TEM-409: Textile & Apparel Merchandising

Introduction to Textile & Apparel Merchandising

Dr Md. Syduzzaman
Associate Professor
Bangladesh University of Textiles
Email: [email protected]

Merchandising
• The activity of trying to sell goods or services by advertising them or displaying
them attractively.

• According to American Marketing Association, merchandising encompasses

"planning involved in marketing the right merchandise or service at the right
place, at the right time, in the right quantities, and at the right price.”

• The planning and promotion of sales by presenting a product to the right market at
the proper time, by carrying out organized, skilful advertising, using attractive
displays, etc.

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MERCHANDISING
• The process of identifying and understanding what target customers want and
providing their desired textile products to them in a certain price and lead-time by
making a communication bridge between the customer and the company.

So merchandising process involve of at least three parties:

1. Company: who offering product to the customer.
2. Customer: who is targeted by company with the help of merchandiser?
3. Merchandiser: merchandiser places his position between the above two
parties.

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W HAT IS M ERCHANDISING IN PRACTICE?

Merchandising is executing an order from receiving to shipment through proper

following-up the in-between processes.

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Departmental structures in merchandising
• Merchandising can be structured in numerous ways but more commonly, it is structured
on the basis of -
1. Customers
2. Products
3. Geography

On Basis of Customers:
Merchandisers are supposed to retain the customers and they are their representatives, so the
division based on customers is very logical from this point of view.
• Merchandiser A: taking care of “IKEA”
• Merchandiser B: Taking care of “WALMART”
• Merchandiser C: Taking care of “LI &FUNGs”
• Merchandiser D: Taking care of “TESCO”
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On Basis of Customers

Marketing & merchandising

manager

Merchandiser for Merchandiser for Merchandiser for Merchandiser for

Customer A (e.g., Customer B (e.g., Customer C (e.g., Customer D (e.g.,
H&M) GAP) ZARA) LEVI’S)

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On basis of products

Marketing & merchandising

manager

Merchandiser for
Merchandiser for Yarn Merchandiser for Fabric
Production

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On basis of Geography

Marketing & merchandising

manager

Merchandiser for Merchandiser for Merchandiser for Merchandiser for

Europe buyer Middle-east buyer USA buyer UK buyer

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 M ERCHANDISING FUNCTIONS

• Study of fashion trend and fashion forecast in association with fashion designer;
• Studying potential target customer;
• Sourcing information about the customer and his profile;
• Sourcing information about the product, its categories, styles, specifications,
assortments, size details etc. ;
• Sourcing foreign buyer;
• Negotiating orders, cost calculation, pricing, securing orders through master LC;
• Sourcing fabrics, trims and accessories;

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M ERCHANDISING FUNCTIONS
• Placing order for the fabrics, trims and accessories materials and making regular
follow-up;
• Getting samples made, making costing and pricing of the same;
• Rectifying samples if necessary;
• Completing the whole sampling procedure as per customer requirement;
• Getting buyer approval of the sample;
• Estimating lead time;
• Production and shipment planning;
• Keeping track of raw material arrival, production cycle, and organizing
inspections;

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M ERCHANDISING FUNCTIONS
• Monitoring production and product quality;
• Making regular liaison with the customer and keeping him update on order &
production status;
• Follow up of customer instruction in respect of packing and packaging;
• Arranging product delivery on time;
• Follow up with the customer in respect of shipment and informing him shipment
details;
• Coordinate with shipping/ export department;
• Arranging payment against export order;
• Quick response follow up in respect of any of the buyer’s query.

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ROLE AND RESPONSIBILITY OF M ERCHANDISER

• Securing order, sourcing materials and constant follow-up with the customer;
• Coordinate with all the concerned departments of manufacturing factory, supplier
organization and the buyer.
• Needs to cut a balance between quality, lead time, delivery schedule and price of
the merchandise;
• Organize the purchase of materials, follow-up of production, costing, quality &
delivery schedule under tight deadlines.

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 LEAD TIME

• The time between the initiation (starting) and completion (ending) of a

Process/Production process.

• Lead time is the amount of time that elapses between when a process starts and
its completion. Lead time is examined closely in manufacturing, supply chain
management and project management, as companies want to reduce the amount
of time it takes to deliver products to the market.

