Unit 1
Unit 1
ntr
oduct
iont
oFashi
onMer
chandi
sing
1.
1El
ement
sandi
mpl
i
cat
ionofFashi
onMer
chandi
sing
Merchandisi
ng:Fashion mer chandising
canbedef ined ast heplanni
ng and pr
omoti
onofsal esby
pr
esentingapr oducttotherightmar ketattheproperti
me,bycar ryi
ngoutorgani
zedadver
ti
sing,usi
ng
at
tract
ivedisplays,et
c.Mer chandisi
ng,wi t
hinfashi
onr etai
l
,r ef
ersspeci
fi
call
ytothestockpl anni
ng,
management ,andcontrolpr
ocess.
Fashi
onmer chandi
ser
sfoll
owthefiv
eri
ghtsof
mer
chandi
sing,or5Rs,t
oensur
ethatt
heypr
oper
lymeet
theneedsofconsumers;
thus,
tur
ningapr
ofit
.
Thef
iver
ight
sofmer
chandi
singi
ncl
ude:
t
her
ight
mer
chandi
se
att
her
ight
pr
ice
att
her
ightt
ime
i
nther
ightpl
ace
i
nther
ightquant
it
ies.
Byr esearchingandansweringthefiveright
sofmer chandisi
ng,fashi
onmer chandi
ser
scangai nan
understandingofwhatproductsconsumer swant,whenandwher etheywi sht omakepur chases,and
whatpr i
ceswi l
lhav
ethehighestdemand.Bothfashi
onretail
ersandmanuf actur
ersutil
i
zethe5Rs.
Clothing manuf actur
ers practice f ashion merchandi si
ng di f
fer
entlythan r etail
ers. Manuf
acturer
mer chandisers
for
ecast
customer s'pr efer
encesforsilhouett
es,sizes,col
ors,quantiti
es,andcostseach
season.Whenmaki ngdeci si
ons, manuf actur
ermer chandisersmustkeepr etai
lersandendconsumer si n
mind.Fol lowingthef or
ecastingst age,manuf acturermer chandisersmeetwi thdesignerstodevelop
product st hatconsumer s willpur chase most .By r eferr
ing tot he fi
ver i
ghts ofmer chandi
sing,
manuf act
urermerchandisersdet er
mi net hebestfabr i
c,notions,productmet hods,andpr omoti
onsf or
]
product s.
Thesedecisi
onsallcont r
ibut etofi
nalr
etailcosts,whichmustbeaf fordabletoendconsumer s.
Retailer
sI ncompar i
sontomanuf actur ermer chandi sers,ret
ailermer chandi ser sal sobegi ntheirprocess
byfor ecast i
ngindustryandfashiont r endswi tht heirtargetmar ketsinmi nd.Sal esar epredictedi nr etai
l
doll
ar s and begi nni
ng oft he mont h( BOM)st ock.Si mil
art o manuf actur ermer chandisers,ret ail
er
mer chandi sersmustmakeal ldecisionsr egardi
ngt hefinalconsumer .Decisi onsar emadebasedont he
past, pr
esent ,andfutureoftheeconomy ,sal
es, i
ndust ryandf ashiont r
ends, r
egi onandwor ldev ents,and
thef ashioncy cle.Whenselectingmer chandiset oof fer,ret
ail
ermer chandiser swi llconsidertheirt arget
mar kets'col or,st yl
e,size,and cost pr eferences.Once accur ate deci sions ar e made,r et ail
er
mer chandi serswi l
lordergoodsf rom v endor sorpr oduce privatelabels. Fol l
owi ngshi pment ,order ed
seasonal apparelassort
ment sarest rategicall
yar rangedonsal esfloors,or visual lymer chandised.
