What's New with Torqata: Category Compass and Market Price Explorer Updates

February 18, 2021

We are excited to announce the latest updates to our Torqata tools. 21.1 is our first quarter major release for 2021! We have made improvements across the board, with the most noticeable ones in Category Compass and Market Price Explorer.

At Torqata, we understand your time is valuable and the decisions you make daily on what to stock and how to price is very important to how you operated your business, therefore we focused on simplifying the navigation, improving recommendation logic, and giving you more transparency into comparable.

Key benefits and updates:

  1. Review your inventory performance across all your stores at a glance

  2. Get recommendations that optimize for inventory profitability

  3. Understand the why behind our recommendations by seeing sales and demand data side-by-side

  4. More easily compare your prices with the local and national averages

Read details below to learn what has changed and how it can help you make better-informed, data-driven decisions for your business.


Category Compass

To improve the overall experience, we updated the way that we calculate our recommendations and how we present the data to you to make it more actionable and insightful.

What is different?

  • We added a new Current Inventory tab, updated the table within the recommendations tab (previously called ‘adjust existing stores’), and removed the Top Opportunities and Analysis tabs.

  • We introduced more data points for you to explore, allowing you to better analyze your store performance and the inventory recommendations. The most important columns are shown by default, but many more can be accessed from the column selector in the bottom left corner of each table.

  • New data in the recommendations tab allows you to analyze your store sales, and compare it to the market demand, to better understand why we are making certain recommendations.

Let’s dive into the details our new pages and what you can get out of them!

Current Inventory Tab

We added a new page to show you an overview of all your stores so you can easily compare them side-by-side and distinguish your top performers from your under performers. This will help you select the store that has the biggest opportunity for improvement.

The data for each store are key metrics based on trailing 12 month sales and gets updated every 2 weeks.

Here are a few highlights from the Current Inventory tab (either new or updated metrics):

Market coverage: Your market coverage is an estimate of the amount of customers in your local area you can serve with your inventory on hand.

You might notice an increase in market coverage compared to our prior version. This is due to the fact that we now calculate coverage based on Size and Tier only, and removed the Category and Speed from our groupings. Why did we do this?

  • Category can be implied from the size, and our categories often don’t align with how retailers think about them.

  • Speed caused some unexpected recommendations as in many cases retailers stock tires with higher speed ratings than the minimum required rating on a vehicle and our algorithm ended up recommending you to stock the lower speed rating. We decided we’d rather have you, as a retailer, decide what the right speed ratings are to hold rather than recommending you to remove a higher speed-rated tire in favor of a lower speed-rated one.

Sales from inventory: This is the amount of sales from the last 12 months that are from SKUs you have in your current inventory. This can give you an approximation of how many customers you were able serve on the spot versus having to order the tires on demand from your distributor or warehouse. You can see this metric both as a sales count as well as a percentage of total sales.

Gross Margin on Inventory (GMROI): GMROI is a calculation that looks at the profitability of your inventory. GMROI is calculated by dividing your profit from inventory by your cost of inventory. Our recommendations are based on GMROI rather than sales, as it takes into account both sales volume and margin on your sales for each tire.

  • GMROI (units) is what is described above. But this would mean that the GMROI of an SKU with 20 units on hand will be much less than an SKU with only 2 on hand. As we divide the profit from that tire (e.g. $5,000) by the cost of what you have on hand. So having 2 units on hand can give you a cost of $200 and having 20 on hand would give you a cost of $2,000.

  • Since our recommended inventory primarily contains sets of 4 units (instead of 2 or 20), we wanted to introduce a way to compare both inventories more objectively. This is were GMROI (SKUs) comes in. For this metric, we use the cost of one set of 4 units for each SKU you have on hand, and for what we recommend, so you can assess how your 300 SKUs would compare to the 300 SKUs recommended by Category Compass, without any impact based on the amount of units you actually have in stock for each.

Recommendations Tab

You will notice we changed the way we calculate our recommended inventory. We now look at the GMROI of your potential inventory (based on a mix of your sales and the market demand) and will rank SKUs based on its GMROI percentage.

