I

ntr
oduct
iont
oFashi
onMer
chandi
sing

1.
1El
ement
sandi
mpl
i
cat
ionofFashi
onMer
chandi
sing

Merchandisi
ng:Fashion mer chandising 
canbedef ined ast heplanni
ng and pr
omoti
onofsal esby
pr
esentingapr oducttotherightmar ketattheproperti
me,bycar ryi
ngoutorgani
zedadver
ti
sing,usi
ng
at
tract
ivedisplays,et
c.Mer chandisi
ng,wi t
hinfashi
onr etai
l
,r ef
ersspeci
fi
call
ytothestockpl anni
ng,
management ,andcontrolpr
ocess.

Fashi
onmer chandi
ser
sfoll
owthefiv
eri
ghtsof 
mer
chandi
sing,or5Rs,t
oensur
ethatt
heypr
oper
lymeet
theneedsofconsumers;
thus,
tur
ningapr
ofit
.
Thef
iver
ight
sofmer
chandi
singi
ncl
ude:

 t
her
ight
 mer
chandi
se

 att
her
ight
 pr
ice

 att
her
ightt
ime

 i
nther
ightpl
ace

 i
nther
ightquant
it
ies.
Byr esearchingandansweringthefiveright
sofmer chandisi
ng,fashi
onmer chandi
ser
scangai nan
understandingofwhatproductsconsumer swant,whenandwher etheywi sht omakepur chases,and
whatpr i
ceswi l
lhav
ethehighestdemand.Bothfashi
onretail
ersandmanuf actur
ersutil
i
zethe5Rs.
Clothing manuf actur
ers practice f ashion merchandi si
ng di f
fer
entlythan r etail
ers. Manuf
acturer
mer chandisers 
for
ecast 
customer s'pr efer
encesforsilhouett
es,sizes,col
ors,quantiti
es,andcostseach
season.Whenmaki ngdeci si
ons, manuf actur
ermer chandisersmustkeepr etai
lersandendconsumer si n
mind.Fol lowingthef or
ecastingst age,manuf acturermer chandisersmeetwi thdesignerstodevelop
product st hatconsumer s willpur chase most .By r eferr
ing tot he fi
ver i
ghts ofmer chandi
sing,
manuf act
urermerchandisersdet er
mi net hebestfabr i
c,notions,productmet hods,andpr omoti
onsf or
]
product s.
 Thesedecisi
onsallcont r
ibut etofi
nalr
etailcosts,whichmustbeaf fordabletoendconsumer s.

Retailer
sI ncompar i
sontomanuf actur ermer chandi sers,ret
ailermer chandi ser sal sobegi ntheirprocess
byfor ecast i
ngindustryandfashiont r endswi tht heirtargetmar ketsinmi nd.Sal esar epredictedi nr etai
l
doll
ar s and begi nni
ng oft he mont h( BOM)st ock.Si mil
art o manuf actur ermer chandisers,ret ail
er
mer chandi sersmustmakeal ldecisionsr egardi
ngt hefinalconsumer .Decisi onsar emadebasedont he
past, pr
esent ,andfutureoftheeconomy ,sal
es, i
ndust ryandf ashiont r
ends, r
egi onandwor ldev ents,and
thef ashioncy cle.Whenselectingmer chandiset oof fer,ret
ail
ermer chandiser swi llconsidertheirt arget
mar kets'col or,st yl
e,size,and cost pr eferences.Once accur ate deci sions ar e made,r et ail
er
mer chandi serswi l
lordergoodsf rom v endor sorpr oduce privatelabels. Fol l
owi ngshi pment ,order ed
seasonal apparelassort
ment sarest rategicall
yar rangedonsal esfloors,or visual lymer chandised.

Inthef ashionindustry,ther
earet wodif
fer
entmer chandisi
ngt eams:(1)thev i
sualmerchandisingt eam,
and( 2)thef ashionmer chandisi
ngteam.Thev isualmer chandi si
ngteam ar et hepeopleinchar geof
designingt hel ayout,fl
oorplan,andthedisplaysoft hest orei nordert
oi ncreasesales.Thef ashi on
mer chandisingt eam arethepeoplewhoareinvolvedint hepr oducti
onoffashi ondesignsanddi str
ibution
off inalproduct stot heendconsumer .Fashionmer chandi serswor kwi t
hdesi gnerst oensur et hat
designswi llbeaf f
ordableanddesiredbyt het argetmar ket .Fashionmer chandisinginvol
vesappar el
,
accessor i
es,beaut y,and housewares.The end goaloff ashi
on mer chandising i
n any oft hese
depart
mentsistoearnaprofi
t.Fashi
onmerchandi
sers'deci
sionscanconsi
der
abl
yimpactt
hesuccess
ofthemanufact
urer
,desi
gner
,orretai
l
erf
orwhichtheywork.
Inmoder nmer chandising,di
stri
butionresponsibil
i
tiesareabsent ,andf ocusisplacedonpl anni
ngand
analysis.Asepar atet eam istaskedwi thdistri
buti
on.Lar georganizat
ionsseparat emer chandiser
sby
type.Ther eare( 3)retailmerchandiser
sand( 4)productmer chandisers.Retai
lmer chandisersmanage
storeal l
ocati
onandmustmaxi mizesales.Pr oductmer chandisersmanaget hef l
ow ofmat eri
alst
o
suppliersandthent hef lowofpr oducttostores.Productmer chandiser
st henpasscont r
olofpr oductt
o
theretailmerchandisers.
Manyl ar
geor ganizat ionshav econcl udedt hatdi stri
but i
onr equi r
eshi ghl
ydet ailedwor kandt hatitis
necessar ytohav eat eam speci fi
call
yf orthatpur pose.Thi sisduet othefinedet ailsofal l
ocat i
on, which
requirefocusonaspect ssuchascol ourandsi zesf oraspeci fi
cst ore.Thisappr oachnotonl ymi nimizes
costsbutal soext endst oar easl i
kebet tercont r
oloft heov erallprocess.Or gani zati
onst hatdonot
conductdi stri
butiont hiswayr isklosingcont roloft heirstockatbot hthehi ghestandl owestl evel.Thisis
ar esultofthel ackofuni f
or mi t
yandov ersight .Thedi stri
butiont eam speci ali
zesnotonl yinmanagi ng
distr
ibuti
on,butt heyar eal sof ocusedonsal esandpr ofi
t.Theyempl oydet ail
ed,accur atei nformat i
on
aboutdi str
ibutionpoi nt ssour cedf rom pr oductpl anner s.Theypossesst heabi lit
yt omanagedy namic
stockdemands.Theypar t
nerwi thbuy er
sandmer chandi sersf oranynecessar yr epeatbuy ing.Though
theyar e positioned t o manage st ock,t heyst illoper ate wi t
hint he limitsoft he buying pl an,and
mer chandisersensur et heyr emai nwi thint hisr eal m.Buy ersprov i
degui deli
nesf ordi st
ri
butionsuchas
thet ypeofst oreswher epr oductshoul dbedi stributed;f orexampl e,apr oductmayhav eonl ybeen
acquiredf ort het op3st or es.Thet eam al sosuppor tst hegoal sofanor gani zationt hroughbei ng
i
nst r
ument alinr espondi ngt ot rends.Thenat ureofmoder nanal ysi
shasal lowedmanymer chandi sersto
planasmuchasf ourseasonsahead,andt heyar eexpect edt oappl ythedat a.Thi sf urt
herincr easet he
demandpl acedont hei rrolesandemphasi zest heneedt otaskoutmi nordet ail
st hatdonotr equi retheir
i
nputormuchoft hei rsuper vi
sion.