Inthef ashionindustry,ther
earet wodif
fer
entmer chandisi
ngt eams:(1)thev i
sualmerchandisingt eam,
and( 2)thef ashionmer chandisi
ngteam.Thev isualmer chandi si
ngteam ar et hepeopleinchar geof
designingt hel ayout,fl
oorplan,andthedisplaysoft hest orei nordert
oi ncreasesales.Thef ashi on
mer chandisingt eam arethepeoplewhoareinvolvedint hepr oducti
onoffashi ondesignsanddi str
ibution
off inalproduct stot heendconsumer .Fashionmer chandi serswor kwi t
hdesi gnerst oensur et hat
designswi llbeaf f
ordableanddesiredbyt het argetmar ket .Fashionmer chandisinginvol
vesappar el
,
accessor i
es,beaut y,and housewares.The end goaloff ashi
on mer chandising i
n any oft hese
depart
mentsistoearnaprofi
t.Fashi
onmerchandi
sers'deci
sionscanconsi
der
abl
yimpactt
hesuccess
ofthemanufact
urer
,desi
gner
,orretai
l
erf
orwhichtheywork.
Inmoder nmer chandising,di
stri
butionresponsibil
i
tiesareabsent ,andf ocusisplacedonpl anni
ngand
analysis.Asepar atet eam istaskedwi thdistri
buti
on.Lar georganizat
ionsseparat emer chandiser
sby
type.Ther eare( 3)retailmerchandiser
sand( 4)productmer chandisers.Retai
lmer chandisersmanage
storeal l
ocati
onandmustmaxi mizesales.Pr oductmer chandisersmanaget hef l
ow ofmat eri
alst
o
suppliersandthent hef lowofpr oducttostores.Productmer chandiser
st henpasscont r
olofpr oductt
o
theretailmerchandisers.
Manyl ar
geor ganizat ionshav econcl udedt hatdi stri
but i
onr equi r
eshi ghl
ydet ailedwor kandt hatitis
necessar ytohav eat eam speci fi
call
yf orthatpur pose.Thi sisduet othefinedet ailsofal l
ocat i
on, which
requirefocusonaspect ssuchascol ourandsi zesf oraspeci fi
cst ore.Thisappr oachnotonl ymi nimizes
costsbutal soext endst oar easl i
kebet tercont r
oloft heov erallprocess.Or gani zati
onst hatdonot
conductdi stri
butiont hiswayr isklosingcont roloft heirstockatbot hthehi ghestandl owestl evel.Thisis
ar esultofthel ackofuni f
or mi t
yandov ersight .Thedi stri
butiont eam speci ali
zesnotonl yinmanagi ng
distr
ibuti
on,butt heyar eal sof ocusedonsal esandpr ofi
t.Theyempl oydet ail
ed,accur atei nformat i
on
aboutdi str
ibutionpoi nt ssour cedf rom pr oductpl anner s.Theypossesst heabi lit
yt omanagedy namic
stockdemands.Theypar t
nerwi thbuy er
sandmer chandi sersf oranynecessar yr epeatbuy ing.Though
theyar e positioned t o manage st ock,t heyst illoper ate wi t
hint he limitsoft he buying pl an,and
mer chandisersensur et heyr emai nwi thint hisr eal m.Buy ersprov i
degui deli
nesf ordi st
ri
butionsuchas
thet ypeofst oreswher epr oductshoul dbedi stributed;f orexampl e,apr oductmayhav eonl ybeen
acquiredf ort het op3st or es.Thet eam al sosuppor tst hegoal sofanor gani zationt hroughbei ng
i
nst r
ument alinr espondi ngt ot rends.Thenat ureofmoder nanal ysi
shasal lowedmanymer chandi sersto
planasmuchasf ourseasonsahead,andt heyar eexpect edt oappl ythedat a.Thi sf urt
herincr easet he
demandpl acedont hei rrolesandemphasi zest heneedt otaskoutmi nordet ail
st hatdonotr equi retheir
i
nputormuchoft hei rsuper vi
sion.
1.
2Ty
pesofFashi
onMer
chandi
sing
Thet erm“ Merchandiser” defi
nedasa ‘Personwhodobuy i
ngandsel l
ingofgoodsf orthepur poseof
maki ngapr ofi
t.
