1. Content
Introduction………………………………………………………………………………………… i
Chapter 1 About the Brand
- Product………………………………………………………………………………….1
- Price……………………………………………………………………………………...1
- Promotion……………………………………………………………………………….3
- Place………………………………………………………………………….………….3
- Target Market…………………………………………………………………………..4
Chapter 2 Assortment Planning
- MerchandiseClasses…………………………………………………………………5
- Selection Factors………………………………………………………………………5
- Merchandise1st month’s Inventory………………………………………………..8
- Inventory of Dresses…………………………………………………………………..9
Chapter 3 Sales Planning
- AverageMonthly Sales…………………………………………………………….10
- Sales Projection of 12 months……………………………………………………...11
- Expenses………………………………………………………………………………12
Chapter 4 6-month Merchandise Plan
- Initial Mark-up…………………………………………………………………………14
- Final MerchandisePlan……………………………………………………………..17
- Assortment Plan for the 1st month-Dresses……………………………………….18
- Stock List………………………………………………………………………………..19
Conclusion………………………………………………………………………………………….21
References………………………………………………………………………………………… ii
2. INTRODUCTION
With the rise of new retail brands entering the market, it is essential to make merchandise
planning to start a new brand to meet consumers’ purchase requirements. A good
merchandise plan enables company to maximise their sales potential and minimise the
losses.
The purpose of this project is to introduce a merchandise plan for a brand that will newly be
launched in Singapore starting from July 2016. Our brand identified is Wonders Cease, the
middle-high womenswear label originated from Sydney, Australia. Wonders Cease started
their business since 2009 as an e-store. It carries smart day and occasion wear for ladies
and focuses on producing high quality fabrication with simple yet clever details on apparels.
Wonders Cease has very unique signature aesthetic, such as sharp tailing with soft detailing
and simple silhouette in luxurious fabric. In Singapore, this brand will attract the professional
women who are looking for the feminine and classy look yet timeless styles.
This report presents the merchandise plan for Wonders Cease. Assortment planning, sales
projection, inventory management, sourcing, margins, and costing for this brand are included
in our written proposal. In addition, there will be a section which discusses the 6-month
Merchandising Plan to ensure profitable merchandising.
3. CHAPTER 1 ABOUT THE BRAND
PRODUCT
For a brand who emphasizes more on quality than quantity, Wonders Cease has a limited
product range. This fashion label distributes tops, bottoms, dresses, jackets, and
accessories. With a simple cut and interesting design details or bold colours paired with
neutrals in a luxurious fabric, they contribute feminine, modern and timeless look as the key
styles of the brand.
PRICE
The price for accessories is around $50 in Singapore dollars. The product price range for
tops is from $150-$250. For Bottoms, the range is from $100-$300. Besides, the price of
dresses vary from $200-$400. Finally, jacket’s price line is from $300-$400.
Figure 1 Wonders Cease logo
4. TOPS @$218.40 BOTTOMS @$126.00
0
TOPS @$218.40
DRESS @$274.40
0
TOPS @$218.40
JACKET @$308.00
Figure 2 Products and Price Range of Wonders Cease
5. PROMOTION
Wonders Cease’s promotion is visible on online advertising and social networking such as
Facebook. In addition, they had come up with some shopping events which held in Australia
last December 2013.
PLACE
Until now, Wonders Cease does not have any brick and mortar business yet. For the
proposed project, the first store of this fashion brand will be launched in Singapore.
The first store for this brand will be located in Ngee Ann City. Ngee Ann City is a shopping
and commercial centre located at Orchard Road which has connection with many attractive
places such as Wisma Atria, ION, Wheelock Place, Isetan, Lucky Plaza and Civics plaza. On
the other hand, Ngee Ann City is a location which often holds promotional events. Therefore,
Ngee Ann City easily gathers crowds in that area which would delight visitors, especially the
target market of Wonders Cease. On top of that, Ngee Ann City has housing beauty salons,
bookstores, enrichment centres, and more than 30 Food and Beverages outlets serving
Western, Chinese, Thai, Korean, and Indonesian cuisine.
Figure 3 Ngee Ann City, Singapore
6. TARGET MARKET
Ladies in the age range of 25 to 40. Those are middle-upper women who generally look for
beautifully made pieces yet don’t mind spending money on quality. Smart buyers that want
something unique but not heavily trend focused, buying pieces for longevity as well as fun.
