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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