’
Infashioni ndustrytherear edi f
ferenttypesofmer chandisi
ngprofi
leswhicharemeant
toper f
orm dif
ferenttypesoff unct
ionsal ltogetheratdi ff
erentstagesoff ashi
onindustr
y.Overthey ears
oft hegr owthofmer chandi singasadi scipli
nei nthef ashionindustry
,therehavebeenmanychangesi n
the j ob profi
l
e oft hemer chandiser.Ithaschar gesf rom a simpl et o a much morecompl exj ob
transcendingal mostal lfunctionsinf ashioni ndustry.Thishasl edtoachangei ntheskil
lsrequiredfor
thej obandev oluti
onoft hedi scipl
ineoff ashionmer chandisi
ng.
Differenttypesofmer chandi singinfashioni ndustrycanbedescr i
bedi nfol
lowingway.
Ther ol
eofmer chandiseri sverycrucialanddemandi ngi nfashionindustr
y .Thedev elopmentofdesi gn,
product i
onexecut ionandsour ci
ng, sel
lingt hemer chandiset ocustomeranddi splayi
ngt hemer chandise
atr etai
lshop,t hesear et hefunctionsoff ashionmer chandiseratdiffer
entl evelofindust r
y.Theski ll
s
requirementoff ashionmer chandisingt uningwi t
hcur rentt r
endsi nmar ket,forecastingofupcomi ng
fashiont rends,technicalparamet erslikef abricandt rim detail
s,garmentqual it
y,decidingthesour cing
strategy,communi cati
on and coor dinati
on al ong wi t
h concer n peoplei nt he i ndust
ry. Fashi
on
mer chandi sert
akesdesi gnorsket chf rom desi gneranddev el
opsitinsuchawayt hati twi
llbemar ket
feasible,producti
onf easible,
andmeet scust omerdemands.
Str
uctureoffashi
onindust
ry:
Thestruct
ureoffashi
onindustr
yischangesfrom st
rat
egi
esadopt
edbyt
hebuy
ersf
rom di
ff
erentcount
ry.
Butthecommont r
endfoll
owedintheindust
ryisas.
Allov
ertheworldthisst
ruct
urei
sfoll
owed,someti
mesbuy
erdir
ect
lypl
acestheor
derwit
hexport
er.But
about60-70%oftotalbusi
nessoffashi
onproduct
sisr
unthr
oughthebuyi
nghouse.I
nallt
hisprocess
themerchandi
serplayst
heimport
antrol
e.
Needofmerchandi
sing:
Theneedofmerchandisi
ngi
nwhol
efashi
oni
ndust
ryi
ssummar
isedasf
oll
ows
Fr
om buy er sper spect ive:
Tof i
ndoutt hemar kett rend
Tomaket hef orecastofmar ket,i
nor dert odev elopthenewst yle
Pr oductdev el opmenti sdonebymer chandi ser
Dev el opmentofnewl inef ort henextseason
Li nepl ani sdev el opedbyt hemer chandi ser
Maket hemar ket i
ngcal endar
TomakeCommuni cat ionandcoor dinati
onwi thbuy inghouseandmanuf act
urermer chandi
seri
s
needed.
Fr
om buy inghouseper spect i
v e:
Tomaket hecoor di nat i
onwi ththevendor saswel lasbuy er
Fol lowupoft heexpor tor der.
Anal y sisofmar keti sdonebybuy inghousemer chandiser
Br ingt heor der st obuy i
nghouse
Cost i
ngi sdonebymer chandi ser
Fi l
lingt hedai lyr epor t
st hatbuy inghousedeal swi t
h
Fr
om manuf acturersper spect i
v e:
Thepr oduct i
onmer chandi serplayst hebr idgebet weent hemanuf act
uresandbuy er
Theneedofmer chandi serst artswhenenqui ryofbuy erscomesf ornewor der
Buy ercommuni cat esal lt hei nf
ormat i
ont ot hemer chandi ser
,whi lemerchandiserneedstoconver
t
thati nf ormat i
oni nt of ormatwhi chi sunder standablet oproductionexecut i
ves.
