RETAIL MANAGEMENT

AGENDA
Concept

of merchandising planning. of merchandising

Implications

planning
Process

of merchandising planning
hierarchy

Merchandise

THE CONCEPT OF MERCHANDISE PLANNING

Merchandising Planning
planning 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 PLANNIG

Finance Purchase order and profitability. Marketing Advertizing and sales promotions. Warehousing & Logistics Merchandise receiving and verification. Store operations Space planning, avoid duplication.

Finance
Payment to suppliers, Profitability measurements

Marketing New product introductions, Developing ads

Details of Purchase Order Details of allocations

Development sales promotions

Warehouse & Logistics

Merchandise planning

Store Operations
Space planning, Communication about new products & their features,

PROCESS OF MERCHANDISING PLANNING.

Developing a sales forecast Determining the Merchandise Requirement Merchandise Control Assortment 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 Budget
sales 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/ basic Fashion Seasonal Fad Style

ASSORTMENT
Width Depth

12 MERCHANDISING PLANNING

Range plan with price points, briefing by Category manager to the team. Co-ordination 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 dept

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PROCESS OF MERCHANDISE PLANNING

Planned sales: Projected sales for the period Planned purchases: Projected purchases for the period Planned reductions:
Markdowns: Reduction in prices for Bad quality, Competition, Trend change etc Employee discounts: Inventory shrinkage: Theft, pilferage

Planned markups:
Planned difference in selling and cost (It is not a gross profit) Markup% = (Selling price Cost price)/ Selling price

Gross margin
Gross margin = (Selling price Cost price - Reductions)

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 reductions for the month.

MERCHANDISE CONTROL- ADVANTAGES

Limits over and under buying Prevents loss of sale due to unavailability. Maintains purchase within budget. Reduce markdowns due to excessive purchase.

ASSORTMENT PLANNING TYPES

The 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 PLANNING

Menswear
DEPARTMENT

Shirts

Trousers

accessories

PRODUCT LINE

Zodiac

Van Heusen

Louis Phillippe

Arrow

BREADTH

DEPTH

Style

Color

SIZE

ASSORTMENT PLANNING
VEND OR X STYL E C- X UNIT S 8 COST S 800 RETAIL PRICE 1200 PLANNED PURCHASE TOTAL JAN FEB MAR APR 15 20 25 15 75

F - XX 8

960

1350

10

25

10

20

65

EXL

900

1500

30

22

15

18

85

RANGE PLAN - BALANCE

Limits over and under buying. Sufficient choices for customers. Satisfactory product quantity available.

Aesthetic minimum lower limit of range width.

MODEL STOCK PLAN

Precise items and quantity for merchandise line. Identification of customers buying decision Identification of levels under attributes. Allocation of total units respectively based on demand.

MODEL STOCK PLAN - 100 SHIRTS

TYPE DRESS CASUAL FORMAL SPORT

% OF SALES SIZES

10

40

20

30

SMALL

MEDIUM

LARGE

X LARGE

% SALES

25

40

25

10

SLEEVE LENGTH % OF SALES

FULL

HALF

30

70

TOOLS FOR MERCHANDISE PLANNING

Marketmax MMS Retail pro Ms- excel