Same-store sales are widely reported by publicly owned retail chains as a key element of their operational results.
Seasonal and geographical variations are removed from the measurement: instead of collecting an average over periods and location, annual changes in performance are revealed.
Growing same-store sales can be explained by several reasons, including market share gains in a retailer's trade areas; higher average purchases and/or more frequent customer visits; and successfully cross-selling into a broader product range or upselling to more expensive ones.
As large retail chains expand geographically they eventually run out of prime locations and often end up cannibalizing their existing stores to some extent, which leads to a relative decline in this metric.
This makes same-store sales a useful metric not only for external assessments of a retailer's performance but also for internal benchmarking guiding store opening, remodeling, and closing decisions.