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Lead time for AOP Knit Fabrics

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Lead time for Solid dyed knit fabrics

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Lead time for Yarn dyed knit fabrics

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 TIME AND ACTION (TNA) CALENDAR

• TNA: Normally merchandisers prepare a plan of the order in a spreadsheet by

listing down the key processes in first column and planned date of action for each
process in the next column. This planning sheet is popularly known as time and
action calendar (TNA). Once TNA calendar is made, then it can be easy for
merchandiser list down their daily 'to do list' and taking it one by one.

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IMPORTANCE OF TNA

▪ It helps to streamline the pre-production activities.

▪ Easy understanding of order processing.
▪ Clear understanding of timelines given by buyer.
▪ It gives the clear idea about the minor or sub activities that need to perform during order processing
at different level.
▪ TNA gives the idea about the status of running order and talks about delay or deviation, if any
▪ TNA gives the dates at which raw material need to be sourced, in a way it helps to optimize the
inventory.
▪ TNA also reduces the risk of delivery delay.

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Factors to be considered while preparing

TNA
❖Production capacity of plant • Fabric and trims manufacturing
❖Style type of merchandise complications
❖Festivals of manufacturing country • Buffer required from each department
❖Holidays • Political stability of the country
❖Shipment details • Flexibility of freight forwarder
❖Festivals of country from where raw • Response time from buyer at different
material is imported stages
❖Logistics facilities • Lead times of various activities like
L/C payment, custom clearance, etc
❖Lead time estimated by buyer
• Cut off dates for shipments
❖Style complications

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FLOW CHART OF M ERCHANDISING ACTIVITIES

Marketing

Buyer Request

Pricing-costing

Order Receipt & confirmation

Order execution through coordinationg

following steps as per TNA

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 FLOW CHART OF M ERCHANDISING ACTIVITIES

Sampling Fabric Trims/Accessories

• Development sample • Receive color standards • Supplier sourcing

✓sample preparation and send • L/D or Y/D booking • Supplier selection
to buyer for approval
• L/D or Y/D preparation • Develop trims/accessories
• Fit sample
✓sample preparation and send
and send to buyer for • Trims/accessories
approval preparation and send to
to buyer for approval
• PP sample • Fabric production buyer for approval
✓sample preparation and send • Fabric quality send to • Price fixing
to buyer for approval buyer for approval • Trims/accessories booking
• Size-set sample • Fabric / Yarn dyeing • In-house trims/accessories
✓sample preparation and send booking
to buyer for approval • 1st Bulk dyed fabric send
• Production sample to buyer for shade
✓sample preparation and send approval
to buyer for approval. • continue dyeing
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FLOW CHART OF MERCHANDISING ACTIVITIES

Start Production

Arrange Inspection after

Production

Vessel Booking (about 15 days

prior to inspection)

Export documentation & logistics

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COLOR STANDARDS

• Color std. may be received by two ways-

1. Color swatch,
2. Pantone no. (TCX, TPX from color palette)

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SOME M ERCHANDISING BOOKING FORMATS

• L/D or Y/D booking:

Booking date: 9/6/2014
Delivery date: 9/9/2014

Fabric Quality
style# Factory ref. no. Fibre composition construction color name color std. comments
weight /Finish
1 100% cotton 180GSM Regular S/J Sweet Lilac as swatch L/D or Y/D booking
MGK7022 2013/78 2 100% cotton 180GSM Regular S/J Baby Pink as swatch L/D or Y/D booking
3 100% cotton 180GSM Regular S/J Deep Blue as swatch L/D or Y/D booking

name of merchandiser name of lab manager

Issued By Received by

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 SAMPLING

• Sample: A few item or goods taken from a large number of similar goods are
called sample.

• Sampling: Sampling is the most technical feature of the merchandiser’s job. This
involves developing new products or taking some existing products to the new
customer to meet the customer demands.

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SAMPLING PROCESS
Getting Buyers
query

1. Getting buyer requirement: On reception of the request

Sample
from the buyer, merchandiser evaluates the request. preparation
–Clarify the sample specifications with the help of R&D
people.
Evaluating Results
–Checking possibility:
•If not possible, buyer should be informed instantly. If
•If possible, its completion and dispatch date is to be ok
Packing and
confirmed to the buyer ASAP keeping in view all dispatch
processes time.
Buyer’s feedback

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SAMPLING PROCESS
2. Sample Preparation: After doing the necessary calculations, merchandiser first
checks whether such sample in stocks or not?
–In case of sample already present in finished stocks in the right quantity and
quality, then he can inform the buyer about the dispatch date in this regards
–In case, Merchandiser does not have any sample available, he will forward the
sample request (sample booking) to the relevant department.

