1. Retail Merchandising
Unit – III
Merchandise Management

2. Merchandising
• Merchandising is Planning, Buying and selling of
Merchandise
• Its all about having right product in the right quantity
available at the right place, at the right time and at the
right price.
• More easier said than done as more selling locations and
more merchandise varieties are added.
• Magnitude of error and sub-optimal allocations can result
as a part of 5 rights
• It is the core of retail

3. Merchandise Management
• Analysis: Understand customers to make ascertain their
needs and desires for good buying decision
• Planning: Plan the merchandise to be sold in the future
now
• Acquisition: Acquire merchandise from different vendors
• Handling: Keep the merchandise in proper condition
where it can be sold easily
• Control: Control money spent in procuring merchandise.

4. A Theory of Merchandise Buying
Behaviour
Retailer Size Type of merchandising
Retailer Type Product Positioning
Retailer Location Regulatory Constraint
Management Mentality Type of Decision
Merchandise
Requirements
Choice Ideal Supplier /
Calculus Product Choice
Supplier
Selection
Choice Choice Choice
Calculus Calculus Calculus

5. The Merchandiser: Role and
Responsibilities
• Planning
• Sales Forecasts
• Preparing Budgets for the responsible area
• Directing
• Guiding and Training Buyers (Procurers)
• Coordinating
• Coordinating the Buying Team (Procurement Team)
• Controlling
• Assessing merchandise performance and buyer’s performance
• Evaluate Buyer’s performance on Net Sales, Gross margins, stock
turn

6. The Buyer: Role and Responsibilities
• Developing merchandise strategies for the product
line, store or organization that he/she is responsible
for
• Planning and selecting merchandise assortments
• Vendor Selection, development and management
• Pricing the merchandise to achieve the targets in
terms of gross margins
• Inventory Management

7. The Buying Function
• Differs from Organization to Organization
• Job akin to that of a Product Manager
• More Strategic
• Can be Centralized or Decentralized depending
upon the type of organization

8. Buying for a Single / Independent
Store
• Coordinating the purchasing for various products required by the store
• Writing orders
• Handling special orders as and when they rise
• Making decisions regarding merchandise returns
• Remerchandising the store
• Pricing decision for the product
• Planning and coordinating various promotional activities
• Customer contact and selling

9. Buying for a Chain Store
• More Specialist function
• More Centralized buying and Merchandising
• Understanding the consumers
• More diverse distribution function

10. Buying for Non – Store Retailers –
viz. Catalogues, Direct Mail etc.
• More Planning required
• Fair amount of market work required
• Clear understanding on type of merchandise
• More stress on Uniqueness of product

11. Concept of Lifestyle Merchandising
• Retailer knowingly adopting a merchandise
strategy serving the need of a specific target
audience leading a specific lifestyle
• Furniture, Cookware, Watches, bags, etc.