THE SIX MONTH OR ANNUAL PLAN THE MODEL STOCK THE OPEN-TO-BUY VENDOR EVALUATION TIMING THE PURCHASE

INVENTORY BUDGET GMM GENERAL MERCHANDISE MANAGER DMM BUYER

 Out

line that helps buyers meet merchandise needs of the department.

Prepared by
GMM Buyer Team

Prepared based on Past sales and external inputs.

Resident Buying officers or Market experts of fashion House( Whole sale market) Trade Paper (Fair child Publications) Fashion Magazines Fashion Colors, Fabrications, Styles and Directions to customers by media.

(Trade paper information + understanding customers exposure = Perfect six month Plan)

Assortment of merchandise in inventory to satisfy shoppers/customers Price Points Size distributions Styles Color choices Inputs Taken by buyer: Stores Department Manager, Sales associates

Whats missing the inventory? (What more is expected by the customer and what is not there!!) Whats not selling as expected? (Reasons for failure of some stocks planned) Competitors merchandise available at better price

Different taste of customers according to the geography

Socio Economic conditions

Demographic classifications

Staple Merchandise Model stock is not complicated Fashion Merchandise Model stock is complicated (Silhouette, colors) Wrong model stock: Reduced sales, Discount sales, Loss of customers

Open to Buy: The difference between merchandise needed and merchandise available. OTB = Merchandise needed Merchandise Available

Amount budgeted Merchandise on Hand(Carried from previous season) Merchandise Commitment ( Commitment made by the merchandiser that has not come into the store)

Status of Inventory Cancellation of Mark Downs Mark Ups Purchase planning If not planned properly Too little, sales may be lost Excess purchase, markdowns

GMM or DMMs approval for buying beyond approved budget

Stores depend on a Group of vendors for supply of inventories. No Guarantee that the line of products proposed by them are sellable always.

Vendor evaluation is based on Vendor Reports.

 Markdowns Stock

Turnover Maintained Markups Reorders of best sellers Promptness with reorders filled(i.e. issued to vendor) and received Vendors policy on returns

Distribution policy of the Vendors Advertising allowances Are they technologically sound(EDI) Will they accept style adjustments as per the retailers requirement

Place orders when delivery will be guaranteed. Timing of purchase is based on the type of retailers.

Classification Of Retailers
Traditional

ahead) Off-Price Merchants

retailers ( Plan an year

Major retailers: Whole line Departmental Stores, Specialized departmental stores, Specialty Chains Small stores Plan an year ahead. Fashion Retailers: Order early; they receive the first production run of the vendor before it reaches the market

Principle of working
Providing the merchandise at a low price Wait till the vendors reduce their cost of the product. Market specialist alert when the vendors reduce their price.

Opportunistic buying when price fall and when it matches their operations

Visiting the market for purchase by the buyer depends on

Type of the retailer Off-price retailers visit every week Traditional retailers visit when new product is introduced. Type of product Distance of the retail from the market