1.
2Ty
pesofFashi
onMer
chandi
sing
Thet erm“ Merchandiser” defi
nedasa  ‘Personwhodobuy i
ngandsel l
ingofgoodsf orthepur poseof
maki ngapr ofi
t.
’ 
Infashioni ndustrytherear edi f
ferenttypesofmer chandisi
ngprofi
leswhicharemeant
toper f
orm dif
ferenttypesoff unct
ionsal ltogetheratdi ff
erentstagesoff ashi
onindustr
y.Overthey ears
oft hegr owthofmer chandi singasadi scipli
nei nthef ashionindustry
,therehavebeenmanychangesi n
the j ob profi
l
e oft hemer chandiser.Ithaschar gesf rom a simpl et o a much morecompl exj ob
transcendingal mostal lfunctionsinf ashioni ndustry.Thishasl edtoachangei ntheskil
lsrequiredfor
thej obandev oluti
onoft hedi scipl
ineoff ashionmer chandisi
ng.
Differenttypesofmer chandi singinfashioni ndustrycanbedescr i
bedi nfol
lowingway.

Ther ol
eofmer chandiseri sverycrucialanddemandi ngi nfashionindustr
y .Thedev elopmentofdesi gn,
product i
onexecut ionandsour ci
ng, sel
lingt hemer chandiset ocustomeranddi splayi
ngt hemer chandise
atr etai
lshop,t hesear et hefunctionsoff ashionmer chandiseratdiffer
entl evelofindust r
y.Theski ll
s
requirementoff ashionmer chandisingt uningwi t
hcur rentt r
endsi nmar ket,forecastingofupcomi ng
fashiont rends,technicalparamet erslikef abricandt rim detail
s,garmentqual it
y,decidingthesour cing
strategy,communi cati
on and coor dinati
on al ong wi t
h concer n peoplei nt he i ndust
ry. Fashi
on
mer chandi sert
akesdesi gnorsket chf rom desi gneranddev el
opsitinsuchawayt hati twi
llbemar ket
feasible,producti
onf easible,
andmeet scust omerdemands.

Str
uctureoffashi
onindust
ry:
Thestruct
ureoffashi
onindustr
yischangesfrom st
rat
egi
esadopt
edbyt
hebuy
ersf
rom di
ff
erentcount
ry.
Butthecommont r
endfoll
owedintheindust
ryisas.
 
Allov
ertheworldthisst
ruct
urei
sfoll
owed,someti
mesbuy
erdir
ect
lypl
acestheor
derwit
hexport
er.But
about60-70%oftotalbusi
nessoffashi
onproduct
sisr
unthr
oughthebuyi
nghouse.I
nallt
hisprocess
themerchandi
serplayst
heimport
antrol
e.

Needofmerchandi
sing:
Theneedofmerchandisi
ngi
nwhol
efashi
oni
ndust
ryi
ssummar
isedasf
oll
ows

Fr
om buy er sper spect ive:
 Tof i
ndoutt hemar kett rend
 Tomaket hef orecastofmar ket,i
nor dert odev elopthenewst yle
 Pr oductdev el opmenti sdonebymer chandi ser
 Dev el opmentofnewl inef ort henextseason
 Li nepl ani sdev el opedbyt hemer chandi ser
 Maket hemar ket i
ngcal endar
 TomakeCommuni cat ionandcoor dinati
onwi thbuy inghouseandmanuf act
urermer chandi
seri
s
needed.
Fr
om buy inghouseper spect i
v e:
 Tomaket hecoor di nat i
onwi ththevendor saswel lasbuy er
 Fol lowupoft heexpor tor der.
 Anal y sisofmar keti sdonebybuy inghousemer chandiser
 Br ingt heor der st obuy i
nghouse
 Cost i
ngi sdonebymer chandi ser
 Fi l
lingt hedai lyr epor t
st hatbuy inghousedeal swi t
h
Fr
om manuf acturersper spect i
v e:
 Thepr oduct i
onmer chandi serplayst hebr idgebet weent hemanuf act
uresandbuy er
 Theneedofmer chandi serst artswhenenqui ryofbuy erscomesf ornewor der
 Buy ercommuni cat esal lt hei nf
ormat i
ont ot hemer chandi ser
,whi lemerchandiserneedstoconver
t
thati nf ormat i
oni nt of ormatwhi chi sunder standablet oproductionexecut i
ves.
 Fort he pr operor derf ollowupmer chandi seri sneeded
 Thef abr icandt rimsconsumpt i
onandcost ingisdonebyt hemer chandiser.
Advantagesofmer chandi si
ng:
 Mer chandi singJobi sv er ydemandi ng
 Wel l pai ddesi gnat ion
 Oppor t
uni t
yt ot rav el
 Per sonal growt h
 Asi ti samul t
ipleact i
vityj obdesi gnat ion,henceeasyt omov einrelat
edar ea.
 Wi dev arieti
esofj oboppor tunit
iesar eav ailable.
 Cont actwi tht hepeopl ef rom di f
ferentbackgr ound,cul t
ure,country,l
anguages.
 Dev el opmentofsof tski lls.
Di
sadv ant agesofmer chandi sing:
 Excessi vewor kl oad
 Excessi vet r
av elling
 Ant isoci alappr oach
  Hugecompet it
ion
 Rigidityi
nt r
ainingprogram
 Longandl atewor ki
nghour s
Dif
fer
entfor msofmer chandi
sing:
Expor
tMer chandising
Expor
tmer chandisi
ngi st hebridgebet weenthebuy
erandthemanufact
urer
.Iti
st hebackboneof
appar
elexpor tindustry.Asthest ruct
ureofindust
ryi
srout
ingt
hrought
hebuyinghousehence,expor
t
merchandisingcanbedi vi
dedintwot ypes

