
displays the smallest distribution value for any one item in the range.

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MEASURING & IMPROVING THE BUSINESS WITH DISTRIBUTION DATA

WEIGHTED DISTRIBUTION
%ACV Weighted Distribution (All Commodity Volume, ACV)
ACV is the total sales volume of all items sold in one store, a banner, Sales value of all categories in all stores selling
or an entire market. %ACV Distribution weights the stores selling a product/Sales value of all categories in all stores in
product by their total sales, highlighting the relative importance of the universe*100
stores selling a product.
For example, a product with 75% ACV Weighted Distribution means
that item is sold in stores which account for 75% of total sales.

ACV Weighted Distribution: 85%

4 of 6 stores carry Red Circle 500 ml bottle, but
the weighted value for stores that carry the
item is 725 out of 850 total available.
Weight: 500 100 100 100 25 25 725/850=85%

PCV Weighted Distribution (Product Class Value, PCV, Percent Category Turnover)

%PCV Distribution follows the same principle as ACV Weighted Sum of total categories value sales in stores selling
Distribution, but weights according to sales of the Category, or product/Sum of total category value sales in all stores
Product Class. selling the category*100

Total Distribution Points [TDPs or SUM (CUMULATIVE) Distribution]

Total Distribution Points begin with weighted distribution, and then Use the lowest period granularity available (weekly or
factor in the number of items each store sells. This provides both the monthly, depending on the database), and then add the
breadth and depth of distribution in one metric. weighted distribution (%ACV) for all items.

TDP’s may explain volume changes that might not be seen when For an individual item, TDPs are exactly the same as True
looking at % ACV. Distribution in a single time period.

Example 1: Single item per brand per store

# of
% ACV TDP
Items
Brand Level 100% 3 190
Blue Dot Flavor 60% 1
Red Dot Flavor 90.5% 1 190 TOTAL
€5,000 €300,000 €95,000 €400,000 €200,000
Green Dot Flavor 39.5% 1
0.5% 30% 9.5% 40% 20%
(ACV) Weighted Distribution shows the breadth

Example 2: Multiple Items per Store (Each flavor has multiple pack sizes, represented by shades. )
# of
% ACV TDP
Items
Brand Level 100% 6 430.5
TDPs show breadth and depth Blue Dot Flavor 60 2 119.5
TDPs=[(0.5*1)+(30*2)+(9.5*2)+(20*2)]
Red Dot Flavor 90.5 3 271.5 TOTAL
TDPs=[(0.5*3)+(30*3)+(40*3)+(20*3)]
€5,000 €300,000 €95,000 €400,000 €200,000
0.5% 30% 9.5% 40% 20% Green Dot Flavor 39.5 1 39.5
TDPs=[(30*1)+(9.5*1)]
(ACV) Weighted Distribution shows the breadth

Dividing Total Distribution Points by %ACV gives the Average Number of Items Carried within those stores selling the brand.
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