Updated inputs: We simplified the amount of inputs we require to be able to run a recommendation, and we have smart defaults that enables you just to hit the ‘generate recommendation’ button without any configuration needed.

  • Amount of tires to stock: You can either set an amount of SKUs or units you want to hold. If you select SKUs you will get one or two sets of four tires for each. We default to the same amount you have in your current inventory so that you can compare apples-to-apples the performance of your current inventory with the newly recommended inventory

  • Recommendation formula: When creating a recommendation, we wanted to give retailers more control over how the potential sales are generated. In the past we used a formula that was 25% store sales, 50% expected tire sales in your local area and 25% ATD sales. Now, you can set your own ratio between store sales and market sales (market sales is 70% expected tire sales and 30% ATD sales). We default to a 50/50 split between both as we believe that gives you the best mix of optimizing for current and potential customers.

  • Stocking thresholds: These are inputs that will define when to stock more or less than one set of tires

    • You can set a sales amount above which you want to stock an extra set of 4 (e.g. 20 sales per month).

    • You can set a threshold under which you don’t want us to recommend you to stock something (e.g. less than one set per year). Note that if you set this number high, we might not be able to give you the amount of units to stock as you provide us in your tires to stock input.

Here are a few highlights from the updated recommendation table:

Rank: The recommendation table is ranked by the Size-tier groups with the highest potential GMROI (the ones you are likely to make the most profit from compared to the cost to hold it in your inventory).

Sales, market sales, potential sales:

  • Sales are your sales in the last 12 months across all tires within the same size and tier.

  • Market sales are the amount you would have sold if your sales had the same proportion to the sales in your market for that same size and tier. Basically multiplying the market demand by your total trailing twelve moth sales.

  • Potential sales is calculated based on your recommendation formula (the mix between your sales and market sales you used to calculate the recommendation)

Recommended product(s): This column shows SKUs you have sold in the past 12M for which we give you an add, maintain or remove recommendation based on how much profit they generated for you. If you sold more than one SKU within a certain size and tier, they will show up together (same rank) so you can easily compare. If you haven’t sold a product in that size and tier before, we will recommend you the highest margin option available.

Potential GMROI: This is the column you can sort by to see all the SKUs we recommend you to add to your inventory ranked by the most profitable first. This is not just based on your last 12M sales, but your potential sales calculated by your recommendation formula.

Recommendation: This column says whether we recommend you to add, maintain or remove a tire from your inventory. You can filter by ‘add’ to see only those SKUs we recommend you to add. Sorting by GMROI or sales or profit will show you the most relevant ones first. To see which one to remove you can filter by ‘remove’ instead, and sort by market demand (ascending - arrow up) to find the ones you have in stock with the lowest market demand for them (likelihood of finding a customer to sell them to).

Learn more about how Category Compass works

Market Price Explorer

Market Price Explorer has a few new columns available that should make it easier for you to compare your price with the local and national averages.

Here are the new metrics we introduced:

  • You vs local average: This should the percentage difference between your price and thee average of your nearby competitors. The data for your nearby stores is an approximation based on available data and does not come from the Torqata POS data set yet. This will update once we are out of our pilot phase and have more retailer penetration.

  • You vs national average: This is the same as the above, but using the price at top national retailers such as Discount Tire, Walmart and Sam’s club as well as online retailers like Amazon and eBay.

Learn more about Market Price Explorer

What’s next?

At TQA, we believe in continuous improvement and our priorities are to keep improving on our products so that they are customer-centric! Here are some highlights of what we have on our roadmap for 2021:

Category Compass:

  • Multiple ways to summarize your data (e.g. by brand, size or tier)

  • Improved ways to calculate market coverage based on your stocking levels

  • Different timeframes to calculate recommendations (alternative to trailing 12 months)

Market Price Explorer:

  • View prices from specific national retailers of your choice

  • See price trends over time, not just averages


  • Track your KPI for each of your stores and across your network

  • See the impact of your inventory and pricing decisions


Thanks a lot for being a trusted customer and don’t hesitate to contact us with any questions or feedback.