Fashion Buying and Merchandising - Essay Example

Fashion Buying and Merchandising Table of contents. page Aim…………………………………………………………………………………..2 Introduction…………………………………………………………………………2 Fashion Buying and Merchandising team……………………………………….2 Buying Cycle………………………………………………………………………..4 The objective of the buying cycle and the implementation…………….5 Defining the organizational requirement…………………………………6 Selecting potential vendors for evaluating the options…………………6 Determining the terms and condition……………………………………..6 Final selection of the vendor and the vendor response and taking final decision…………………………………………....7 Merchandise Planning and Budgets………………………………………………7 Conclusion……………………………………………………………………………10 Appendix………………………………………………………………………………10 Bibliography/ referencing …………………………………………………………..12 The PPD Reflective Summary…………………………………………………….13 Fashion Buying and Merchandising Aim: Merchandising and the buying process has become one of the main functions for any ongoing retailing business. This is very important to analyze the most advanced merchandising processes and the proper buying cycles for the retailers. The main Aim is to create a perfect picture of the merchandising and buying office operation. Introduction: The fashion industry and the retailing have shown a great endeavor towards the development of the merchandising process. Most of the retailers are coming up with new advanced methods of merchandising process to grab a sustainable position in this competitive market. However, for any retailer it is very important to have a systematic buying and merchandising operation. Fashion Buying and Merchandising team: In the fashion industry the fashion retail buyers play an important role. There are many important factors like supplier’s selection and product decision. The most important fact to be noticed is the shift of the retailers from the purely operational background to more strategic background. According to Douglas (2009) the merchandising is the fundamental factor for all of those commercial activities which have distribution attached with it. The fashion wears for the kids have become a new trend in the market. According to the Key Note Childrenswear market report (2009) the UK children’s wear market was valued at 5.29 billion pound in 2008 The primary responsibilities of the buying and merchandising team are identifying the vendor, evaluating the best vendor, negotiation, and placing the order. In the retail industry the fashion and merchandising go parallel. According to Packard et al (1983) the primary role of the buyer’s team is the proper selection of the merchandise to ensure the availability of the new stocks in the store. According to Jackson T, and Shaw D. (2006) the merchandising and the buying team should identify the main responsibilities to add some values to the shop and the main responsibilities are one: pre-selecting and editing product range, two: negotiating value for money price, three: breaking down bulk orders, four: holding stock, five: providing product support, service and refunds and six: providing the proper consumer credit. In case of the front end strategic decision the merchandising team has low profile involvements. According to Fernie et al (2003) the merchandising team will have very little responsibility towards the space management decisions at the strategic level. However, the merchandising team is closely related with the tactical space management decisions. From the above discussion it is very clear that the main job of the merchandising team is to coordinate properly among three entities and they are store, warehouse and vendor to maintain the optimal stock in hand. Buying Merchandising 1. Related to ordering products. 2. Coordinating the purchasing with vendors. 3. Writing orders 4. Handling special orders. 5. Buying is a process of purchasing new products for the inventory. 1. Merchandising is a product selection for the buying. 2. Merchandising relates with the store. 3. It is a controlled plan for selecting proper materials for the store. 4. It is a closely related function to buying process. 5. Merchandising is a word mostly used in the fashion industry. Buying Cycle: The diagram of buying cycle is given bellow. According to Goworek (2007) the traditional fashion industry is splits into two main seasons, and they are the spring/ summer season, that is basically February to July and the autumn/ winter season which is from August to winter. The buying cycle considered as one of the main event in these two seasons. The continuous injection of the new products is very much important. Monthly introduction of new products is very much important. The adaptation of the proper buying cycle is one of the most important factors for most of the retailers and the fashion goods seller. A buying cycle has multidimensional cyclic process which can be daily, weekly, month or sometimes yearly. The decision related to the buying cycle is one of the most valid decisions to be taken by the organization. According to Buchanan (2008) the proper buying cycle has many stages involved in it. And the steps are given bellow. 1. The objective of the buying cycle and the implementation: The buying portfolio should be maintained with the suppliers. Sometimes they go with exclusive vendors for some specific products and sometimes they go with multi-vendor supplier model, where they buy same product from different vendors. The implementation of the proper buying cycle is very much important. Supplier selection is one of the main jobs to be done in this level. The important of the buying cycle is analyzing the implementation of the calculative buying process. 2. Defining the organizational requirement: Organization needs should define the requirements of the products to be bought. The previous sales figure of the specific product can be helpful to calculate the requirements according to the market demand. In this level the new product requirements play a vital role. Before going for the final selection process for the vendors the merchandising team should identify the new trend in the market and according to that the buyer’s team should have the list of new clothes to be bought. And at the same time the list of vendors should be ready. 