3. Evaluating results: merchandiser gets the results from the Quality Control lab
and compares it with the standards specified by the buyers. If the sample results are
consistent with the desired results, then it can be sent to the buyer.

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SAMPLING PROCESS

4. Sample packing and dispatch: the sample is properly packed for its safe arrival
at the destination. For the sample dispatch, the merchandiser sends the sample via
courier and puts complete detail along- with the sample for buyer reference.
5. Seeking buyer’s comments: Once the sample reaches the buyer, merchandiser
gets the comments from the buyer and keeps records of it.
–If sample is approved, then he go for bulk production or next processes.
–If rejected , requires rework according to buyer comments.

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 TYPES OF SAMPLES

▪ Prototype sample
▪ Fit sample
▪ Size-Set sample
▪ Salesman / Marketing /Showroom sample
▪ Pre- production sample: (PP sample)
▪ Approved samples
▪ Production Samples
▪ GPT sample (Garment Performance Test)
▪ Photo Samples
▪ Counter Samples

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TYPES OF SAMPLES

• Prototype samples: These are samples developed during the preliminary stages of
product development. They are made by similar but not always exact fabrics &
trims. But must be made as per buyer sketch, specification sheet.
• Size-Set Samples: A sample of each size is required by the buyer after giving
comments on “ Prototype Samples”. Size-Set samples are requested to check the
accuracy of each size pattern.

• Fit sample: Fit sample is made and sent to conform the fit of the garment on live
models or on dummy and for approval of construction details.

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TYPES OF SAMPLES

• Salesman / Marketing /Showroom sample: These are the samples used by the
buyer for promotion or sale of their product. It is a special order from buyer. These
are required in exact fabrics, shades and accessories. More quantities are required
in this case and payments are made by the customer.
• Pre- production sample (PP sample): Must be in actual fabrics, trims and
accessories. Bulk fabric cannot be cut until these samples are approved by the
buyer.
• Approved samples: Upon approval of the pre-production samples by the buyer,
they will be sealed and tagged with comments if necessary. The approved pre-
production samples is called approved samples.

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TYPES OF SAMPLES

• Production Samples: Representative samples taken from a production line on

random basis by buyer’s representative is called production sample. A production
samples approved and accepted by buyer may represent shipment samples.
• GPT sample (Garment Performance Test): The main purpose of GPT is to
perform the physical and chemical testing on garment to ensure the performance
of the garment. The tests done on garments are: Shrinkage, Color Fastness, Seam
performance etc. Garments for GPT sample can be done along with Size Set
sample. Normally, GPT Sample is sent to 3rd party inspection and results are sent
to both factory as well as buyer.
• Photo Samples: These samples are photographed for making brochures, catalogs,
etc for distribution to stores and for end-use.

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 TYPES OF SAMPLES

• Counter Samples: Sometimes required approved samples in different

departments but there is only one approved samples. So, merchandiser can
reproduce a number of samples against the available approved samples.

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REQUIREMENT OF SAMPLE SUBMISSION

Raw materials
Sample type Color
(Fabrics + trims-accessories)
Development sample Any color Closest available
Fit sample Any color Closest available
Preproduction sample Actual color All actuals
Testing sample Actual color All actuals
Size-set sample Any color Closest available
Salesman sample Requested color All actuals
Production sample Actual color All actuals
Shipment sample Actual color All actuals

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SAMPLING DOCUMENTS

• There are some reports along-with the sample to be sent to the customer.

A. Covering letter
B. Specification sheet
C. Sample tag

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Sampling Documents
• Covering letter: In covering letter, Merchandiser mentions the below details:
✓ The name of company which asks the sample
✓ Contact person
✓ Phone no of destination
✓ The brief description of the sample
✓ The weight and quantity of sample

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 Sampling Documents
• Specification sheet: In specification sheet, Merchandiser mentions the technical
aspects of the sample with quality lab results. Example- Knitted Garments T-Shirt:
✓ GSM of Fabric
✓ Fabric Type
✓ Half chest
✓ Garments length
✓ Sleeve length
✓ Armhole
✓ Shoulder with etc.