 Inexportproductionhouse
 Inbuy i
nghouse
1.1Merchandisi
nginGar mentProduct
ion:
Ifthegarmentproducti
onhousei ssmallthenall
 thejobofmer chandi
singisdonebyoneperson,butat
thesamet i
mei fi
tis bigproducti
onhousethenjobofmer chandiser
sisspecif
ied,
anddivi
ded accor
ding
tothefunct
ionmer chandiserper
form,
e.g.Marketi
ng,sour
cing,
 sampl i
ng,pr
oductdev
elopment,pl
anni
ng,
etc.

Marketi
ngMerchandiser:
Themai nj
obofmar ket
ingmerchandiseristodot hemarketi
ngofthefactor
yinthemarketandgetthe
new buyer
sandt henew order
s.Onceor deri
sconf i
rmedfrom thebuy
er,thenmarket
ingmerchandi
ser
wil
lhandovert
heor derstot
hepr oducti
onmer chandi
serf
orthefurt
herf
ollowups.

Pr
oducti
onmerchandising:
Pr
oducti
on merchandisersarethefaceofgarmenti ndustr
y.Theynor mal
l
yr epresentthegarment
i
ndust
rytothebuy er
.Ther ol
eofproduct
ionmerchandiseri
sv er
ycruci
alasthesuccessofanyexport
or
derislar
gel
ydependsonper f
ormanceandcoordinat
ionski
llofpr
oducti
onmerchandiser
.Theroleof
pr
oducti
onmerchandisercanbesummar i
sedasf
ollows

 Communi cati
onwi thbuy er
 Coor dinationwi thinthepr oduct ion
 Fol l
owupofdi fferentappr ovals
 Pr oductdev elopment
 Cost ing
 Sour cingorpur chasingofr awmat eri
al
 Pr eparati
onofBOM, TNAandt r
im card
 Shi pmentschedul i
ng
 Communi cati
onwi thfrei
ghtf orwarder
Sourci
ngmer chandiser :
Sourci
ngmer chandi serwor ksf ort hesour cingoff abr
icandtri
ms.Hewil
ltakecareofonlysourci
ng
specif
iedwor ki nthei ndustry
.I nbi ggeror ganizat
ionthiswor
kisdonebydiff
erentper
son,pr
oducti
on
merchandiserwi ll
giv eonlyspeci f i
cationsrelatedtofabr
icandt
ri
ms.

Sampli
ngmerchandiser:
Sampli
ngmerchandisertakescareofsampl i
ngonly;producti
onmer chandi
serprov
idesallt
hedetai
lsto
sampli
ngmerchandiser.Accor
dingtospecifi
cati
onsampl i
ngmer chandisermakessurethatsamplewil
l
besendtobuyerontimewi t
hcor r
ectrequi
rementsofbuyer.Therol
eofsampl i
ngmer chandi
seri
stotake
fol
l
owupofall sampli
ngaswel lastakecareforqual
it
yoft hesamples.

Productdev elopmentmer chandiser

:
Someor gani zati
onshav ein-
housedesignstudioordesigndev elopmentdepar t
ment ,expor
terproacti
vel
y
developsdesi gnsseasonal l
y.Thesedesi gnsneedt odev el
opi ntheform ofsampl esandneedst o
presenttot hebuy er
.PDmer chandisertakescarealltheactiv
iti
esl i
kedesigndevelopment,av ai
l
abil
i
tyof
the fabrics and t r
ims fort he same,getf ollow up ofdev el
opmentsampl es.Somet i
mes some
organizationshav ei n-
housef abri
cproducti
on;hencedev elopmentoff abri
cisal sofoll
owedupbyPD
mer chandi ser.Tobringthebusinesstotheorganizat
ionisthepot enti
alr
oleofPDmer chandiser.
Planningmerchandi ser:
Mainr esponsibi
li
tyofpl anningmer chandi seristodot hepr oducti
onplanning.Planni
ngmer chandiser
normal l
ycoordinateswi thsourcingt eam t ogetalltheraw mat eri
aldel
iverydatesandwi thIndustri
al
Engineeri
ngdepar tmentf orgett heSAM v al
ueoft hegarment s.Thenal ongwi thproduct
iont eam
pl
anningmer chandi serwilldothepl anningofpr oduct
ionbyconsi der
ingtheeffi
ciencyandabsenteeism
oftheoper at
or.Planningmer chandiseralsoneedst ocoordinateswithcut
tingandpackagingdepartment
i
nor dertosendt heaccur atemerchandi seont i
met obuyer.