Figure 4 Target Customer
7. CHAPTER 2 ASSORTMENT PLAN
The main types of merchandise are Apparel.
For A pparel, we are carrying tops, bottoms, dresses and outers
Selection factors
Wonder Cease, for this range of product, the selection factors are:
1. Product Category:
4 main categories which is,
(a) Tops 50%
(b) Bottoms 20%
(c) Dresses 20%
(d) Outer 10%
2. Price Line:
(a) Tops
(i) $95-$165
(ii) $166-$245
Basic Sleeveless Tee
(iii) $325
Playsuit
(b) Bottoms
(i) Pants
$165-$275
(ii) Skirts
$95-$285
(c) Dresses
(i)$195-$375
(d) Outer
(i)$275-$395
8. 3. Style Type:
(e) Tops
Crop Top
Tee
Tank top
Shirt
Playsuit
Asymmetry Top
Basic Sleeveless Tee
(f) Bottoms
i) Pants & Shorts
High-waisted
Petal Shorts
Gather Pants
Culotte Shorts
Capri Pants
ii) Skirts
Fold skirt
Pencil skirt
Maxi
Mini
Culotte Skirt
(g) Dresses
(i) Wrap Dress
(ii) Curvature dress
(h) Outers
(i) Jacket
(ii) Cardigan
10. Chapter 3 SALES PLANNING
A sales projection contains planned monthly sales, expenses, profit, reductions,
and stock turnover. The purpose of doing a sales plan is to understand the sales
objectives which work as a guidance to develop a productive planning. This
section discusses about the sales planning for the first year of Wonders Cease.
Considering the store location of chosen brand will be at Ngee Ann City which
becomes an attraction to professional women as our target market, number of
garments planned to be sold in per day will be 10 pieces.
Category Quantity Price Quantity x Price
Tops 5 $ 150 $ 750
Bottoms 2 $ 300 $ 600
Dresses 2 $ 300 $ 600
Outer 1 $ 450 $ 450
Total 10 $ 2,400
Calculation for average monthly sales:
1 weekday = $2,400
On weekend, it will sell more than usual = A weekday sale + 20% (approximately)
= $ 2,400 + 20%
= $ 2,880
1 week = 5 weekdays + 2 weekends
= (5 x $ 2,400) + (2 x $ 2,880)
= $ 17,760
1 month (4 weeks) = 4 x $ 17,760
= $ 71,040
= $ 71,000 (round down)
$ 71,000 is the average month’s sales.
11. 2015 Sales Projection
Remarks Average
Month
Events Percentage Sales per
month
July High Grand Opening of
Shop
10% $ 89,000
August Low - 6% $ 53,000
September Average Hari Raya Haji 8% $ 71,000
October Low - 6% $ 53,000
November High Pre-Christmas 10% $ 89,000
December High Christmas 12% $
106,500
January Average Chinese New Year 8% $ 71,000
February High Chinese New Year 10% $ 89,000
March Low - 6% $ 53,000
April Average - 8% $ 71,000
May Low - 6% $ 53,000
June High Great Singapore
Sale
10% $ 89,000
Total $
887,500
On December, sales will be increasing sharply because of Christmas and New
Year Eve celebration.
Calculation for sales per month:
Average month = 100% / 12
= 8% ($ 71,000)
Low month = 6% x $ 71,000
8%
= $ 53,250
= $ 53,000 (round down)
High month = 10% x $ 71,000
8%
= $ 88,750
= $ 89,000 (round up)
(December) = 12% x $ 71,000
12. 8%
= $ 106,500
Planned Expenses, Profit, Reductions, and Stock Turnover
For operating expenses, it is compulsory to speculate the rental expenses,
staffs, promotion, renovation, visual display and buying trip for the new store in
Singapore. Estimated rental cost at Ngee Ann City is $ 15,000 per month while
expenses for 4 staffs will be $3,500 per month. As for buying trip to overseas,
expenses are expected to be around $10,000 a year. In addition, promotion once
a year for $40,000 is needed in order to get brand awareness. Lastly, $80,000
will be purchased for visual display of the store and renovation or damages will
be counted to $10,000 annually.
Expenses Amount of money ( per year )
Rental Cost $ 180,000
Staffs $ 168,000
Promotion budget $ 40,000
Renovation $ 10,000
Visual Display $ 80,000
Buying trip (overseas) $ 10,000
TOTAL $ 488,000
Operating expenses (%) = $ 488,000 / $ 887,500 x 100%
= 54.9%
For the purpose of maintaining the brand image, there will not be too much
sales discount for a new store, reduction will be counted as much as 5% of
annual sales for shortage, employee discount, and Mark Downs for big sales
promotion once a year on December (more sales).
