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Chapter 14

Chapter 14. RETAIL MANAGEMENT: A STRATEGIC APPROACH. Developing Merchandise Plans. Class Agenda. Administrative Item Course Schedule and Final Exam date Retail Institutions Assignments

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Chapter 14

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  1. Chapter 14 RETAIL MANAGEMENT: A STRATEGIC APPROACH Developing Merchandise Plans

  2. Class Agenda • Administrative Item • Course Schedule and Final Exam date • Retail Institutions Assignments • Introduce merchandising philosophies and concepts in preparation for Build-A-Bear Workshop and SunRipe cases scheduled for next week • Administrative Item • Midterm results

  3. Merchandising Activities involved in acquiring particular goods and/or services and making them available at the places, times, and prices and in the quantities that enable a retailer to reach its goals.

  4. Merchandising Philosophy • Sets the guiding principles for all the merchandise decisions that a retailer makes • Should reflect: • Target market desires • Marketplace positioning • Retailer’s institutional type • Defined value chain • Supplier capabilities • Costs • Competitors • Product trends Does Gap’s strategic alliance with Diane von Furstenberg reflect all of these things?

  5. Scope of Responsibility Merchandising view • All buying and selling functions • Assortments • Advertising • Pricing • Point-of-sale displays • Employee utilization • Personal selling approaches Buying view • Buyers manage buying functions • Buying • Advertising • Pricing • In-store personnel manage other functions • Assortments • Point-of-sale displays • Employee utilization • Personal selling approaches

  6. Merchandising v. Store Management Career Tracks at Hbc

  7. Cross-merchandising Retailers carry complementary goods and services to encourage shoppers to buy more Two Merchandising Strategies Retailer adjusts shelf-space allocations to respond to customer and other differences among local markets Micromerchandising Is cross-merchandising different from scrambled merchandising?

  8. Figure 14.5 Considerations in Devising Merchandise Plans

  9. What is Category Management? A Retailer/Supplier process of managing categories as strategic business units, producing enhanced business results by focusing on consumer value • Category Management is a Process and involves a series of interrelated activities • Category Management is comprised of distinctly different supplier and retailer components and cannot be done alone by either • Category Management has been shown to lead to improved business results and improved relationships between trading partners

  10. Category Management Traditional Business Practices Retailer Develops Store-Level Marketing Plans Manufacturer Develops Marketing Plans and Programs for Brands Implementation Category Management Practices Retailer & Manufacturer Category Planning Implementation

  11. A New Way of Doing Business OLD NEW Category/Brand/SKU Management Consumer Focused Tactics Data-Based Decision Making Proactive Business Planning Collaborative Work Process Brand/SKU Management Retailer Focused Tactics Deal-Based Decision Making Reactive Business Planning Adversarial Work Process

  12. Figure 14.13 Applying Category Management

  13. Figure 14.4b Shelf Logic: Software for Category Management Planning

  14. Category Captains What is a Category Captain? an appointed lead supplier who carries out the category review and leads the process to deliver the plan for the total Category The Category Captain must: have a demonstrable knowledge of customer insight and market understanding take an objective approach to growing the overall category recognize the role of other suppliers in delivering the goal Non-captains?

  15. Merchandise Quality • The battle of the brands • Article Manufacturer (national) Private (dealeror store) Generic

  16. Private Brand TestMatch the Retailer with the Brand Name Why would a retailer (like LaSenza for example) opt to sell only private label products?

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