week 4 merchandising

8/16/2019 Week 4 Merchandising

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Week 4

MERCHANDISING



19-2 Retail Mgt. 11e (c) 2010 Pea!"#E$%cati"#& I#c. '%li!i#g a!Pe#tice Hall

Ca'te *+ecti,e!

" $e#e /eca#$i!i#g a#$/eca#$i!e

" i$e#ti t'e! " /eca#$i!e!

" i$e#ti a#$ $e,el"'/eca#$i!e 'la#!

" $e#e categ" /a#age/e#t

a#$ te %!e " it



DEINII*N

Merchandising: Acti,itie! i#,"l,e$ i#ac3%ii#g 'atic%la g""$! !e,ice! a#$/aki#g te/ a,ailale at te 'lace!&

ti/e!& 'ice!& a#$ 3%a#titie! tat e#ale aetaile t" eac it! g"al!.

Merchandiser: A /eca#$i!e i! te'e!"# i# a etail %!i#e!! 5" $eci$e!5ic ite/! a#$ "5 /a# " eac "te!e ite/! t" kee' i# !t"ck.




Merchandising Philosophy

Sets the guiding principles for all the

merchandise decisions that a retailer makes It should reect

– Target market desires

– Retailer’s institutional type

– Market-place positioning

– Dened !alue chain

– Supplier capa"ilities – #osts

– #ompetitors

– Product trends




Scope of MerchandisingResponsi"ility

%ll aa " merchandisingfunctions

– 8%i#g a#$ !elli#g

– Selecti"#& 'ici#g& $i!'la& c%!t"/eta#!acti"#!

*R

"c%! "# buying function "#l


http://slidepdf.com/reader/full/week-4-merchandising 8/45 12-8

e 8%i#g *ga#iati"#

Merchandise Group

Department

Classification

Category

SKU

Comination of merchandise departments!"ach merchandise group is managed y a

general merchandise manager #GMM$

Departments are managed y

a di%isional merchandise manager #DMM$&

' group of items targeting the same customer

type #e(ample& girls si)es *-+$ ! ' uyer is

responsile for a merchandise classification

' category is made up of an assortment of

items the consumer sees as sustitutes for one another #e(ample& si)e *-+ dresses$

,he smallest unit a%ailale for in%entory control

Si)e& color& style& rand




Micromerchandising

Retaile! a$+%!t !el-!'ace all"cati"#! t"e!'"#$ t" c%!t"/e$i:ee#ce! a#$ "te

$i:ee#ce! a/"#g l"cal/aket!.




#ross-Merchandising

Retaile! ca

c"/'le/e#ta g""$! a#$!e,ice! t" e#c"%age!"''e! t" % /"e.




ig%e 14-2;

Atti%te!a#$%#cti"#!

"

8%i#g*ga#iati

"#!




Merchandising and Store $unctionsPerformed

Merchandising !ie%All %i#g a#$ !elli#g %#cti"#!

A!!"t/e#t!

A$,eti!i#g 'ici#g

P"i#t-"-!ale $i!'la!

E/'l"ee %tiliati"#

Pe!"#al !elli#g a''"ace!



14-1< Retail Mgt. 11e (c) 2010 Pea!"#E$%cati"#& I#c. '%li!i#g a!Pe#tice Hall

&uying !ie%8%e! /a#age %i#g %#cti"#!;8%i#g

A$,eti!i#gPici#g

I#-!t"e 'e!"##el /a#age "te ta!k!;A!!"t/e#t!

P"i#t-"-!ale $i!'la!E/'l"ee %tiliati"#Pe!"#al !elli#g a''"ace!

Merchandising and Store $unctionsPerformed 'cont()



=PES * MERCHANDISE

Sta'le /eca#$i!e

A!!"t/e#t /eca#$i!e a!i"# /eca#$i!e

Sea!"#al /eca#$i!e

a$ /eca#$i!e



=PES * MERCHANDISE

Reg%la '"$%ct! caie$ a

etaile – G"ce !t"e e>a/'le!; /ilk& ea$&

ca##e$ !"%'

&asic stock lists !'eci

i#,e#t" le,el& c"l"& a#$& !tle&categ"& !ie& 'ackage& etc.

Staple Merchandise



=PES * MERCHANDISE

A''ael& %#it%e& a%t"/"ti,e& a#$"te categ"ie! " 5ic te etaile

/%!t ca a ,aiet " '"$%ct! i# "$et" gi,e c%!t"/e! a '"'e !electi"#

Deci!i"#! "# a!!"t/e#t

– P"$%ct li#e!& !tle!& $e!ig#!& a#$ c"l"! ae'"+ecte$

– M"$el !t"ck 'la#

*ssortment Merchandise



=PES * MERCHANDISE

$ashion Merchandise; P"$%ct!tat /a a,e cclical !ale! $%e t"ca#gi#g ta!te! a#$ lie-!tle!

