Retail
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Retail

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Retail Presentation Transcript

  • 1. Retail Merchandising 1 Shri rangan
  • 2. Objectives
    • To demonstrate the importance of a sound merchandising philosophy
    • To outline the considerations in devising merchandise plans: forecasts, innovativeness, assortment, brands, timing, and allocation
    • To discuss category management
    • To study various buying organization formats and the processes they use
  • 3. Retail Merchandising
    • Definition & the Concept of Retail Merchandising
    • Role & Responsibilities of a Merchandiser
    • Fashion Merchandising
    • Merchandise Characteristics
    • Merchandise Management- Merchandise Mix & Merchandise Budget
    • Basics of Merchandise Accounting
  • 4. RM - DEFINITION
    • Retail selling effort that is the principal task of in-store sales personnel through the use of promotions designed by a manufacturer, such as unique displays, giveaways, or discount and premium offers. In this case, merchandising is the act of managing and arranging the merchandise on display in a store so as to promote its sale .
  • 5. Role & Responsibility of Merchandiser
    • Planning
    • Directing
    • Co-ordinating
    • Controlling
  • 6. Merchandising Versus Store Management Career Tracks
  • 7. Functions of Merchandisers at Shopper’s stop
    • Inventory-turn Management
    • Achieving Sales & Margins
    • Plans Merchandise
    • Availability Management, as per range plan
    • Merchandising strategy & planning
    • Processing of purchase orders
    • Analysis of Data & Sales Budgeting
    • Profitability Targets & Expense Control
    • Vendor/Supplier relations for both, in-house products as well as for brands.
  • 8. ARRANGING -MERCHANDISE
  • 9.  
  • 10. Merchandising arrangement
    • MERCHANDISING ARRANGMENT………
    • Why making effective use of your space is so important.
    • How to position your departments and products.
    • How to improve store lighting.
    • The importance of atmosphere and cleanliness in your store.
    • How to create great displays and signage.
    • WHAT WE WILL ACHIEVE AS A BUSINESS……….
    • The consistently best Display standards against Competition in India
    • A great environment that will attract & satisfy Customers
    • Showcase to best advantage our product offer
    • Dramatically enhance Customer Service
  • 11. Managing the Merchandise
    • Developing a sales forecast
    • Determining the merchandise requirements
    • Merchandise control
    • Assortment planning
  • 12. Developing Sales forecast
    • Reviewing Past sales
    • Analyzing the changes in Economic Conditions
    • Analyzing the changes in the sales potential
    • Analyzing the changes in the marketing strategies of the retail organization and the competition
    • Creating the sales forecast
  • 13. Forecasts
    • These are projections of expected retail sales for given periods
      • Components:
        • Overall company projections
        • Product category projections
        • Item-by-item projections
        • Store-by-store projections (if a chain)
  • 14. Determining the merchandise requirements
    • Merchandise Mix
    • Retail communication Mix
  • 15. Basics of Merchandise Accounting
  • 16. Merchandising Accounting
    • Cash Flow
    • The Balance sheet
    • Financial Ratios
    • Income statements
    • Gross- Margin-Return on Investment
  • 17. Cash Flow
    • Cash In
    • Cash Out
    • Negative Cash flow = Cash In < Cash Out
    • Positive Cash flow = Cash out > Cash In
  • 18. Cash Flow Curve Oct Nov Dec Jan Feb Mar Cash In Cash out
  • 19. The Balance Sheet
    • The Balance Sheet is a statement of an organization's Assets, Liabilities and Owners’ Equity at a Particular Point in time.
          • Assets
          • Liabilities
          • Owner's Equity
  • 20. Assets
    • Assets – Owned by an organization
    • a. Short term (or) Current Assets
    • b. Long term
  • 21. Liability
    • Liability: Debts owed by an organization
          • Payment on Short term
          • Ex: Payment to supplier
          • Payment on Long term
            • Ex: Mortgage on Land & Building
            • Investment on Extension, Expansion & renovation
  • 22. Owner’s Equity
    • Owner’s Equity : Difference between asset and Liability.