1.2Buy i
nghousemer chandising
Ther ol
eofbuy inghousemer chandiseri ssl
ight
lydiffer entfrom pr oduct
ionmer chandi
ser.Buyinghouse
i
sanagentwhowor kswi ththebuy erandmanuf act ur er/
exportert ofulf
ilt
heobl i
gati
onoft heexport
order.Buyi
nghousemer chandiserdi
rectlycommuni cat edwi thbuy er.Thefuncti
onofanybuy i
nghousei s
torepresenttheiroverseascust omer.Thewor kdonebybuy i
nghousei sdependsuponsi zeofbuy ing
house,v ol
umeshandl ed,servicesprovidedtobuy er.Pr imepur poseofmer chandiseri
st oensuret hat
deli
veryoftheor deri
sont i
me.Ther oleofbuy i
nghousecanbedescr i
bedas

 Resear chinf ormat ion

 I dentifyi
ngv endor s
 Keepi ngt r
acksont rends, under standingt hebuy er
s’mar ket
 Pr oductdev elopmentf orbuy er
 Dev elopmentofnewf abrics
 Tot al costingofpar ticularst yle
 Pl acementofor der s
 Sour cingoff abr icandaccessor ies
 Qual i
tycont rol
 Updat ingthepr oduct iont r
acki ngchar ts
 Document at i
onandl ogistics
 Ti mel ydeliver yofshi pment s
Ret ailmerchandi sing
Ret ailMerchandi ser sar eresponsi bleforensur i
ngthatproduct sappeari nt her i
ghtstoreattherightt i
me
andi nther i
ghtquant i
ti
es.Thi si nvolveswor ki
ngcloselywi tht hebuy i
ngt eamst oaccuratel
yf orecast
trends,planst ockl ev elsandmoni torper f
ormance.Whi l
et hebuy ersel
ect st hel i
nes,t
hemer chandi ser
deci deshowmuchmoneyshoul dbespent ,howmanyl i
nesshoul dbeboughtandi nwhatquant it
ies.In
smal l
ercompani es,t he same per son may be r esponsiblef orbot h buy ing and mer chandi si
ng.
Mer chandi serspl ayakeyr ol
ewi thinor ganisati
ons,aspr ofi
tabilit
ycanbeaf fectedbyhowsuccessf ul
ly
theyunder takethei rwor k.Mer chandi serssetpr icestomaxi mi sepr of
it
sandmanaget heperformanceof
ranges, planningpr omot ionsandmar kdownsasnecessar y.Theyal soov erseedel iver
yanddistri
butionof
stockanddeal wi thsuppl iers.

1.
3.Vi sual merchandising
As av isual 
mer chandiser ,
 
display desi
gneror 
window dresser 
i
t woul dbe 
jobofv i
sualmerchandisert o
create ey e-
catching pr oduct displaysin shops and st or
es.
 Visualmer chandiserisresponsible for
presentingpr oductsinawayt hatat t
ractscust
omers andmaxi mi ses 
sal
es.Thiscoul dmeanany thi
ng
fr
om decor ati
ngast orei naseasonal  
theme–l ikeChristmasorspr i
ng 
sales 
–t omaking sure 
store’s
di
splay sfit 
thecompany ’s 
brandi mage.

Concl usion`
‘
Mer chandi sing’i sverywi det erminologyusedi nindustry
.Ther ol
eoft hemer chandiserisv ar
iesf r
om
stagesoft hef ashioni ndust
ryl i
kepr oduct
ion,buyinghouse,retai
landsel ls,visualmer chandiser.The
workofmer chandiserdy nami call
ychangesf rom or gani
zat
iont oor gani
zation.Insomeor ganizati
on
mer chandi serpl ayswi der ol
ewhi l
einsomeor ganizati
onrol
eofmer chandiserisv er
yspeci fi
c.Thej ob
profil
eofmer chandiseri salsochangi ngwi t
ht hegr owthofappar elindustrytodayi tbecomesmor e
compl icatedt hanprev i
ous.Ther equi
rementofski l
lsformerchandisi
ngchangesdr astical
lywithrespect
toor ganizat i
onandst ageoff ashionindustr
y.
1.3Mer chandi singconceptandpl anning
Mer chandi sepl anni ngi samet hodofsel ecting, managi ng,purchasi ng,display i
ng, andpricingt hepr oduct
sin
amannert hatbr ingsi nmax i
mum r eturnsoni nv est ment ,val
ueaddi ti
ont othebr andnamebysat isfyi
ngthe
consumerneedswhi leav oidi
ngt hecr eationofex cessi nv
ent ory.Mor eover,mer chandisepl anningi sabout
str
ivingt omak ether i
ghtpr oductav ail
abl e,att her ightti
me, i
nt her ightplace, int heri
ghtquant it
ies,andat
ther i
ghtpr ice.Youcanal somak euseofappr opr iat emerchandisei nventor ysof twareforst reaml i
ningyour
i
nv ent oryoper ati
ons. PlanningMer chandi secanr educemar k
downs, outofst ocks, andov erstockscenar i
os.
ThePr ocessofMer chandi si
ng-Howt oPl anMer chandi se
Everyi ndust rywi llhav eadi fferentwayofappr oacht omer chandi sepl anni ngt hatwi l
lsui ttheirspecifi
c
needs.Ret ai lindust ri
esl i
k eclothingwi l
lhav et of ocusont hesi ze,color,anddesi gnthatwi llbeindemand
andhowmanyoft hem t heywi l
lbesel l
ing.Incont r ast
,anonl inegr oceryst orewi llhavet ofocusonsel li
ng
dif
fer entt y
pesofedi bleitemsandwhatpeopl ewi ll needmor ei napar t
icul
arseason.
Whati smer chandi sei nventory?Mer chandi sei nv ent oryistheaccountgi v
enonabal ancesheett hatshows
thet otalamountpai df orallthepr oduct sst il
lint hequeuet osel l.Nev ert
heless, thereisst il
laf undament al
mer chandi singpr ocess,whi chi sfol l
owedbymostoft hecompani esandar oundwhi chtheyst r
ucturetheir
planofact i
on. Also,thest epsinmer chandi singplanningareeasyt olearnandf ol
low.
Thef ir
stt hingy ouneedt odoi sanal yset hepr eviousseasons’ salesdat aandr evenueofeachpr oductand
thebusi nessf oreachweekasawhol eal ongwi thmar k
etsur v
ey sandconsumerdemandsy oucanf orecast
demandf ort hecur rentseason.
Demandf orecast i
ngi sthepi ll
arar oundwhi cht hestrat
egyi scrafterbecause, basedont hi
s, t
hestock sar e
stuf fedup. For ecastinginv olv
est heant icipat i
onofhowacust omerwoul dbehav edur i
ngasal esseason.
Asal esf orecasti st hepr i
mar yst epi nf i
gur ingoutt heamountofi nv entoryisneededandatwhatt ime.I n
det ail,
theest imat esshoul dtellyouaboutt henumberoft hepr oduct sr equiredtopur chase,thesell
ingpr ice
oft hepr oduct s,andi fitisneededt oaddnewpr oductstothemer chandi seassor tment .
Most lyinsal esordemandf orecastpl anni ng,therear etwoappr oachesonei st op-downpl anningand
bot tom- uppl anning.I nt op-downpl anni ng,t heseni ormanagementf i
gur esoutt hedemandandsal espl an,
andt heni ti sgi vent ot hemer chandi singt eam.Ont heot herhand,bot tom- upplanningi sthatinwhi cht he
mi d-leveldepar tmentmanager sest imat et hedemand.Dat aderivedf rom bot happr oachesar ethenaddedt o
gett het otal demandf igures.