Seasonal Merchandise; P"$%ct!tat !ell 5ell ",e #"#c"#!ec%ti,eti/e 'ei"$!

$ashion and SeasonalMerchandise



=PES * MERCHANDISE

a$! –Meca#$i!e categ" tat

ge#eate! a l"t " !ale! " aelati,el !"t ti/e

–*te# le!! ta# "#e !ea!"# –S"t lie ccle

–M%!t ec"g#ie a$ i# it!ealie!t !tage!& get $i!ti%ti"#igt!& k#"5 5e# t" ail "%t



#*T+,R. M*/*,+M+/T

#ategory management i! a /eca#$i!i#gtec#i3%e %!e$ t" i/'",e '"$%cti,it.

It i! a 5a t" /a#age a etail %!i#e!! tat

"c%!e! "# te 'e"/a#ce " '"$%ctcateg" e!%lt! ate ta# i#$i,i$%ala#$!.

It aa#ge! '"$%ct g"%'i#g! i#t" !tategic

%!i#e!! %#it! t" ette /eet c"#!%/e#ee$! a#$ t" acie,e !ale! a#$ '"t g"al!.

Retail /a#age! /ake /eca#$i!i#g$eci!i"#! tat /a>i/ie te t"tal et%# "#

te a!!et! a!!ig#e$ t" te/.



#*T+,R. M*/*,+M+/T



Meca#$i!e Pla#!



Meca#$i!e Pla#!

$R+#*STS

These are pro0ections ofe1pected retail sales for gi!enperiods – #omponents:

!erall company pro0ections

Product category pro0ections Item-"y-item pro0ections

Store-"y-store pro0ections 'if achain)



12-2.

"eca!ti#g a!i"# Meca#$i!e

Categ"ie!

Retaile! $e,el"' a!i"# "eca!t! eli#g "#;

Pe,i"%! !ale! $ata Pe!"#al a5ae#e!!

a!i"# a#$ te#$ !e,ice!

?e#$"!

Maket e!eac



12-2*

Pe!"#al A5ae#e!!

Must "e a%are of trends thatcan a2ect the category’s sales(3o% do fashion "uyers kno% thetrends4

I#te#et cat ""/! @""k i# cl"!et! G" t" te /",ie! G" t" "ck c"#cet! G" t" #igtcl%!

Ryan McVay/Getty Images

SC'/

Shop the retail stores& 0e sites

and catalogs of competitors as a customer ouldCon%erse ith consumers& sales clers& and neighors

'ct lie your customer

/otice



12-23

a!i"# a#$ e#$ Se,ice!

8%e! !%!cie t" "eca!ti#g !e,ice! a#$ a!i"#'%licati"#!

e#$i#e (555.a!i"#I#"/ati"#.c"/)

D"#ege Ceati,e Se,ice! (555. D"#ege.c"/5e )

a!i"# S#""'! (555. a!i"#!#""'!.c"/)

W"/e#! Wea Dail (WWD)

H"/e %#i!i#g! Ne5! (HN)

http://www.fashioninformation.com/

http://www.doneger.com/web

http://www.fashionsnoops.com/

http://www.fashionsnoops.com/

http://www.doneger.com/web

http://www.fashioninformation.com/



12-2+

W"k 5it ?e#$"!

?e#$"! a,e '"'ietai#"/ati"# a"%t tei /aketi#g

'la#! (i.e.& #e5 '"$%ct la%#ce!&!'ecial '"/"ti"#!

Ca# a,e a !ig#ica#t e:ect "#

'"$%ct !ale!.



12-24

Maket Re!eac

A!k c%!t"/e! a"%t /eca#$i!e":ei#g! t"%g !%,e! " "c%!

g"%'! Mea!%e c%!t"/e eacti"#! t"%g

!ale! te!t! (/aket te!ti#g)

alk t" etail !ale! 'e"'le Mai#tai# a c%!t"/e 5a#t li!t



Meca#$i!e Pla#!

FACTOR RELEVANCE for PLANNING

,argetmaret#s$

"%aluate hether the target maret is conser%ati%e orinno%ati%e

Goods5ser%icegrothpotential

Consider each ne offering on the asis of rapidity ofinitial sales& ma(imum sales potential per time period&and length of sales life

6ashion

trends

Understand %ertical and hori)ontal fashion trends& if

appropriate

7etailerimage

Carry goods5ser%ices that reinforce the firms image

I//5*TI5+/+SS



Meca#$i!e Pla#!


Competition 9ead or follo competition in the selection of negoods5ser%ices

Customersegments

Segment customers y di%iding merchandise intoestalished-product displays and ne-productdisplays

7esponsi%enessto consumers

Carry ne offerings hen re:uested y the targetmaret

'mount ofin%estment

Consider all possile in%estment for each negood5ser%ice; product costs& ne fi(tures& andadditional personnel

I//5*TI5+/+SS



Meca#$i!e Pla#!