3. Selecting potential vendors for evaluating the options: Selection of the vendors is one of the most important decisions to be taken by the organization. The formal methods of communicating with the vendor may me RFI (request for information), RFP (request for proposal), and ITT (invitation to tender). All the communication methods should be applied to communicate with all the vendors for the final selection. 4. Determining the terms and condition: Terms and condition for the final contract with the vendors is very much important. In this stage the organization would determine the duration of the contract, the price coefficients and delivery methods and the payment terms. 5. Final selection of the vendor and the vendor response and taking final decision: This is one of the final stages of the buying cycle when the organization selects the vendor and the vendor gives its final proposal for the acceptance. These are the normal steps to be followed by most of the retailers. There are many things to be taken care of while selecting the vendor. The pricing is obviously one of the important factors but timely delivery of the product is also very much important. As the fashion is very much time specific and a particular style stays for very short span of time particularly for the girls. Mainly during the festival times like Halloween, Christmas etc most of the young girls go for occasional dressings. So, if the products are not delivered within the time limit then the retailer may incur huge loss due to the growing inventory cost. Merchandise Planning and Budgets: A proper merchandising planning and budgeting should have many parts in it and some of the most important parts are purchasing plan, customer satisfaction plan, core plan, vendors, stores and chains. The proper connections are shown bellow in the picture. According to the above diagram there are three main stages are there in the proper merchandise planning and they are Growth related plans, develop related plans and the plans for the maturity level. According to Sabri and Shaikh (2010) the main objective of the merchandising planning is to balance the demand and supply profitability. If the supply exceeds the demand then it leads to the excess inventory and that lead to the excess inventory cost. A proper merchandising planning provides complete capabilities for the merchandising process, space planning, performance analysis, financial planning, assortments planning, allocation and more. Pricing of the products is also very much important for the proper merchandising plan. Selection of the proper product line is another important job to be done. For an example most of the multi-branded departmental stores have specific clothing line for everyone. The main lines are, top, skirts, leggings, jeans, party wear, sportswear, dancewear, shoes, caps sunglasses and many more for girls and Suits, Shirt, Trousers, Jeans and casual wear for men. A proper merchandising budget should have the thorough study about the market trend, future demand, inventory cost and a proper supply chain management system to provide the perfect figures for the budgetary prediction. According to the Cant (2005) a proper merchandise budget are very important to determine how much the retailer should invest in merchandise during the given time. The new trend of the children wears are booming very fast in the market and it can be seen that all of the departmental stores are having the kid’s section. So during the prediction of the merchandising budget the kid’s clothing merchandising should not be forgotten. A genuine merchandising budget is the financial plan for managing the product inventory investment. Different stores have their different merchandising budget depending upon their USP (Unique selling Proposition), some have USP based on Low price, some have it on quality and variety, etc. There is another very important factor to be taken care of and that is the Key Performance Indicator (KPI). Merchandising is a very critical function for the fashion retailers. Most of the retailers establish the key performance indicators. According to Ranchhod (2004) the KPI cover sales, stock intake phase, marginal sales data, stock-turn, mark-down and critical stock maintaining . To maximize the profit and sales the key performance indicators play a very vital role. Mentoring trading and seasonal sales history play a very important role. Conclusion: From this study is has been come to the conclusion that merchandising is one of the most important factor for most of the retailers. And a proper merchandising process can lead to profitability while a bad one can lead to the loss of market share and brand image. The merchandising and buying team play an important role in the selection of the vendors. The merchandising team has to be very much selective as it is a highly competitive market. The innovations like dancing wear, sportswear play a very vital role in the fashion retailing. However, for a proper planning the SWOT analysis is very much important. And the comparative study related to store locations and the design layouts are very much important to have a sustainable business in the UK market. Appendix I: 1. New Trend, the Children wears market: According to the Key Note Childrenswear market report (2009) the UK children’s wear market was valued at 5.29 billion pound in 2008, and the major players were Primark, Next, ASDA, Tesco, Debenhams, Sainsbury’s etc. 2. The Importance of the advanced buying process: Most of the retailers like Primark, Next, ASDA, Tesco, Debenhams, Sainsbury’s and other retailers are coming up with new advanced methods of merchandising to sustain in this competitive market. Fashion clothing for kids have become the new trend in the market 3. Big retailers are regaining the market: The growth of clothing and accessory sales is very much visible in the super markets and the sales of the clothes for kids mainly for the girls in branded stores like ASDA, Tesco, Primark, Next and Sainsbury’s is growing fast in the UK market for the cheap price tag and variety of brands. 