Foll
owt hesegi venpoi ntst of or ecastt hemer chandi ser equirement s
Anal yzingPastSal esDat a: Asment i
onedpr ev i
ousl y ,rev i
ewi ngt hesal esdat aofpastseasonsoft he
sameper iodandcompar ingt hem wi t
ht hecur r
entsal est rendscanbev eryhel pfult ocat cht hepat t
ernof
biasi nt hecust omer ’
schoi ces.
Anal yzingt heeconomi cst ateoft hemar ket :
 Bev erysur et haty ouknow t hef inanci alcondi ti
onoft he
mar ketbecauser ecessi onscanaf fectt hespendi ngpat t
er noft heconsumer s.
Rev i
ewi ngt hesal espot ent ialoft hepr oduct : 
Compar et hemar ketdemandoft hepr oductandcal culate
thepossi bilityoft hatpr oduct .
Resear cht hemar ketf ornewmar ketingst r
at egi esoft hecompet it
or s:
 Mar ket ingst rat egyi sal socr iti
cal
apar tf r
om t hedemandf or ecast .Findouti ft her e’sanewwayy oucanmar kety ourpr oduct ,orar epeopl e
l
ooki ngf oranewpr oduct , ordoy ouneedt oi ntroduceanewmer chandi selinei nt hemar ket .
Accumul at ingt hedat aandcr eat i
ngt hef inalmer chandi sef or ecast : 
Af t
ercar ry i
ngoutal ltheanal ysisand
calcul ations, theny oucancompi leallt hedat aandcomet oaf inalpr edicti
onf oreachpr oduct .And, only
theny ouaddmor ei nv ent or yt oy ourwar ehouse.
Decidi ngont heMer chandi seNeeds
Nowaf tery ouhav ef orecast eddemandandy ouk nowhowmuchy ouneedt opl anhowy ouar egoi ngt obuy
andmanaget hepr oduct ssot haty oucanpr ov i
det her ightpr oduct ,att her i
ghtt imeandi nt her i
ghtpl acet o
yourbel ov edcust omer .
Nowt herear est epsy ouneedt ot aketopl any ourmer chandi se.
(1) 
Budget ing
(2) 
Assor tmentPl an
Budget ingi st hef irstst ageofmer chandi sepl anni ngbecause,f irst,youneedt ok now how muchofy our
moneywi llbei nv est edorhowy oucanmi nimi z eit .
Thebudgetcompr isesf ivesect ions.
Thesal espl an  –Pr oj ect ingt heamountofeachpr oductt hatwi l
lbesol dt hisseasonf rom eachr etai
l
outlet ,onl i
nepl at for m, ormar ketplaces.
Invent or ypl an–t hi swi llt elly ouhowmuchi nv ent or yy ouneedt ost ockt oachi ev ethedemand.
Thepl annedr educt i
ons  –Thi si sabackup.I t’st her educt ioni napr oduct ’
squant i
tyi ncaset hepr oduct
doesnotper f orm.
Planni ngt hepur chasel ev els –Pl anningofhowmuchasi ngl epr oductwi llbepr ocur ed.
Deci dingongr ossmar gi n –t hedi f
ferencebet weent hesel li
ngpr iceandt heCOGS
Assor tmentPl anni ng
VanHer pendef inesassor tmentpl anningast hecombi nationofal lproduct smadeav ai
labl einast ore”anda
setofpr oduct sof f eredwi t
hi napr oductcat egor y .Thesepr oduct sf orm asetbecauset heyshar esi mi l
ar
physi cal char act erist ics.
Assor tmentPl anni ng  i
saboutdeci dingt henumberofeachpr oductt hatwi l
lbeboughtt omak esur et he
demandi smet .Assor t
mentpl anningi sdonemaj or l
yt oensur et hatcust omer sar eallocat edpr oduct sina
balancedway .Thedet ailsofi nv entorylikecol or ,size, mat erials, brand, etc.arespeci f
ied.
Mer chandi seHi er ar chy : 
Pr oduct sar ecl assi fi
edorar rangedi nawayt hatwoul dsui ttheconsumer ’sbuy ing
patter ns.Thi si scal ledamer chandi sehi erarchyi nwhi cht hepr oduct sl ikelytobepi ckedf ir
stormor ei n
quant ityar egr ouped,andt hepr oduct st hatar el essl ikel
yt obesol dar ek eptt oget her.Manyt imest he
gr oupi ngcangoont ocr eat e5- 6l ev els.
Whyy ouNeedt oPl any ourMer chandi se?
Ret ailer sofmoder nt imesmi ghtnotaskt hi
squest ionbecauset heyk nowhowv i
tal mer chandi sepl anni ngi s;
howev er ,fort hebegi nner sort heoneswhot hinkt hati tisnott hati mpor tant , her ear esomeoft her easons
whyy oushoul dpl any ourmer chandi se.
Mer chandi sepl anni ngcanhel py oust ocky ourwar ehousei nawayt hati ncr easest hei nv ent oryt urnov er
rat i
o.
Itdecr easesi nv ent orycar ryingcost sast her ei sl essunwant edi nv ent or yi nt hewar ehouseandhence
l
essl abor ,lessmai ntenancecost ,lessl osst hroughobsol escenceasmostoft hest ocki ssol d,less
depr eci ationofi nv ent ory, etc.
Br ingsv alueaddi tiont ot hecompanyasy ourcust omerv er yr arelygoesempt y-handedandhasenough
opt ionst ocompar epr oduct stomakeapur chase.
Sincey ouhav et her ightpr oduct ,int her i
ghtquant i
ties,att her ighttime, att her i
ghtpl ace, andatt her ight
sel li
ngpr ice,y oudon’ thav et opr ov i
demor edi scount st ogetr idofol di nv ent ory ,andt her ear ev eryf ew
outofst ocksi tuat ions.
Youdon’ thav et ogot hroughsi tuat i
onsofpani cwhi let r
y ingt omanagey ouri nv ent oryandmeett he
demand.
Pl anni ngmer chandi sesmar tl
yl eadst osmar tinv est menti ni nv entor yi.e.; yourmoneyi st i
edt oonl yt hose
st ockst hatwi ll gener at er ev enue.
Yourr ev enuesi ncr easeast her ear ef ewermar kdowns, andpr oduct sar eav ailabl ef orsal e.
Chal lengesi nMer chandi sePl anni ng
Mer chandi sepl anni ngi sn’taseasyasi tseemsonpaper .Ther ear eal otofdi l
emmasi nv ol
v edi nthis, andas
asmar tpl anner ,y ouneedt omak ecor rectdeci sionst ogetoutoft hosedi lemmas.
Mai ntai ningabal ancebet weenanonl ineandof fliner etailbusi ness
Yes, ret ailershav ingbusi nessbot honl i
neandof flinehav etodesi gnacour seofact i
onf orbot handensur e
thatt hei nv ent or yi sav ailabl ef orbot hpor tals.Under standingt heneedsofanonl inecust omerandof fl
ine
cust omeri st hek eybecausebot h, thought heywantaqual i
typr oduct ,hav eadi f f
er entappr oacht oshoppi ng.
Asf arasof fl
inei sconcer ned,  
visual mer chandi sing  playsav i
tal rol
einseal i
ngt hedeal .
Youneedt ohav eanOmnichannelappr oacht omak ei twor k,andt her efor ey oushoul dhav eagr eat
connect ionbet weenal lthest oresandt heirinv ent ory .Fort hat ,acent r
aliz edi nv ent orymanagementsy stem
canhel py out oaccumul ateal lthedat aononedesk topscr een.
Bl i
ndl ybel i
ev ingt hehi stor ical dat a
Mostbi gcompani esar ecur sedwi tht hisbecauset heyhav edat ai nabundance, andi t
’sst r
ai ghtforwar df ora
plannert ogetl osti nt hedet ailsoft hedat aandf orgett hecur rentsi t
uat ions.Ther ef ore, it’
sessent ialt otak e
thecur rentmar ketbehav i
ourser iousl yandamal gamat ethehi stor i
caldat awi t
ht hecur rentt rends.
 
