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Key measure of the retailer’s success is selling as much merchandise as possible at the highest profit margin. Retailers can no longer depend on random sourcing / buying in the hope that they will sell them all. There are two major areas of profit leakage in retail. Firstly - lost sales resulting from lack of stock, and secondly - forced margin reductions (markdown) due to excessive stock. There are processes and solutions in order to reduce and eliminate excess inventory and maximise profit. That is "Merchandise Planning". Merchandise Planning is "A systematic approach by the retailer, aimed at maximising return on investment, through sales & inventory planning, in order to increase profitability”. Main goal of Merchandise planning is to maximize the use of assets, and resources a company owns. In the long run, effective merchandise planning can save time, help streamline business processes and objectives, and optimize and mobilize inventory to get it off the shelves into the hands of the consumers for the right price.
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Key measure of the retailer’s success is selling as much merchandise as possible at the highest profit margin. Retailers can no longer depend on random sourcing / buying in the hope that they will sell them all. There are two major areas of profit leakage in retail. Firstly - lost sales resulting from lack of stock, and secondly - forced margin reductions (markdown) due to excessive stock. There are processes and solutions in order to reduce and eliminate excess inventory and maximise profit. That is "Merchandise Planning". Merchandise Planning is "A systematic approach by the retailer, aimed at maximising return on investment, through sales & inventory planning, in order to increase profitability”. Main goal of Merchandise planning is to maximize the use of assets, and resources a company owns. In the long run, effective merchandise planning can save time, help streamline business processes and objectives, and optimize and mobilize inventory to get it off the shelves into the hands of the consumers for the right price.
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Research provides a basic understanding of the merchandising concept to underline the relevance of merchandise planning in a retail organization. To provide information on merchandise grouping, defining the concept of merchandise hierarchy. It explains what is meant by merchandise buying and replenishment planning. This research also covers the planning and carrying out of buying and selling activities including the responsibilities of buyers. It follows the flows of merchandise from arrival in the store to purchase by the customers. Today, stores use aggressive merchandising techniques for men’s and children clothing too. Fashion influence has also spread to all other areas of retailing from cosmetics and home furnishings to cookware. Every area of merchandising responsibility needs planning and organization to make it function properly and to ensure successful buying and selling. Merchandising responsibilities are usually divided between two chains of command .The buying line has responsibility for merchandise content and assortment; the store line is the liaison between the merchandise organization and customers. The buying line works behind the scenes; the store line interface with customers on a daily basis. The goal is to sell merchandise. The merchandise managers and buyers of the buying line must do all the planning and other activities necessary to bring the right merchandise in to the store at the right time to satisfy the store customers.
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