Cracker Barrel 2014 Annual Report Download - page 20

accounted for a 0.2% decrease in restaurant cost of goods sold
as a percentage of restaurant revenue.
We presently expect the rate of commodity ination to be
approximately 4% to 5% in 2015 as compared to 2014.
We expect to partially oset the eects of food commodity
ination through a combination of menu price increases,
supply contracts and other cost reduction initiatives.
e following table highlights retail cost of goods sold as a
percentage of retail revenue for the past three years:
2014 2013 2012
Retail Cost of Goods Sold 51.9% 52.4% 52.1%
e decrease in retail cost of goods sold as a percentage
of retail revenue in 2014 as compared to 2013 resulted
primarily from lower freight, higher initial markup on retail
merchandise, lower shrinkage and a reduction in the
obsolescence inventory reserve partially oset by higher
markdowns.
2013 to 2014
(Decrease) Increase as a
Percentage of Total Revenue
Freight (0.4%)
Higher initial markup on merchandise (0.2%)
Retail inventory shrinkage (0.1%)
Obsolescence inventory reserve (0.1%)
Markdowns 0.4%
e increase in retail cost of goods sold as a percentage of
retail revenue in 2013 as compared to 2012 resulted from
lower initial markup on retail merchandise partially oset by
lower freight and shrinkage.
2012 to 2013
Increase (Decrease) as a
Percentage of Total Revenue
Lower initial markup on merchandise 0.6%
Freight (0.2%)
Retail inventory shrinkage (0.1%)
Labor and Related Expenses
Labor and other related expenses include all direct and
indirect labor and related costs incurred in store operations.
e following table highlights labor and other related expenses
as a percentage of total revenue for the past three years:
2014 2013 2012
Labor and other related expenses 36.0% 36.5% 36.8%
e year-to-year percentage change from 2013 to 2014
resulted from the following:
2013 to 2014
(Decrease) as a Percentage
of Total Revenue
Store bonus expense (0.3%)
Employee health care expenses (0.1%)
Store hourly labor (0.1%)
Lower store bonus expense in 2014 as compared to
2013 reected lower performance against nancial objectives
in 2014 as compared to the prior year.
e decrease in our employee health care expenses as
compared to the prior year is primarily the result of the
reimbursement of approximately $4,700 for certain health
care premiums related to the plan year ending December 31,
2013 partially oset by higher enrollment and higher net
premium costs related to the plan year ending December 31,
2014. During 2014, we recorded a receivable of $6,200
for reimbursement of certain health care premiums related to
the plan year ending December 31, 2014 of which $3,600
reduced employee health care expenses in 2014. We presently
expect to record an additional reimbursement of approxi-
mately $2,000 to $4,000 in 2015 related to the plan year ending
December 31, 2014.
e decrease in store hourly labor costs as a percentage
of total revenue from 2013 to 2014 resulted from menu price
increases being higher than wage ination and improved
productivity.
e year-to-year percentage change from 2012 to 2013
resulted from the following:
2012 to 2013
(Decrease) Increase as a
Percentage of Total Revenue
Store hourly labor (0.5%)
Store bonus expense 0.2%
e decrease in store hourly labor costs as a percentage
of total revenue from 2012 to 2013 resulted from menu price
increases being higher than wage ination and improved
productivity. Higher store bonus expense in 2013 as compared
to 2012 reected beer performance against nancial
objectives in 2013 as compared to the prior year.
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