Howmuchoft her ightpr oducti senough?
Thi si sal soabal anci ngactbecauseaf tery ouk nowt hatapr oducti sr ightf ort heconsumer s,youneedt o
figur eouthowmuchoft hatcor rectpr oducti senough.Thequant i
tyissi gni ficantbecausey oumi ghtt hink
thatt hemer chandi sewi l
lsel lsmoot hl y,butt her ei sal imitt oev erything,soy ouneedt ounder st andhow
muchy oushoul dst ockwi thoutov erst ock i
ng.Youcanuset heOTBf ormul ai .e.,opent obuyt omak esur e
youar ebuy i
ngi nacont rolledmanner .
 
Pl anni ngmer chandi sef ori nter nat ional mar kets
Itisv erymuchessent ialtounder standt hatt hepl ant hatwor k sf orthedomest icmar ketsmayf allf
latf ort he
i
nt ernat ionalmar ket,i ncludi ngt hechoi ceofmer chandi sebecauseoft hechangei ncul ture,geol ogical
demogr aphi cs, andweat her .
1.
4Dut
iesofMer
chandi
ser

DutiesofMer chandi seri nReady madeGar mentI ndust r

y:
An appar elmer chandi ser  shouldf oll
owt hebel owr esponsibilit
ies:
1. I nternal &ext ernal communi cati
on,
2. Sampl i
ng,
3. Pr epar ingi nternal ordersheet s,
4. Accessor i
es &t rimsi n-housing,
5. Pr epar ingpur chaseor ders,
6. Get ti
ngappr ovalsonl abdips,
7. Adv isi
ngandassi stingpr oductionand  qual i
tydepar tment ,
8. Taki ngr esponsi bilit
yf or i
nspections,
9. Gi vingshi ppingi nst ruct i
onsandf ollowingshi pment .
Alltheabov er esponsi bili
tiesofagar mentmer chandi serhaveexpl ainedint hef oll
owing:
1.Internal&ext ernalcommuni cat i
on:
A mer chandi ser  
hast ocommuni catenotonl ywi tht hebuy ersbutal sowi tht heot her
ssuchassuppl i
ers,
nomi natedf act oryowner s,  
fabri
c manuf act urer s,etc.
2.Sampl ing:Iti soneoft hemosti mpor tantt asksf orall 
appar elmer chandi sers.Here,sampl eshaveto
developaccor dingt ot hebuy er’
si nstr
uct ion.Di f
ferent t
ypesofsampl es shoul dbedev elopedher esuch
aspr otosampl e,fitsampl e,fi
t 
sampl e, phot oshootsampl e,sal esmansampl e, si
zesetsampl e,et
c.
3.Pr eparingi nternalor dersheet s:
Anappar elmer chandi serhast opr epar ev arioust y pesofi nternalordersheet ssuchas  cost i
ngsheets,
booki ngsheet s,etc.
4.Accessor ies&t rimsi n-housi ng:
Aft
erconf ir
mat ionofa  gar mentexpor tor der ,agar mentmer chandiserhast obookandi n-houseallki
nds
of t
rimmi ngsandaccessor ies  accordingtothebuy er’
sinstruct i
on.
5.Pr epar ingpur chaseor der s:
Differentt ypes ofpur chase or ders shoul d be pr epared her e by the garment s mer chandiser 
such
as fabr ic, sewi ngt hread, t
rimmi ngs,and accessor ies, 
etc.
6.Get ti
ngappr ov alsonl abdi ps:
Itist heot heri mpor tantt askofanappar el 
mer chandi ser.Atf i
rst
,labdipshoul dbedonebymai nt
aini
ng
thebuy er’sr ecommendat ionandsubmi ttedbyt hemer chandi sertothebuy erf oritsappr oval.Ifit
’sok
thent hebuy erappr ov edi tf orr unning garmentpr oduct ion.
7.Adv isingandassi stingpr oduct i
onandqual it
ydepar tment :
A gar mentmer chandi sermusthav eto make a good r el
ati
onship witht he gar mentpr oducti
on
and  qual ity depar tment f or smoot h and  fault-
free product i
on. Thi s al
so cr eates a gr eat impact
on shi ppi ng  thepr oductt i
mel y.
8.Taki ngr esponsi bi l
ityf ori nspect ions:
Inspect i
on  shoul dbedonebef oreshi ppi
ngt hepr oducttot hebuy er.Here,themer chandiserplay sa
significantr oletoi nspectt hepr oductbyusi ngast rongqual itydepar t
mentort hird-par
ty  
quali
ty i
nspector.
9.Gi vingshi ppingi nst r
uct ionsandf ol
lowingshi pment :
Itist hel astandf inalt askofan  appar elmer chandi ser.Her e,thegarmentmer chandiseradv i
sesv ari
ous
i
nst ruct ionst ot hecommer cialdepar tmentaboutt heshipmentofagar ment expor torder.Bymai nt
aini
ng
thosei nst ruct i
ons, thecommer ci
aldepar t
mentwi llshipthepr oductstothebuy er.
ConsumerBehav
ior

