Same-store sales

What it means

Same-store sales, sometimes called like-for-like or comparable-store sales, strip out the effect of opening new outlets. By comparing only outlets that traded in both periods, they reveal whether the underlying business is growing rather than whether the network is simply adding sites.

This distinction matters because total network revenue can rise purely from opening more outlets, even if each existing outlet is flat or declining. Positive same-store sales suggest genuine demand and pricing strength; negative same-store sales can be an early warning even while the network expands.

Same-store sales are a widely used retail and franchising metric rather than a Franchising Code disclosure requirement. Franchisors are not obliged to publish them, so where they are provided, it is worth understanding exactly which outlets and periods are included.

In practice

For a prospective franchisee, same-store sales trends indicate whether existing operators are experiencing growth or pressure. A network expanding rapidly on new openings but with flat or falling same-store sales may be relying on new franchisee fees rather than healthy outlet trading.

Because the metric is not standardised or required, treat any figures critically. Ask how same-store sales are calculated, which outlets qualify, and whether the comparison accounts for factors like refurbishments or major local events that could distort the trend.

A real example

A juice-bar franchisor reports that total sales grew 20% last year, but same-store sales, covering only the outlets open for the full two years, were down 3%. The headline growth came almost entirely from new openings, while established outlets were slightly declining, an important nuance for anyone joining the network.

Same-store sales — FAQs