Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Merchandising responsibilities are divided between 2 chains of command:  Store line  Buying line

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  To coordinate receiving and the movement of goods and people within the store  To train sales associates  To provide customer services  To control expenses, to maintain the building  To maintain store security

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Merchandise managers and buyers do all planning needed to bring the right merchandise into the store at the right time.  Those involved include  General Merchandise Managers  Divisional Merchandise Managers  Buyers

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  General merchandise managers (GMMs) or corporate merchandise managers (CMMs)  Set merchandising policies for the entire store  Responsible for sales volume  In charge of several divisions (women’s wear and accessories)

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Divisional merchandise managers (DMMs) are directors of single divisions  Examples of single division: junior sportswear

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Each division is composed of departments  Departments may be based on lifestyle, price range, or vendors.  Each department is segmented into classifications, a related group of merchandise  Buyers are responsible for the success of one or more classifications or departments.

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  The bridge between corporate marketing policy and merchandise buying decisions  Suggest what should be purchased and how to present it  Prepares seasonal fashion presentation for the store line

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  A long-range standard for fashion buying and selling  Sales from previous year are basis for the plan  Allocates specific amounts to each department for purchasing merchandise to meet demand, sales, and profits

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Economic conditions (recession)  Market and trend analysis  Population shifts  Local retail competition  Consumer demand variations  Seasonal consumer demand  Weather  Holidays  Physical expansions or alterations  Ability to merchandise effectively  Require marketing activities  Basic stock requirements  Average purchase price

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Receipt plans  Sales plans  Markup plans  Markdown plans  Promotional plans  Beginning of season stock level  End-of-month stock levels  Weeks of supply  Inventory shortages  Gross margin  Stock Turn  Discount taken  Units

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  A description of the types, quantities, prices, and sizes of merchandise that a buyer expects to purchase from vendors within a specific period of time  Must be detailed to ensure plans are met, but flexible enough to use in the market

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  A collection of various styles, quantities, and prices of related merchandise  Needs to be balanced to meet consumer demand and appeal to target customer

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Open-to-buy (OTB)- the value of planned purchases  Actual stock - Planned stock = OTB

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Knowledge extends from education and experience  Buyer will evaluate merchandise for quality, styling, and price  In-store experience very important

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Demographics and psychographics  Effect of economic conditions  Global influences  Market and Fashion trends  Influence of the media and celebrities  Competitors’ merchandise

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Micro-merchandising- identifying and serving one market niche  Recognition of diverse societies with diverse tastes and needs  National retailers must choose different merchandise region to region and store to store  Macro-merchandising-conveying the same image throughout the chain

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Advertising  request ads and media based on merchandise  Visual Merchandising  request window displays  Special Events  initiate fashion shows and special events

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Related to fashion cycle of consumer acceptance  What to buy  Finding and selecting merchandise  Working with advertising, display, special events  Training personnel  Marking down merchandise

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Broad Assortment Buying  Many styles with only a few pieces purchased  Narrow and Deep Buying  Few styles but many pieces purchased  Short-cycle Buying  Buying close to the selling season

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Line Buying  Purchasing from key resources  Key resources are those whose merchandise sells  Trend Buying  Seeking merchandise for its innovative style  Done to some degree by most retailers

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  National brands  Available nationwide  Helps customer identify with merchandise  May offer exclusivity  Private Labels  Offer cost savings  Exclusivity  Retailer becomes manufacturer

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Independent Resident Buying Offices  Store-Owned Resident Buying Offices  Associated Buying Offices  Corporate Buying Offices  International Buying Offices

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved. Difference between wholesale cost and the retail price of the merchandise Expressed as percentage of sales Must cover expenses and offer a profit

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Merchandise purchases have staggered delivery dates  Merchandise arrives at a central location  Counted and checked for quality  Information recorded in MIS  Fall out is reconciled  Chargebacks my be required  Merchandise then sent to stores

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Unit Control System  Track and maintain record of merchandise  Done by computer  Enable a buyer to keep track of consumer demand  Can identify quick sellers  Inventory Control  Dollar value of merchandise on hand  Done by computers

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Discrepancies between computer and physical inventories  Shortages mean a lower physical inventory than computer inventory Theft, damage, or clerical error  Overages indicate higher physical inventory than computer inventory Clerical error, misticketing, or shipment to wrong store

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Provide salespeople with required information  May be formal or informal  Multiple methods are used  Buyers need to convey enthusiasm to sales force

Frings: Fashion From Concept to Consumer, 9 th ed. © 2008 Pearson Education, Upper Saddle River, NJ All Rights Reserved.  Vendor Analysis  Comparisons  Sales-Related Ratios  Average Gross Sales  Sales Per Square Foot  Stock or Inventory turn  Gross Margin