Fort he pr operor derf ollowupmer chandi seri sneeded
Thef abr icandt rimsconsumpt i
onandcost ingisdonebyt hemer chandiser.
Advantagesofmer chandi si
ng:
Mer chandi singJobi sv er ydemandi ng
Wel l pai ddesi gnat ion
Oppor t
uni t
yt ot rav el
Per sonal growt h
Asi ti samul t
ipleact i
vityj obdesi gnat ion,henceeasyt omov einrelat
edar ea.
Wi dev arieti
esofj oboppor tunit
iesar eav ailable.
Cont actwi tht hepeopl ef rom di f
ferentbackgr ound,cul t
ure,country,l
anguages.
Dev el opmentofsof tski lls.
Di
sadv ant agesofmer chandi sing:
Excessi vewor kl oad
Excessi vet r
av elling
Ant isoci alappr oach
Hugecompet it
ion
Rigidityi
nt r
ainingprogram
Longandl atewor ki
nghour s
Dif
fer
entfor msofmer chandi
sing:
Expor
tMer chandising
Expor
tmer chandisi
ngi st hebridgebet weenthebuy
erandthemanufact
urer
.Iti
st hebackboneof
appar
elexpor tindustry.Asthest ruct
ureofindust
ryi
srout
ingt
hrought
hebuyinghousehence,expor
t
merchandisingcanbedi vi
dedintwot ypes
Inexportproductionhouse
Inbuy i
nghouse
1.1Merchandisi
nginGar mentProduct
ion:
Ifthegarmentproducti
onhousei ssmallthenall
thejobofmer chandi
singisdonebyoneperson,butat
thesamet i
mei fi
tis bigproducti
onhousethenjobofmer chandiser
sisspecif
ied,
anddivi
ded accor
ding
tothefunct
ionmer chandiserper
form,
e.g.Marketi
ng,sour
cing,
sampl i
ng,pr
oductdev
elopment,pl
anni
ng,
etc.
Marketi
ngMerchandiser:
Themai nj
obofmar ket
ingmerchandiseristodot hemarketi
ngofthefactor
yinthemarketandgetthe
new buyer
sandt henew order
s.Onceor deri
sconf i
rmedfrom thebuy
er,thenmarket
ingmerchandi
ser
wil
lhandovert
heor derstot
hepr oducti
onmer chandi
serf
orthefurt
herf
ollowups.
Pr
oducti
onmerchandising:
Pr
oducti
on merchandisersarethefaceofgarmenti ndustr
y.Theynor mal
l
yr epresentthegarment
i
ndust
rytothebuy er
.Ther ol
eofproduct
ionmerchandiseri
sv er
ycruci
alasthesuccessofanyexport
or
derislar
gel
ydependsonper f
ormanceandcoordinat
ionski
llofpr
oducti
onmerchandiser
.Theroleof
pr
oducti
onmerchandisercanbesummar i
sedasf
ollows
Communi cati
onwi thbuy er
Coor dinationwi thinthepr oduct ion
Fol l
owupofdi fferentappr ovals
Pr oductdev elopment
Cost ing
Sour cingorpur chasingofr awmat eri
al
Pr eparati
onofBOM, TNAandt r
im card
Shi pmentschedul i
ng
Communi cati
onwi thfrei
ghtf orwarder
Sourci
ngmer chandiser :
Sourci
ngmer chandi serwor ksf ort hesour cingoff abr
icandtri
ms.Hewil
ltakecareofonlysourci
ng
specif
iedwor ki nthei ndustry
.I nbi ggeror ganizat
ionthiswor
kisdonebydiff
erentper
son,pr
oducti
on
merchandiserwi ll
giv eonlyspeci f i
cationsrelatedtofabr
icandt
ri
ms.
