Retail Merchandising Unit – IIIMerchandise Management
Merchandising• Merchandising is Planning, Buying and selling of Merchandise• Its all about having right product in the right quantity available at the right place, at the right time and at the right price.• More easier said than done as more selling locations and more merchandise varieties are added.• Magnitude of error and sub-optimal allocations can result as a part of 5 rights• It is the core of retail
Merchandise Management• Analysis: Understand customers to make ascertain their needs and desires for good buying decision• Planning: Plan the merchandise to be sold in the future now• Acquisition: Acquire merchandise from different vendors• Handling: Keep the merchandise in proper condition where it can be sold easily• Control: Control money spent in procuring merchandise.
A Theory of Merchandise BuyingBehaviour Retailer Size Type of merchandising Retailer Type Product Positioning Retailer Location Regulatory Constraint Management Mentality Type of Decision Merchandise Requirements Choice Ideal Supplier / Calculus Product Choice Supplier Selection Choice Choice Choice Calculus Calculus Calculus
The Merchandiser: Role andResponsibilities• Planning • Sales Forecasts • Preparing Budgets for the responsible area• Directing • Guiding and Training Buyers (Procurers)• Coordinating • Coordinating the Buying Team (Procurement Team)• Controlling • Assessing merchandise performance and buyer’s performance • Evaluate Buyer’s performance on Net Sales, Gross margins, stock turn
The Buyer: Role and Responsibilities• Developing merchandise strategies for the product line, store or organization that he/she is responsible for• Planning and selecting merchandise assortments• Vendor Selection, development and management• Pricing the merchandise to achieve the targets in terms of gross margins• Inventory Management
The Buying Function• Differs from Organization to Organization• Job akin to that of a Product Manager• More Strategic• Can be Centralized or Decentralized depending upon the type of organization
Buying for a Single / IndependentStore• Coordinating the purchasing for various products required by the store• Writing orders• Handling special orders as and when they rise• Making decisions regarding merchandise returns• Remerchandising the store• Pricing decision for the product• Planning and coordinating various promotional activities• Customer contact and selling
Buying for a Chain Store• More Specialist function• More Centralized buying and Merchandising• Understanding the consumers• More diverse distribution function
Buying for Non – Store Retailers –viz. Catalogues, Direct Mail etc.• More Planning required• Fair amount of market work required• Clear understanding on type of merchandise• More stress on Uniqueness of product
Concept of Lifestyle Merchandising• Retailer knowingly adopting a merchandise strategy serving the need of a specific target audience leading a specific lifestyle• Furniture, Cookware, Watches, bags, etc.