<rofitaility 'ssess each ne offering for potential profits

7is =e aare of the possile tarnishing of theretailers image& in%estment costs& andopportunity costs

Constrained decision

maing

7estrict franchisees and chain ranches from

uying certain itemsDeclining goods5ser%ices

Delete older goods5ser%ices if sales and5orprofits are too lo

I//5*TI5+/+SS



Meca#$i!e Pla#!

ASSORTMENT

Width of assortment refers to the numer of

distinct goods5ser%ice categories #product lines$ a

retailer carries!

Depth of assortment refers to the %ariety in any

one goods5ser%ice category #product line$ a retailer

carries!

'n assortment can range from ide and deep

#department store$ to narro and shallo #o( store$!



12-.2

'ssortment <lan for Girls >eans



14-<<Retail Mgt. 11e (c) 2010 Pea!"#E$%cati"#& I#c. '%li!i#g a!Pe#tice Hall

ale 14-2a; act"! i# Pla##i#gMeca#$i!e B%alit


,arget maret#s$ Match merchandise :uality to the ishes ofthe desired target maret#s$

Competition Sell similar :uality or different :uality

7etailers image 7elate merchandise :uality directly to theperception that customers ha%e of retailer

Store location Consider the impact of location on theretailers image and the numer ofcompetitors& hich& in turn& relate to :uality



14-<4Retail Mgt. 11e (c) 2010 Pea!"#E$%cati"#& I#c. '%li!i#g a!Pe#tice Hall

ale 14-2; act"! i# Pla##i#gMeca#$i!e B%alit


<rofitaility 7ecogni)e that high :uality goods generallyring greater profit per unit than lesser-

:uality goods? turno%er may cause totalprofits to e greater for the latter

Manufacturer%ersus pri%aterands

Understand that& in the minds of manyconsumers& manufacturer rands connotehigher :uality than pri%ate rands

Customer ser%icesoffered

Kno that high-:uality goods re:uirepersonal selling& alterations& deli%ery& etc!

<ersonnel "mploy silled& noledgeale personnel forhigh-:uality merchandise



14-<

Retail Mgt. 11e (c) 2010 Pea!"#

E$%cati"#& I#c. '%li!i#g a!Pe#tice Hall

ale 14-2c; act"! i# Pla##i#gMeca#$i!e B%alit


<ercei%ed goods5ser%ice enefits

'naly)e consumers! 9esser :uality goodsattract customers ho desire functionalproduct enefits? @igh-:uality goods attractcustomers ho desire e(tended productenefits

Constrained

decision maing

6ace reality! 6ranchises or chain store

managers ha%e limited or no control o%erproducts& so independent retailers that uyfrom a fe large holesalers are limited tothe range of :uality offered y thoseholesalers



Meca#$i!e Pla#!

Pri!ate

'dealer or store)

Manufacturer

(national)

,eneric

8RANDS



Meca#$i!i#g S"t5ae

Ge#eal Meca#$i!e Pla##i#gS"t5ae

"eca!ti#g S"t5ae I##",ati,e#e!! S"t5ae

A!!"t/e#t S"t5ae

All"cati"# S"t5ae Categ" Ma#age/e#t S"t5ae



Meca#$i!i#g Caee ack at

Mac!



St"eMa#age/e#t Caee

ack atMac!



DISCSSI*N BESI*NS

De!cie a#$ e,al%ate te /eca#$i!i#g'il"!"' " "% !%'e/aket.

Wat i! te $i!ti#cti"# et5ee# merchandisingfunctions a#$ buying function?

Wat ae te a$,a#tage! a#$ $i!a$,a#tage! "a ce#talie$ %i#g "ga#iati"#

#$e 5at cic%/!ta#ce! c"%l$ a etaile caa 5i$e a#ge " /eca#$i!e 3%alit 5it"%t%ti#g it! i/age We# !"%l$ te 3%alit "/eca#$i!e caie$ e 3%ite #a"5



DISCSSI*N BESI*NS

Wat ae te ta$e-":! i# a etaile! $eci$i#g"5 /%c t" e/'a!ie 'i,ate a#$! ateta# /a#%act%e a#$!

Pe!e#t a ceckli!t " ,e act"! " a cai#etaile t" e,ie5 i# $ete/i#i#g "5 t"all"cate /eca#$i!e a/"#g it! !t"e

Wat i! te a!ic 'e/i!e " categ"/a#age/e#t W $" "% ti#k tat!%'e/aket a,e ee# at te "#t " te/",e/e#t t" %!e categ" /a#age/e#t

week 4 merchandising

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