Sales = $ 887,500
Reduction = 5% x $ 887,500 = $ 44,375 (annually)
1st
6-Months (Jul – Dec) = 60% x $ 44,375 = $ 26,625
2nd
6-Months (Jan – Jun) = 40% x $ 44,375 = $ 17,750
13. Reduction (Jul-Dec) = $ 26,625 ÷ $461,500 x 100% = 5.67%
Increasing the profit to 7% high could improve the productivity of the sales.
Profit = 7% x $ 887,500 = $ 62,125 (annually)
Profit (6 month) = $ 62,125 ÷ $ 461,500 x 100% = 13.4%
Cash Discount = 1% x $ 887,500 = $ 8,875(annually)
CD (6 month) = $ 8,875 ÷ $ 461,500 x 100% = 1.9 %
Alteration Expenses = 5% x $ 887,500 = $ 44,375 (annually)
AE (6 month) = $ 44,375 ÷ $ 461,500 x 100% = 9.61%
To balance the financial investment of the new brand, new stock will be available
every 2 months. Therefore, planned stock turnover (ST) is determined to 3.
14. Chapter 4 6-Month MERCHANDISE PLAN
Initial Mark Up
IMU = OE + P + Re ( MD + Shortage +ED) + AE – CD x 100%
Net Sales + Re
= $ 488,000 + $ 62,125 + $ 44,375 + $ 44,375 - $ 8,875 x 100%
$ 887,500 + $ 44,375
= $ 630,000 x 100 %
$ 931,875
= 67.6%
MU (Retail) = 67.6%
MU (Cost) = (100-67.6)%
= 32.4%
Basic Stock = Average Stock – Average Monthly Sales
= (6-Month Sales ÷ 3) – (6-Month Sales ÷ 6)
= ( $ 461,500 ÷ 3) - ($ 461,500 ÷ 6)
= ( $ 153,833 ) – ( $ 76,916 )
= $ 76,917
= $ 77,000 (round up)
19. CONCLUSION
In order to start a new brand, Merchandise Plan is a business requirement to ensure the flow
of merchandising is directed. For the purposed of deciding what products should be carried,
it is important to understand the micro and macro influences of the global market in
Singapore. Finally, the outlined assortment plan, sales projection, 6-month merchandise
plan, and stockist help as a guideline to achieve the planned profit and minimising the losses
REFERENCE
20. Omagari, Lisa. ‘Wonders Cease’. Timeout.com. Created 27 Apr. 2011. Accessed 20 Sep.
2014 < http://www.au.timeout.com/sydney/shopping/features/9165/wonders-cease>
‘Wonders Cease Fashion Label – Australian Womenswear’. Fashionreview.com. Created 27
Mar. 2012. Accessed 20 Sep. 2014 <http://www.fashionreview.com.au/wonders-cease/>
‘Wonders Cease’. TheGrandSocial . 2014. Accessed 28 Sep. 2014
<http://www.thegrandsocial.com.au/wonders-cease>
‘The Ceaseless Wonder of Light’. WondersCease.tmblr . Created 31 Jul.2014. Accessed 28
Sep. 2014 <http://wonderscease.tumblr.com/>
‘Ngee Ann City’ . Images. Wikipedia. Last revised 3 Sep. 2014. Accessed 5 Sep. 2014
<http://en.wikipedia.org/wiki/Ngee_Ann_City>
Best Fashion Blog. ‘Nabilah Abdullah’. StyleAnywherecom . Created 11 Oct. 2012.
Accessed 5 Sep.2014 <http://style-anywhere.com/2012/10/11/nadira-abdullah/>
Hunter, Josh. ‘Increase Store Profits by Increasing Mantained Markup’.
TransworldBusiness,com . Created 26 Aug. 2009. Accessed 12 Sep.2014
<http://business.transworld.net/19986/features/how-to-increase-store-profits-by-increasing-
maintained-markup/>
Kennan, Mark. ‘How to Calculate Gross Profit Margin Percentage’. SmallBusiness.
Accessed 12 Sep. 2014 <http://smallbusiness.chron.com/calculate-gross-profit-margin-
percentage-4133.html>