2.1ConsumerBehav ior :Int r

oduct i
on: Fashi oni sthesecondmostpol lutingi ndust r yont he
planetandi shav i
ngamassi v ei mpactont heear th’sr esour ces.Thet ext il
epr oduct ionand
demandsoff astf ashi onmeant hatt her ear esev er eimpact sonnat ur alresour ces, expl oitati
on
ofwor ker sandenv ironment al damaget hroughmanuf act ur i
ng, wast eanddi sposal ofcl ot hes. 
Manymanuf act urers, brandsandsuppl i
er sar enowaddr essi ngi ssuesofsust ainabi lityt hrough
eco- friendl yt ext il
epr oduct ion, butt hisi sn’tenough.I nor dert omakeat ruedi f fer encei nthe
sust ainabi l
ityoft ext i
lepr oduct ion, consumer smustl eadt heway .Consumer shav et hepower
todemandchange.Howev er, changi ngconsumerbehav i
ort owar dsf astf ashi oni scompl ex, so
ther emustbeacombi nedappr oachf r
om i ndust ryt ocr eat et rulyef fectivechange.
Consumer smustt akemor er esponsi bilityf orcr eat ingsust ainabl ef ashi on:Thef ashi on
i
ndust ryhasr espondedt ot heneedt odev el opmor esust ainabl ef ashi onopt i
onsandeco-
fri
endl yf ashi onpr oduct i
on.Campai gnssuchas  Fashi onRev ol ution,  
Fai rWear  and  Cl ean
Clot hes  arest ar ti
ngt ogai nt ract ioni nt hei ndust ry .Suppl i
er sandbr andsar edev elopi ngand
usingmor eeco- fri
endl ymanuf act uringt echni ques, cr eat ingecody esandf abr ics, impl ement ing
Cor por at eSoci alResponsi bili
tyact ions, proact i
velyeducat i
ngt hei rcust omer sonf ashi on
sust ainabi l
ityandst reaml i
ni ngt extilesuppl ychai nst or educewast e. Althought hesemeasur es
arehav ingani mpact , theconsumerst illremai nsr el uct antt opur chasesust ainabl ef ashi on.
Wi thoutt hei rbuy -
in, thef ashi oni ndust rywon’ tbeabl et o, orhav et hemot ivat iont ochange.
Consumer sneedt otakesomer esponsi bil
ityt oo.
Consumer shav ecompl exbuy ingbehav ior s:Buy ingf ashi oni sa  compl expr ocessf or
consumer s.Theemot ional aspect sofsel f
-image, i
mpul sepur chasesandconst ant lychangi ng
fashi oncombi newi thcost ,per sonal circumst ances, massi veov erconsumpt ionandl ackof
awar enessoft hef ashi oni ndust rytocr eat eadi f
ficul tsetofbehav iorst ot ryt ochange.
Encour agingt heconsumert ochanget hei rf ashi onbuy ingbehav ior
Thi scompl exnat ur eoff ashi onconsumpt ionmeanst hatt her eisnotoneeasysol utiont o
mot ivatet hecust omert obuyordemandsust ainabl ef ashi onandt ext il
es.Acombi ned
appr oachbet weent heconsumerandmanuf act ur ersneedst obedev elopedi nor dert ogener ate
moment um andl ast i
ngchange.Manyst art -
upbr andsandt radi t
ional manuf act ur ersar e
dev elopi ngi nitiati
v est oencour ageconsumer st owantt obuysust ainabl ef ashi on.These
i
ncl ude:
Increasi ngawar enessandeducat i
onoft heenv ir
onment al i
mpactandconsequencesoff ast
fashi onandt hebenef itsofsust ainabl ef ashi on.
Brandsneedt ocr eat e  sust ainabl ecl ot hest hatar eal sof ashi onabl e sot hatpeopl ewantt obuy
andweart hem.Consumer swantt obuyf ashi onabl ecl ot hesandmaki ngt hisapr iorityi n
sust ainabl ypr oducedgar ment swi l
l beessent i
al tochangi ngcust omerbehav ior .
Indust ryandmanuf act urer sneedt odev elopst r
ongr ecy cl i
ngandwast er educt ionpr ogr ams
thatar eeasyf ortheconsumeruse, whi leaddr essi ngpr eandpostr ecy clingst reams.Maki ng
sur et hatgar ment sandt ex tilescanbeef fect ivelyandeasi lyr ecy cledi nt hef irstpl acei sal soi s
vital.
Dev el opi ngnewanddi ff
er entway sf orconsumer st oexper iencef ashi on.Manyeco- fashi on
focusedst ar t-upcompani esar el eadi ngt hisar ea, encour agingconsumer st ot hinkaboutt heir
fashi onbuy ingwhi leof fer inggui l
tfreesol ut ions.
Invest ingi ncampai gnsf orconsumer st ol ov et heircl ot hes, rat hert hanconst ant lybuy ingnew
ones.Campai gnssuchas  Lov eYourCl ot hes  i
nspi r econsumer st oi mpr ov et hesust ai nabi li
tyof
clothi ngacr ossi t
sl if
ecy cl e, encour agi ngcust omer st omakesmal lconsci ouschanges.
Mat erialism asaconcept  needst obeexami ned.Thi si sadi ff i
cul tt ask, butul timat elybot h
manuf act urer sandconsumer sneedt ot aker esponsi bi li
tyf ort hei rownov er-consumpt ion.
Changingconsumerbehav iorisvit
al t
or educetheenv ir
onment ali
mpactoff ashion:Ev ery one
agreesthatfastfashionleadst oenv i
ronment al
damage.Br andsandmanuf acturershav e
start
edtoaddr esst hesustainabil
it
yoft exti
l
esthrough streaml i
nedtexti
lemanuf acturi
ng  and
eco-i
nit
iati
ves,butwi t
houtget ti
ngtheconsumeronboar d, texti
l
eproductionwi llnevertruly
becomesust ai
nable.Acombi ned,i
nteracti
veandpur posef ulapproachisessent i
al-wit
houtt he
supportandchangedbehav i
ourofconsumer s,f
ashionwi l
l continuetopolluteandexpl oitt he
envir
onment .Consumer shav et hepowert odemandr eal
,ef fecti
vesust
ainabili
t yinthei
rf ashi on
andtextil
esandchangei nconsumerbuy i
ngbehav i
oristhekeyt omakingr eal changei nthe
fashi
oni ndustr
y.

