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Copyright © 2006 by John Wiley & Sons, Inc. All rights reserved Ch. 1: An Overview of Retail Buying • The responsibilities of buyers & merchandise managers • Skills & personality traits for success in this field • How different types of stores are organized to meet their buying needs • The pros and cons of centralized merchandising • Opportunities for women in this field Copyright © 2006 by John Wiley & Sons, Inc. All rights reserved Steps to Anticipate Customer Demand • Study consumers & their purchasing decisions • Use research to target customer groups • Determine quantity & timing of retail buys • Find & study the vendors who can provide what you need • Handle the logistics: packaging, shipping, storing, pricing, entry into store database, etc. • Work cooperatively on advertising & display • Maintain & interpret database • Watch the competitors Copyright © 2006 by John Wiley & Sons, Inc. All rights reserved “Are you cut out to be a retail buyer?” Traits and Skills for Success • • • • Decision-making skills Drive Creativity Critical, analytical, conceptual skills • Financial savvy • Organizational skills • Communication skills • Managerial or “specialist” capabilities • Trading acumen Copyright © 2006 by John Wiley & Sons, Inc. All rights reserved Planning & Control: Functions of a Merchandise (or Merchandising) Manager • Makes long-range plans for stock levels, margins, ad budget • Checks sales results against the plans • Controls OTB budget • Checks & countersigns large orders • Checks and approves any returns to vendors • Approves any price changes, checks prices with longrange plans • Approves ideas for sales events and promotions Copyright © 2006 by John Wiley & Sons, Inc. All rights reserved Store-Level Buying Systems • Warehouse Requisition Plan Store carries sufficient stock, “requisitions” more as needed • Approved Resource List Stores choose from list of “approved” goods & vendors (also called Price Agreement Plan) • Opening Stock Distribution Plan Department manager controls “opening” stock & reorders; retail buyer augments with new items • Automatic Open-to-Buy After initial buys, each department has a budget for reorders that (theoretically) cannot be exceeded Copyright © 2006 by John Wiley & Sons, Inc. All rights reserved Centralized Merchandising PROS CONS • Steady flow of merchandise to stores • More reliable forecasting • Better “big picture” of what’s selling (& not selling) • Centralized records • Quality control • Cost advantages • Better stock control • Leaves buying to the buyers, not store or dept. managers • Hard to adjust “big picture” orders to local store needs • Requires high degrees of cooperation and communication • Difficult to maintain an informed, enthusiastic sales organization • Requires clear-cut job descriptions about roles & authority Copyright © 2006 by John Wiley & Sons, Inc. All rights reserved