Sampli
ngmerchandiser:
Sampli
ngmerchandisertakescareofsampl i
ngonly;producti
onmer chandi
serprov
idesallt
hedetai
lsto
sampli
ngmerchandiser.Accor
dingtospecifi
cati
onsampl i
ngmer chandisermakessurethatsamplewil
l
besendtobuyerontimewi t
hcor r
ectrequi
rementsofbuyer.Therol
eofsampl i
ngmer chandi
seri
stotake
fol
l
owupofall sampli
ngaswel lastakecareforqual
it
yoft hesamples.
1.2Buy i
nghousemer chandising
Ther ol
eofbuy inghousemer chandiseri ssl
ight
lydiffer entfrom pr oduct
ionmer chandi
ser.Buyinghouse
i
sanagentwhowor kswi ththebuy erandmanuf act ur er/
exportert ofulf
ilt
heobl i
gati
onoft heexport
order.Buyi
nghousemer chandiserdi
rectlycommuni cat edwi thbuy er.Thefuncti
onofanybuy i
nghousei s
torepresenttheiroverseascust omer.Thewor kdonebybuy i
nghousei sdependsuponsi zeofbuy ing
house,v ol
umeshandl ed,servicesprovidedtobuy er.Pr imepur poseofmer chandiseri
st oensuret hat
deli
veryoftheor deri
sont i
me.Ther oleofbuy i
nghousecanbedescr i
bedas
1.
3.Vi sual merchandising
As av isual
mer chandiser ,
display desi
gneror
window dresser
i
t woul dbe
jobofv i
sualmerchandisert o
create ey e-
catching pr oduct displaysin shops and st or
es.
Visualmer chandiserisresponsible for
presentingpr oductsinawayt hatat t
ractscust
omers andmaxi mi ses
sal
es.Thiscoul dmeanany thi
ng
fr
om decor ati
ngast orei naseasonal
theme–l ikeChristmasorspr i
ng
sales
–t omaking sure
store’s
di
splay sfit
thecompany ’s
brandi mage.
Concl usion`
‘
Mer chandi sing’i sverywi det erminologyusedi nindustry
.Ther ol
eoft hemer chandiserisv ar
iesf r
om
stagesoft hef ashioni ndust
ryl i
kepr oduct
ion,buyinghouse,retai
landsel ls,visualmer chandiser.The
workofmer chandiserdy nami call
ychangesf rom or gani
zat
iont oor gani
zation.Insomeor ganizati
on
mer chandi serpl ayswi der ol
ewhi l
einsomeor ganizati
onrol
eofmer chandiserisv er
yspeci fi
c.Thej ob
profil
eofmer chandiseri salsochangi ngwi t
ht hegr owthofappar elindustrytodayi tbecomesmor e
compl icatedt hanprev i
ous.Ther equi
rementofski l
lsformerchandisi
ngchangesdr astical
lywithrespect
toor ganizat i
onandst ageoff ashionindustr
y.
1.3Mer chandi singconceptandpl anning
Mer chandi sepl anni ngi samet hodofsel ecting, managi ng,purchasi ng,display i
ng, andpricingt hepr oduct
sin
amannert hatbr ingsi nmax i
mum r eturnsoni nv est ment ,val
ueaddi ti
ont othebr andnamebysat isfyi
ngthe
consumerneedswhi leav oidi
ngt hecr eationofex cessi nv
ent ory.Mor eover,mer chandisepl anningi sabout
str
ivingt omak ether i
ghtpr oductav ail
abl e,att her ightti
me, i
nt her ightplace, int heri
ghtquant it
ies,andat
ther i
ghtpr ice.Youcanal somak euseofappr opr iat emerchandisei nventor ysof twareforst reaml i
ningyour
i
nv ent oryoper ati
ons. PlanningMer chandi secanr educemar k
downs, outofst ocks, andov erstockscenar i
os.
