1 / 12

Buying Merchandise

Buying Merchandise. The Buyer’s Job. Determine the amount of money available to make purchases for a given period of time Determine merchandise for the target market Determine the best vendor/source Negotiate best terms and discounts Determine best time for delivery . Available Money.

colton
Download Presentation

Buying Merchandise

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. Buying Merchandise

  2. The Buyer’s Job • Determine the amount of money available to make purchases for a given period of time • Determine merchandise for the target market • Determine the best vendor/source • Negotiate best terms and discounts • Determine best time for delivery

  3. Available Money • Determined by merchandise plan • Open-To-Buy: amount of money that is available to purchase merchandise after other merchandise purchases have been subtracted • Planned Purchases - (merchandise received + merchandise ordered) = Open-to-Buy

  4. What Customers Want • Target Market Information • Sales Records • Customer Preferences • Customer Requests • Want Slip: form used to inform a buyer of a specific request form a customer for merchandise that the store or department does not carry

  5. What Customers Want • Shopping the Competition • Merchandise for sale • Merchandise categories • Quality comparison

  6. Vendor Selection • Vendor: a company from which the buyer purchases merchandise • Relationship • Products offered • Selection • Delivery • Terms

  7. Negotiating Terms and Discounts • Objective: to make a profit for a business • Dating Terms: date when bill has to be paid (2/10, net 30) • 2 = 2% discount • 10 = if bill is paid within 10 days of receipt • Net 30 = full amount due within 30 days of receipt • Shipping Terms: how the merchandise will get from the manufacturer to retailer • Who pays for the shipping? • Costly • Who owns merchandise while in transit • FOB: Free on Board

  8. FOB (Free on Board) • FOB Origin, Freight Collect: store pays shipping & owns merchandise while in transit • FOB Origin, Collect: Vendor pays shipping costs, store owns merchandise while in transit • FOB Destination, freight collect: store pays shipping, vendor owns merchandise • FOB Destination, freight prepaid: vendor pays shipping & owns merchandise while in transit

  9. Timing Merchandise Delivery • Arriving Too Early • Storage • Reallocation of Floor Sales Space and loss of sales • Arriving Too Late • Missed sales • Loss of Goodwill

  10. Types of Buying • Centralized: all buying for the chain is completed from one location • Advantage: Quantity Discounts • Disadvantage: Lack of Specialized to Target Mkt. • Decentralized: buying decisions made at the local store • Advantage: specialized to market’s needs • Disadvantage: loss of discounts

  11. Pricing Merchandise • Factors Affecting Price: • Cost of merchandise • Expense of getting it to the store • Retailer’s overhead • Desired return on investment

  12. Other Factors • Desired market share • Competition pricing • Customer acceptance • Planned markdowns

More Related