Category Sales Phasing Fashion Accessories - Case Study Example

Category Sales Phasing: Fashion Accessories 24 May 2007 Introduction The category sales phasing has to be done for the spring summer 2008 periodin mind. The category that is being planned is Fashion Accessories which includes Scarves, Lingerie, Swimwear, Sunglasses, Jewellery and Leather goods. Clearly, some of these accessories are worn more often during summers while others are not. The LFL sales plan has been prepared keeping this is mind and ensuring that a sustainable plan is in place. The category mixes for 2006 have been prepared keeping all merchandising aspects in mind and the sales of 2006 have been used to find out 2007 forecast according to the LFL sales plan. Category Sales Phasing Fashion Accessory Promotional Activity Period (Duration in Weeks) Spend (in million ) Sunglasses Fashion Shows, Exhibitions, Discounts, Various offers and schemes 10 10 During spring-summer time, sunglasses would account for huge spend budget. Hence they are allocated the maximum amount of sales plan. During summers the demand for sunglasses goes up and hence it is important that a large percentage of media spend is on promotional activity for this particular product. These promotional activities would include fashion shows, different offers and schemes such as 'point-of-purchase promotion', discounts etc. The media spend has been allotted keeping in mind that the promotional activity would be spread over a period of 10 weeks from mid May until the end of July. However, not all promotional activities would be carried out for so long. Such as fashion shows would be held about 2 times over the period. Fashion Accessory Promotional Activity Period (Duration in Weeks) Spend (in million ) Swimwear Fashion Shows, Discounts, Mannequin display, Various offers and schemes. 10 10 Summer time is associated with beaches. This is time of the year when people go for long holidaying trips to various beaches across the globe. Clearly, this is also that time of the year when the demand for swimwear rockets up. Hence it is important to have well-defined promotional strategies to match up to the market demands of the product. The various promotional schemes could be fashion shows, attractive mannequin displays, attractive schemes and offers such as discounts etc. The promotional activity would be carried out for a period of 10 weeks again which is from mid May up to end of July. This is because if people are planning for long holidays, they would mostly start buying somewhere in advance and hence mid of May is the optimum time to start the promotions of swimwear. Since summer time goes on for a good 2 and a half months, the promotional activity should be in full gear for the full of June and July, which is when the holidaymakers plan their visits to beaches. Fashion Accessory Promotional Activity Period (Duration in Weeks) Spend (in million ) Jewellery Fashion Shows, Exhibitions, Discounts, Mannequin display, Various offers and schemes. 6 7 Jewellery as a product does not really have a relatively high demand during any particular season and its sales depends mostly on occasions. Hence its promotional activities will not be targeted keeping in mind the spring-summer season, and rather the onset of any occasion or festival. The amount that has been allocated for the sales plan, 7 million, will be required for activities such as fashion shows, exhibitions, mannequin displays and other schemes and offers. The duration for which the promotional activity will be carried out is 6 weeks. Jewellery will not be much in demand during the summer, but in the spring season. Hence the promotions would take place from mid March up to the end of April. Fashion Accessory Promotional Activity Period (Duration in Weeks) Spend (in million ) Lingerie Fashion Shows, Discounts, Mannequin display, Various offers and schemes. 6 7 Unlike Jewellery, lingerie is a fashion accessory which is a must-have. Irrespective of the season, it continues to have a good demand and attractive promotional activities can really shoot up its sales. However, during summers, because of the extended holidays, the sale of lingerie also increases. Merchandisers should capitalize on this and create special offers and schemes such as discounts. Other activities such as fashion show, discounts, mannequin display etc can also boost up the sales of lingerie. The spend would be spread through the entire of June up to mid July as this is time when the summers and hence the holidaying would actually start. Fashion Accessory Promotional Activity Period (Duration in Weeks) Spend (in million ) Leather Goods Discounts, Various offers and schemes 4 5 Spring summer is not the season for leather goods. However, the merchandisers must ensure that they keep the demand for the product stable and give such attractive offers that they at least maintain the break-even sales for leather goods or at least do away with the left over stock of the previous year. Hence various offers and schemes such as discounts and sales would help in achieving these objectives. The promotional activity for leather goods should be done right in the begging of the spring season which is in the entire month of March. This is when the merchandisers should ensure that the left over stock of the previous month of leather goods has been sold. Fashion Accessory Promotional Activity Period (Duration in Weeks) Spend (in million ) Scarves Discounts, Various offers and schemes 4 3 Once again, scarves are a product that is not worn during the spring summer season and hence the promotional activity for the same would be directed at either maintaining a break-even sales or doing away with the left over stock. This is the reason why it's promotional activities, which include different offers and schemes such as discounts and sales, account for the least amount of total LFL sales plan. The promotional activities would be carried out as soon as the spring season starts which is in March and would take place through the entire of March which is enough time for the merchandisers to do away with the left over stock and be able to achieve break-even sales. LFL Sales Plan Fashion Accessory Spend (2006) (in million ) Percentage Mix (%) LFL sales growth (%) Forecast Mix(2007) (in million ) Sunglasses 10 23.8 3 10.3 Swimwear 10 23.8 3 10.3 Jewellery 7 16.6 1.5 7.105 Lingerie 7 16.6 2 7.14 Leather Goods 5 11.9 1 5.05 Scarves 3 7.14 1 3.03 TOTAL 42 100 42.925 According to this LFL sales plan, there is a good LFL sales growth in the Sunglasses and Swimwear category, a decent sales growth in the Jewellery and Lingerie category and a relatively small growth in Leather goods and Scraves category keeping in mind the promotional activities for the same. From this, the 2007 forecast mix comes up to 42.925 million, thereby recording growth of 2.2%. Bibliography 1. Kunz, G. (2005), Merchandising Theory: Principles and Practice, Fairchild Books 2. Jackson, T. and Shae, D. (2001), Mastering Buying and Merchandising, Palgrave 3. Elliot, F. and Rider J. (2003) Retail Buying Techniques, Management Books 4. Varley, R (2006) Reail Product Management, Routledge 5. Gowerck, H (2001) Fashion buying, Blackwell Science Read More