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Sampling Documents
• Sample Tag: The sample Hang-tag is attached to the fabric/garments. It can
contain the following information:
✓ Sample Number
✓ Garment style #
✓ Composition
✓ Fabric/Garments type
✓ Shade
✓ GSM
✓ Price

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Qualities of a Merchandiser
• Good knowledge about fiber, yarn, fabric, dyeing, printing, finishing, dyes, color fastness,
garments production, etc.
• Clear conception of the usual potential quality problems in the garments manufacturing.
• Good knowledge of the usual raw materials inspection systems & garments inspection
system
• Knowledge of the quota system used in each of the production countries, duty rates,
custom regulation, shipping and banking documentation etc.
• Right consumption knowledge of various goods
• Costing knowledge of raw materials
• Order getting ability
• Sincere& responsible
• Hard worker
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Qualities of a Merchandiser (contd…..)

• Communication Skills (Verbal, Written, Listening)
• Managerial Skills (Technical, Human, Conceptual)
• Well-Groomed Personality
• Accessibility, Available and Mobility
• Politeness & Tolerance
• Coordination and Follow-ups
First and foremost, you’ll need to have a passion for retail. Employers will look for
commercial awareness, numeracy and the ability to think logically, and you will need to be
good at quickly identifying problems and recommending solutions. It will help if you have
experience of working with customers and experience working in a retail environment will
set you ahead of the competition.

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 Scope of Merchandising

Buying
Houses/
Manufacturing Liaison
Brands Companies offices/Trading
Houses

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Scope of Merchandising
(contd….)
• Brands: Merchandising doing all sorts of marketing research, promotions, fashion
designing, selecting new fabrics, garments styles and shades for the upcoming
seasons.
• Example: Adidas, Benetton, Calvin Klein, Esprit, Hugo Boss, J. Crew, Izod, Levi's, Lee etc.

• Manufacturing companies: Merchandisers are usually involved in the

completion of sampling, price negotiations and then following-up of production.
They liaise with brands directly or with their liaison office/buying house in order
to get their work done.

• Buying House/Liaison offices: Merchandisers play the role of Middle-men

between the above two situations and make a communication bridge. Their
purpose is to get the work done from manufacturers as per their customer’s
requirement.

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Order Negotiation
• Orders that have been sent to factories will be negotiated for price, delivery, quota and
quality etc. The order negotiation between the buyer and the manufacturer is not always
an easy task. The buyers are always trying to get this garments made at very low prices
whilst the manufacturers are hoping they will get at least 2 per cent more than what they
got last time for a similar style.
• The buyer always has a target price for the merchandise he hopes to buy. He has already
finished his homework and fully aware of the market price for the particular type of
garment. Therefore, he will do his best to buy the garments bellow his target price or for
his target price. We should not forget the globe is full of manufacturers and suppliers. The
buyer will certainly move to another manufacturer or country if he fails to buy at his
price.

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Order Negotiation
• On the other hand, the manufacturers will promise the best quality and prompt delivery
to convince the buyers to pay extra dollar or two for his merchandise. It is rather difficult
to convince a buyer to pay more than his target price, but it may be possible to do so if the
company has a good relationship with the buyer or if the company has a very good
reputation for excellent performance. In other words a good image should do the trick.
• Buying offices or their representatives should not consult companies operating at
very high CMT to do very low priced merchandise. Therefore the buying offices
not only should have knowledge on company’s performance but also their average
CMT prices.

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 Order Negotiation
• Another important aspect in the order negotiation is to know the fairly accurate
cost of making the garment. Most factories do this in a hurry and invariably arrive
at out of focus cost. This situation will cause frustration to both parties during an
order negotiation. The buyers are generally more conversant with the costing and
would be able to judge almost immediately the manufacturer’s operations if the
price quoted is very much different from his target price,
• If the quoted price is higher it may be due to
1. Higher overheads in the factory
2. Lower productivity in the factory
3. Higher mark-up (the amount added by a seller to the cost of a commodity to cover expenses
and profit in fixing the selling price.)
4. Raw material cost at high prices
5. Wrong consumption etc.

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Order Negotiation
• However, the Buyer may not be that dissatisfied if the price quoted is little higher
than his expected price. We might think that the price would be able to bring it
down through negotiations. He might offer his help to improve productivity
consumption and in the purchase of raw material at very competitive prices.
• If the quoted price is significantly low, the buyer might think the factory is not
capable of manufacturing his goods for his satisfaction. Low price would reflect
bad on the factory rather that securing he order. It looks rather funny, because we
are in era where prices are at rock-bottom but still there is a minimum price which
is offered by the buyer. Anything below means poor quality merchandise.
• Therefore, it is paramount importance to be at least 80 percent accurate - the
costing of a garment. It must also be remembered that the buyer will not buy a
particular garment at one price from two different companies. The successful
company will be offered the contract to manufacture.

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Thank you

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