ThePr ocessofMer chandi si
ng-Howt oPl anMer chandi se
Everyi ndust rywi llhav eadi fferentwayofappr oacht omer chandi sepl anni ngt hatwi l
lsui ttheirspecifi
c
needs.Ret ai lindust ri
esl i
k eclothingwi l
lhav et of ocusont hesi ze,color,anddesi gnthatwi llbeindemand
andhowmanyoft hem t heywi l
lbesel l
ing.Incont r ast
,anonl inegr oceryst orewi llhavet ofocusonsel li
ng
dif
fer entt y
pesofedi bleitemsandwhatpeopl ewi ll needmor ei napar t
icul
arseason.
Whati smer chandi sei nventory?Mer chandi sei nv ent oryistheaccountgi v
enonabal ancesheett hatshows
thet otalamountpai df orallthepr oduct sst il
lint hequeuet osel l.Nev ert
heless, thereisst il
laf undament al
mer chandi singpr ocess,whi chi sfol l
owedbymostoft hecompani esandar oundwhi chtheyst r
ucturetheir
planofact i
on. Also,thest epsinmer chandi singplanningareeasyt olearnandf ol
low.
Thef ir
stt hingy ouneedt odoi sanal yset hepr eviousseasons’ salesdat aandr evenueofeachpr oductand
thebusi nessf oreachweekasawhol eal ongwi thmar k
etsur v
ey sandconsumerdemandsy oucanf orecast
demandf ort hecur rentseason.
Demandf orecast i
ngi sthepi ll
arar oundwhi cht hestrat
egyi scrafterbecause, basedont hi
s, t
hestock sar e
stuf fedup. For ecastinginv olv
est heant icipat i
onofhowacust omerwoul dbehav edur i
ngasal esseason.
Asal esf orecasti st hepr i
mar yst epi nf i
gur ingoutt heamountofi nv entoryisneededandatwhatt ime.I n
det ail,
theest imat esshoul dtellyouaboutt henumberoft hepr oduct sr equiredtopur chase,thesell
ingpr ice
oft hepr oduct s,andi fitisneededt oaddnewpr oductstothemer chandi seassor tment .
Most lyinsal esordemandf orecastpl anni ng,therear etwoappr oachesonei st op-downpl anningand
bot tom- uppl anning.I nt op-downpl anni ng,t heseni ormanagementf i
gur esoutt hedemandandsal espl an,
andt heni ti sgi vent ot hemer chandi singt eam.Ont heot herhand,bot tom- upplanningi sthatinwhi cht he
mi d-leveldepar tmentmanager sest imat et hedemand.Dat aderivedf rom bot happr oachesar ethenaddedt o
gett het otal demandf igures.
Foll
owt hesegi venpoi ntst of or ecastt hemer chandi ser equirement s
Anal yzingPastSal esDat a: Asment i
onedpr ev i
ousl y ,rev i
ewi ngt hesal esdat aofpastseasonsoft he
sameper iodandcompar ingt hem wi t
ht hecur r
entsal est rendscanbev eryhel pfult ocat cht hepat t
ernof
biasi nt hecust omer ’
schoi ces.
Anal yzingt heeconomi cst ateoft hemar ket :
Bev erysur et haty ouknow t hef inanci alcondi ti
onoft he
mar ketbecauser ecessi onscanaf fectt hespendi ngpat t
er noft heconsumer s.
Rev i
ewi ngt hesal espot ent ialoft hepr oduct :
Compar et hemar ketdemandoft hepr oductandcal culate
thepossi bilityoft hatpr oduct .
Resear cht hemar ketf ornewmar ketingst r
at egi esoft hecompet it
or s:
Mar ket ingst rat egyi sal socr iti
cal
apar tf r
om t hedemandf or ecast .Findouti ft her e’sanewwayy oucanmar kety ourpr oduct ,orar epeopl e
l
ooki ngf oranewpr oduct , ordoy ouneedt oi ntroduceanewmer chandi selinei nt hemar ket .