4. Merchandising as the fundamental factor: According to Douglas (2009) the merchandising is the fundamental factor for all of those commercial activities which have distribution attached with it. It is true that Wal-Mart is pioneered in inventory control, pricing and supply chain management system. However, according to Conklin (2006) the merchandising team and the team of managers of ASDA helped the Wal-Mart to regain the market share of their falling business in Germany with proper merchandising technique. 5. Merchandising budgeting and pricing: According to Gray (2000) due to the price war the Wal-Mart bought ASDA and slashed their price to give the Wal-Mart expert pricing to the products of the Wal-Mart. 6. The merchandising budget depends on the previous year’s sales figure, for an example according to the International textiles (2005) the ASDA was famous for the four pound jeans which they sold two million pairs in just one year. So, the budget of the 4 pond jeans would be very much different than any other clothing as the demand was very high in the market. References. Buchanan M (2008), “Profitable Buying Strategies: How to Cut Procurement Costs and Buy Your Way to Higher Profits”. London: Kogan Page Publishers. Cant (2005). “Introduction to Retailing”. Claremont: Juta and Company Ltd. Conklin D W. (2006). “Cases in the environment of business: international perspectives”. California: SAGE. Douglas A W (2009) “Merchandising”. South Carolina: BiblioBazaar, LLC. ` Fernie J, Moore C, and Fernie S. (2003). “Principles of retailing”. Massachusetts: Butterworth-Heinemann. Goworek H. “Fashion buying”. New Jersey: Wiley-Blackwell, 2007 Gray T (2000) “Marketing” New Hampshire: Heinemann. International textiles (2005), “International textiles, Issues 843-846”. Indiana: International textiles. Jackson T, and Shaw D. (2006). “The fashion handbook”. London: Routledge. Packard S, Winters A A and Axelrod N. (1983). "Fashion buying & merchandising" New York: Fairchild Publications. Ranchhod A (2004). “Strategic Marketing in Practice”. Massachusetts: Elsevier. Sabri E H, and Shaikh S N. (2010). “Lean and Agile Value Chain Management: A Guide to the Next Level of Improvement”. Florida: J. Ross Publishing. Key note childrenswear market. Available at: http://www.keynote.co.uk/market- intelligence/view/product/10305/childrenswear?utm_source=kn.reports.browse . accessed on 3 december 2010. "Process maturity model" available at: http://trisynergence.com/Process.html. accessed on 3 December 2010. The PPD Reflective Summary. Personal and Professional Development, is the most important part of any educational course. The academic remarks will fetch good marks in the exams but, in the professional field the personal and professional development is very much important. The proper combination of good academics and the PPD have helped me out to understand the real picture of the corporate world. The last s study was the most amazing experience I have ever got. I have learnt many things within this time which would help me out in my near future to excel in the corporate field. From the project specification I can say that I have understood the process of buying and merchandising of the fashion retailers from primary sources like books, journals and market reports. It has given me the clear view of the competitive advantages of the different retail stores in the UK. I have learnt to be more specific and professional through the project. Corporate on-job projects need personal and professional development training, because the fresher are not accustomed with the corporate world. And each and every organization has their own scale of professionalism and expectations from the employees. For any graduate the on-job projects are successful while they get confident about their personal and professional development during the projects. During my study period I have rediscovered myself as a corporate identity. I have realized many things during this time and the main understanding and developments are given bellow. The meaning of success: Throughout the study I have realized that reaching the personal goal with the help of professional experience can be treated as the success. Same way in this case the meaning of success has been found with the proper blend of self belief, potentiality and values. The hard work has shown me the way to the success. I have realized the success by talking to many fellow researchers. By analyzing the research findings like real time buying process, merchandising office model and many other professional factors. Self belief: The confidence is a very important factor for any job to be done successfully. I gained the self belief by executing many work in this project. However, I am bit weak in presenting corporate presentation but I am still in the learning phase and gaining self continence have understood my own potential through this study. It has also taught me how to respect the others potentialities. I have realized that I can learn many things from my other collogue. I have learnt to give more productive presentation with the help of other people. This project has shown me the strength of the corporate harmony. Values: Personal values, professional values, ethical values and the ability to respect the values of the fellow employees are very much important. The particular course taught me to respect what other think, how they feel and how an individual should act toward the values of the others. Confidence in research work: This paper has helped me out to learn how to find the proper resources. This particular paper has helped me to go through many books related to the fashion buying and merchandising. Now I am confident enough to find out suitable references for any specific paper. Moreover I can say that this was a complete lesson for me, and it has given me the confidence to be a successful corporate entity in the fashion industry or in any other industries. Read More