Retail management

AGENDA

Concept of merchandising planning. of merchandising

Implications

planning Process

of merchandising planning

The concept of Merchandise planning

Merchandising Planningplanning and control of the merchandise inventory while balancing the customers expectation and retailers strategy. Right assortment of goods. Substantial depth - availability. Choice available to customer increases. Required goods always available.

Implications of merchandising plannigFi a n ce n

Details of

Purchase order and p ro fi b i i . ta l ty M a rke ti g Advertizing and n sa l s p ro m o ti n s. e o W a re h o u si g & Lo g i cs n sti e rch a n d i M se re ce i n g a n d vi ve ri ca ti n . fi o S to re o p e ra ti n s Space o l n n i g , a vo i d u p l ca ti n . p a n d i o

Payment to suppliers, Profitability measurements

Finance

Marketing N ew product introductions, Developing ads

Warehouse & Logistics

Purchase Order Details of allocations

Development sales promotions

Merchandise planning

Space planning, Communication about new products & their features,

Store Operations

4

Process of merchandising planning. Developing Determining Merchandise Assortment

a sales forecast

the Merchandise Requirement Control

Planning

Developing a sales forecast

Reviewing past sales Economic conditions. Sales potential. Marketing strategies and Competition. Creating the sales forecast.

Determining the Merchandise Requirement

Merchandise Budgetsales plan stock support plan Planned reductions Planned procurement Gross margin

Assortment

plan

Product range and models. Process can be top down / bottom up

Merchandise classification fresh

groceries Ready to eat snacks Addictives /spices/pickles. Personal hygiene products Cooking aids Necessities pulse, sugar salt , oil , wheat floor. Soft drinks/ juices.

Merchandise hierarchy Company Department Merchandise

classification Merchandise category Merchandise sub category Style price unit Stock keeping unit

Ready to eat Wafers

, biscuits , chips, snacks. Salted , sweet - category Branded , local- sub category Pack size / price 100 gm, 250 gm, 500 gm. SPP. SKU

Types of merrchandise Staple/ Fashion Seasonal Fad Style

basic-

ASSORTMENT

Width Depth

01/04/10 MERCHANDISING PLANNING

Range plan with price points, briefing by Category manager to the team. Coordination bt merchandiser Fabric inputs with Prices, Design and Quality break-up (Fabric team, Garment team, Merchandiser Colour palette forecast, alongwith Theme forecast or selection (Fabric team, Garment team, merchnadiser) Fabric design (Fabric designer) Costing/ Approvals Delivery lead times Garment Styling Sampling Packaging design Garment costing

Product range presentations Range approvals for styles & fabric Order bookings Raise purchase orders for fabrics & trims Garment & packing specifications to be made Handover complete specifications with fabric, trims to production dept12

Process of merchandise planning

Planned sales: Projected sales for the period Planned purchases: Projected purchases for theperiod

Planned reductions:

Markdowns: Reduction in prices for Bad quality, Competition, Trend change etc Employee discounts: Inventory shrinkage: Theft, pilferage Planned difference in selling and cost (It is not a gross profit) Markup% = (Selling price Cost price)/ Selling price Gross margin = (Selling price Cost price Reductions)

Planned markups:

Gross margin

13

Merchandise CONTROL open to buy

Adjusts merchandise buying

Sales Reductions

Maintains stock and sale relation.OTB = Planned EOM stock - projected EOM stock

Projected EOM stock = actual BOM stock + actual additions to stock + actual on order - planned monthly sale planned

Merchandise control- Advantages Limits Prevents Maintains Reduce

over and under buying

loss of sale due to unavailability. purchase within budget.

markdowns due to excessive purchase.

ASSORTMENT PLANNING typesThe process of deciding and arriving at the quantity of each product /category of merchandise. Purchase quantity. Color , size , brand , material. Classics, Fashion, Seasonal, Fad, Style

The process of Merchandise PlanningM e n sw e a rDEPARTMENT

Shi rts

Tro u se rs

a cce sso ri s e

PRODUCT LINE

Z odi c a

V a n H e u se n

Louis Phillippe

Arrow

BREADTH

Style

Color

SIZE

DEPTH

17

Assortment planningVEND STYL UNIT COST RETAIL OR E S S PRICE X C- X8 800 1200 PLANNED TOTA PURCHASE L JAN FEB 25 15 20 MAR 15 75 APR 10 20 30 18 25 10 65

Y

FXX EXL

8

960

1350

Z

6

900

1500

22

15

85

RANGE PLAN - Balance Limits Sufficient Satisfactory Aesthetic

over and under buying. choices for customers. product quantity available.

minimum lower limit of range width.

MODEL STOCK PLAN Precise Identification

items and quantity for merchandise line. of customers buying

decision Identification Allocation

of levels under attributes.

of total units respectively based on demand.

MODEL STOCK PLAN - 100 sHIRTSTYPE % OF SALES SIZES DRESS 10 SMALL CASUAL FORMAL SPORT 40 20 30 X LARGE 10

MEDIUM LARGE 40 HALF 70 25

% SALES 25 SLEEVE FULL

LENGTH % OF 30 SALES

TOOLS FOR MERCHANDISE PLANNING Marketmax MMS Retail

pro Ms- excel