        • Relationship:
            • Assets = Liabilities + Owner’s Equity
  • 23. Income statement
  • 24. Income statement
    • Profit performance for a specific period of time
    • Income statement is otherwise called Statement of earnings or Profit & loss statement
    • Income statement:
            • Revenue – Expenses = Net Income
    • Profit = Expenses < Revenue = positive Net Income
    • Loss = Expenses > Revenue = Negative Net Income
  • 25. Income statement contd…
    • Income statement can be computed for an entire organization
          • Individual Store
          • A Group of Store
          • Department
    • Profit and loss is based on the revenue & expenses directly associated with each unit of business.
  • 26. Income statement contd…
    • Components : 5 major components
            • Revenue
            • Cost of goods sold
            • Gross margin
            • Expenses
            • Net Profit
    • Relationship among the components
    • Net revenue – Cost of goods sold - Expenses
            • Gross margin Net Profit
  • 27. Income statement contd…
    • Relationship among the components
    • Net revenue – Cost of goods sold - Expenses
            • Gross margin Net Profit
    • Net revenue : composed of sales, Leasing or renting property or interest on accounts
    • Net sales = Gross sales – Customer return
    • Gross sales are used to determine the customer return rates
      • Customer return rate = Customer returns x100
            • Gross sales
  • 28. Income statement contd…
    • High customer return rate is often indicates of issue related
    • a. Customer service
    • b. Quality
    • c. Fit of merchandise
    • High sales attest to the ability of an organization buyer to select assortments of goods that are appealing to the store’s target customers.
  • 29. Income statement contd…
    • Cost of goods sold (or) Cost of Merchandise sold (or) cost of sales
    • Cost of goods sold = Billed cost of Merchandise + work room costs +shipping cost – cash Discount - Returns to vendors
  • 30. Income statement contd…
    • Shipping cost : Delivery cost for transporting goods from supplier
    • Workroom costs: activities that prepare merchandise for sale ( steaming & pressing apparel)
    • Return to vendors : defective or slow selling goods returned to suppliers for credit
    • Cash discounts : Invoice concessions from suppliers for prompt payment
  • 31. Income statement contd…
    • Expenses: Payroll, rent, Utilities, advertising and interest on debt.
    • Direct Expense: attributable to a specific unit ( store rent )
    • Indirect Expense: is not attributable to a specific unit. ( news paper advertisement )
  • 32. Income statement contd…
    • Gross margin : Difference between sales and cost of goods sold.
    • Net Income : Gross Margin – Expenses
    • Income can be increased by Increasing sales
          • Increasing Gross Margin
          • Decreasing cost of goods sold
          • Any combination of above
    • Component Percentage :
    • Cost of goods sold = cost of goods X 100
          • Net sales
          • Gross Margin = Gross Margin X 100
            • Net Sales
            • Expenses = Expenses X 100
            • Net Sales
  • 33. GMROI Particulars Category A Category B Sales 300000 250000 Cost of Goods Sold 180000 100000 Gross Margin 120000 150000 Gross Margin % 40% 60%
  • 34. GMROI
    • Gross Margin Return on Investment
      • Integrates two performance
            • Gross Margin
            • Turn Over
    • To create a single measure of performance
            • GMROI = Gross Margin X Net sales
            • Net Sales Average Inventory
            • GMROI = Gross Margin / average Inventory
  • 35. GMROI for 3 Merchandise Categories Particulars Gross Margin Avg Inventory GMROI Specialty Food 120000 28000 4.3 Countertop Appliance 80000 40000 2.0 Glassware 200000 130000 1.5
  • 36. Key terms
      • Assets
      • Balance sheet
      • Cash discount
      • Cash Flow
      • Component Percentage
      • Cost of goods sold
      • Current ratio
      • Expenses
      • Factor
      • GMROI
      • Gross sales
    Income statement Liability Net Income Net Loss Net Sales Return to Vendor Owner’s Equity Time Series Comparison Workroom cost