Accumul at ingt hedat aandcr eat i
ngt hef inalmer chandi sef or ecast :
Af t
ercar ry i
ngoutal ltheanal ysisand
calcul ations, theny oucancompi leallt hedat aandcomet oaf inalpr edicti
onf oreachpr oduct .And, only
theny ouaddmor ei nv ent or yt oy ourwar ehouse.
Decidi ngont heMer chandi seNeeds
Nowaf tery ouhav ef orecast eddemandandy ouk nowhowmuchy ouneedt opl anhowy ouar egoi ngt obuy
andmanaget hepr oduct ssot haty oucanpr ov i
det her ightpr oduct ,att her i
ghtt imeandi nt her i
ghtpl acet o
yourbel ov edcust omer .
Nowt herear est epsy ouneedt ot aketopl any ourmer chandi se.
(1)
Budget ing
(2)
Assor tmentPl an
Budget ingi st hef irstst ageofmer chandi sepl anni ngbecause,f irst,youneedt ok now how muchofy our
moneywi llbei nv est edorhowy oucanmi nimi z eit .
Thebudgetcompr isesf ivesect ions.
Thesal espl an –Pr oj ect ingt heamountofeachpr oductt hatwi l
lbesol dt hisseasonf rom eachr etai
l
outlet ,onl i
nepl at for m, ormar ketplaces.
Invent or ypl an–t hi swi llt elly ouhowmuchi nv ent or yy ouneedt ost ockt oachi ev ethedemand.
Thepl annedr educt i
ons –Thi si sabackup.I t’st her educt ioni napr oduct ’
squant i
tyi ncaset hepr oduct
doesnotper f orm.
Planni ngt hepur chasel ev els –Pl anningofhowmuchasi ngl epr oductwi llbepr ocur ed.
Deci dingongr ossmar gi n –t hedi f
ferencebet weent hesel li
ngpr iceandt heCOGS
Assor tmentPl anni ng
VanHer pendef inesassor tmentpl anningast hecombi nationofal lproduct smadeav ai
labl einast ore”anda
setofpr oduct sof f eredwi t
hi napr oductcat egor y .Thesepr oduct sf orm asetbecauset heyshar esi mi l
ar
physi cal char act erist ics.
Assor tmentPl anni ng i
saboutdeci dingt henumberofeachpr oductt hatwi l
lbeboughtt omak esur et he
demandi smet .Assor t
mentpl anningi sdonemaj or l
yt oensur et hatcust omer sar eallocat edpr oduct sina
balancedway .Thedet ailsofi nv entorylikecol or ,size, mat erials, brand, etc.arespeci f
ied.
Mer chandi seHi er ar chy :
Pr oduct sar ecl assi fi
edorar rangedi nawayt hatwoul dsui ttheconsumer ’sbuy ing
patter ns.Thi si scal ledamer chandi sehi erarchyi nwhi cht hepr oduct sl ikelytobepi ckedf ir
stormor ei n
quant ityar egr ouped,andt hepr oduct st hatar el essl ikel
yt obesol dar ek eptt oget her.Manyt imest he
gr oupi ngcangoont ocr eat e5- 6l ev els.
Whyy ouNeedt oPl any ourMer chandi se?
Ret ailer sofmoder nt imesmi ghtnotaskt hi
squest ionbecauset heyk nowhowv i
tal mer chandi sepl anni ngi s;
howev er ,fort hebegi nner sort heoneswhot hinkt hati tisnott hati mpor tant , her ear esomeoft her easons
whyy oushoul dpl any ourmer chandi se.
Mer chandi sepl anni ngcanhel py oust ocky ourwar ehousei nawayt hati ncr easest hei nv ent oryt urnov er
rat i
o.
Itdecr easesi nv ent orycar ryingcost sast her ei sl essunwant edi nv ent or yi nt hewar ehouseandhence
l
essl abor ,lessmai ntenancecost ,lessl osst hroughobsol escenceasmostoft hest ocki ssol d,less
depr eci ationofi nv ent ory, etc.
Br ingsv alueaddi tiont ot hecompanyasy ourcust omerv er yr arelygoesempt y-handedandhasenough
opt ionst ocompar epr oduct stomakeapur chase.
Sincey ouhav et her ightpr oduct ,int her i
ghtquant i
ties,att her ighttime, att her i
ghtpl ace, andatt her ight
sel li
ngpr ice,y oudon’ thav et opr ov i
demor edi scount st ogetr idofol di nv ent ory ,andt her ear ev eryf ew
outofst ocksi tuat ions.
Youdon’ thav et ogot hroughsi tuat i
onsofpani cwhi let r
y ingt omanagey ouri nv ent oryandmeett he
demand.
Pl anni ngmer chandi sesmar tl
yl eadst osmar tinv est menti ni nv entor yi.e.; yourmoneyi st i
edt oonl yt hose
st ockst hatwi ll gener at er ev enue.
Yourr ev enuesi ncr easeast her ear ef ewermar kdowns, andpr oduct sar eav ailabl ef orsal e.
Chal lengesi nMer chandi sePl anni ng
Mer chandi sepl anni ngi sn’taseasyasi tseemsonpaper .Ther ear eal otofdi l
emmasi nv ol
v edi nthis, andas
asmar tpl anner ,y ouneedt omak ecor rectdeci sionst ogetoutoft hosedi lemmas.
Mai ntai ningabal ancebet weenanonl ineandof fliner etailbusi ness
Yes, ret ailershav ingbusi nessbot honl i
neandof flinehav etodesi gnacour seofact i
onf orbot handensur e
thatt hei nv ent or yi sav ailabl ef orbot hpor tals.Under standingt heneedsofanonl inecust omerandof fl
ine
cust omeri st hek eybecausebot h, thought heywantaqual i
typr oduct ,hav eadi f f
er entappr oacht oshoppi ng.
Asf arasof fl
inei sconcer ned,
visual mer chandi sing playsav i
tal rol
einseal i
ngt hedeal .
Youneedt ohav eanOmnichannelappr oacht omak ei twor k,andt her efor ey oushoul dhav eagr eat
connect ionbet weenal lthest oresandt heirinv ent ory .Fort hat ,acent r
aliz edi nv ent orymanagementsy stem
canhel py out oaccumul ateal lthedat aononedesk topscr een.
Bl i
ndl ybel i
ev ingt hehi stor ical dat a
Mostbi gcompani esar ecur sedwi tht hisbecauset heyhav edat ai nabundance, andi t
’sst r
ai ghtforwar df ora
plannert ogetl osti nt hedet ailsoft hedat aandf orgett hecur rentsi t
uat ions.Ther ef ore, it’
sessent ialt otak e
thecur rentmar ketbehav i
ourser iousl yandamal gamat ethehi stor i
caldat awi t
ht hecur rentt rends.
Howmuchoft her ightpr oducti senough?
Thi si sal soabal anci ngactbecauseaf tery ouk nowt hatapr oducti sr ightf ort heconsumer s,youneedt o
figur eouthowmuchoft hatcor rectpr oducti senough.Thequant i
tyissi gni ficantbecausey oumi ghtt hink
thatt hemer chandi sewi l
lsel lsmoot hl y,butt her ei sal imitt oev erything,soy ouneedt ounder st andhow
muchy oushoul dst ockwi thoutov erst ock i
ng.Youcanuset heOTBf ormul ai .e.,opent obuyt omak esur e
youar ebuy i
ngi nacont rolledmanner .
Pl anni ngmer chandi sef ori nter nat ional mar kets
Itisv erymuchessent ialtounder standt hatt hepl ant hatwor k sf orthedomest icmar ketsmayf allf
latf ort he
i
nt ernat ionalmar ket,i ncludi ngt hechoi ceofmer chandi sebecauseoft hechangei ncul ture,geol ogical
demogr aphi cs, andweat her .
1.
4Dut
iesofMer
chandi
ser