2.
2Fact orsi nfl
uenci ngconsumerbehav i
or:
Psychologi cal Factors
SocialFact or s
Cultur
al Fact ors
Personal Fact ors
Economi cFact ors
Consumerbehav iour i
sinfl
uencedbymanydi f
fer
entfactor
s.Amar ket
ershouldt
ryto
understandt hef actorsthati nf
luenceconsumerbehav i
our.
 Hereare5majorfact
orsthat
i
nfluenceconsumerbehav iours: 
1.Psy chol ogicalFact ors
Humanpsy chologyi samaj ordetermi
nantofconsumerbehav i
our
.Thesefact
orsaredif
fi
cul
tto
measur ebutar epower fulenought oinfl
uenceabuyingdecision.
Someoft hei mpor t
antpsy chol ogi
calfactor
sare:

i
.Mot ivation
Whenaper soni smot i
vatedenough, itinfl
uencest hebuy ingbehav iouroftheper son.Aper son
hasmanyneedssuchast hesoci al needs, basicneeds, secur it
yneeds, esteem needsandsel f-
actualizationneeds.Outofal ltheseneeds, t
hebasi cneedsandsecur i
tyneedst akeaposi tion
abov eal lot herneeds.Hencebasi cneedsandsecur ityneedshav ethepowert omot i
vatea
consumert obuypr oduct
sandser vi
ces.
i
i.Per cept ion
Consumerper cepti
on isamaj orf actorthatinfluencesconsumerbehav iour.Customer
percept ion isapr ocesswher eacust omercol l
ectsinformat ionaboutapr oductandi nterpr
et s
theinfor mat i
ont omakeameani ngful i
mageaboutapar ti
cul arproduct.
Whenacust omerseesadv er
ti
sement s, pr
omot ions,customerr ev
iewssoci almedi afeedback,
etc.relatingt oapr oduct,theydev elopani mpr essionaboutt hepr oduct.Henceconsumer
percept ionbecomesagr eatinfluenceont hebuy i
ngdeci sionofconsumer s. 
i
ii.Lear ning
Whenaper sonbuy sapr oduct,he/ sheget st olearnsomet hingmor eaboutt heproduct .
Learningcomesov eraper iodoft imet hroughexper ience.Aconsumer ’
slearni
ngdependson
skil
lsandknowl edge.Whi leaski l
l canbegai nedthroughpr actice,knowledgecanbeacqui red
onlyt hr oughexper ience.
Lear ningcanbeei thercondi ti
onal orcogni tive.Incondi t
ional l
ear ningt heconsumeri sexposed
toasi tuat i
onr epeat edl y ,ther ebymaki ngaconsumert odev elopar esponset owar dsi t.
Wher easi ncogni tiv el ear ning, theconsumerwi llappl yhi sknowl edgeandski l
lst of ind
satisfact ionandasol ut ionf r
om t hepr oductt hathebuy s.
i
v .At ti
t udesandBel i
ef s
Consumer shav ecer tainat tit
udeandbel i
ef swhi chi nfluencet hebuy ingdeci sionsofa
consumer .Basedont hi sat ti
tude, theconsumerbehav esi napar ti
cul arwayt owar dsapr oduct .
Thisat titudepl ay sasi gni fi
cantr ol ei ndef iningt hebr andi mageofapr oduct .Hence, the
mar ket er st r
yhar dt ounder standt heat ti
tudeofaconsumert odesi gnt heirmar ket i
ng
campai gns.
2.Soci alFact or s
Humansar esoci al bei ngsandt heyl ivear oundmanypeopl ewhoi nfluencet hei rbuy ing
behav iour .Humant ryt oi mi tateot herhumansandal sowi sht obesoci allyaccept edi nthe
societ y .Hencet hei rbuy i
ngbehav iour  
isinfluencedbyot herpeopl ear oundt hem.Thesef actors
areconsi der edassoci al factor s.Someoft hesoci al fact or sar e:
i
.Fami ly
Fami lypl ay sasi gni fi
cantr olei nshapi ngt hebuy ingbehav iour  ofaper son.Aper sondev elops
prefer encesf r
om hi schi ldhoodbywat chingf ami lybuypr oduct sandcont inuest obuyt hesame
product sev enwhent heygr owup.
i
i.Ref er enceGr oups
Refer encegr oupi sagr oupofpeopl ewi thwhom aper sonassoci ateshi msel f .Gener all
y, allt
he
peopl ei nt her ef er encegr ouphav ecommonbuy ingbehav iourandi nf luenceeachot her.
i
ii.Rol esandst at us
Aper soni si nfl
uencedbyt her ol et hathehol dsi nt hesoci et y.Ifaper soni si nahi ghposi ti
on,
hisbuy ingbehav i
ourwi llbei nf l
uencedl argelybyhi sst atus.Aper sonwhoi saChi efExecut ive
Of f
iceri nacompanywi llbuyaccor dingt ohi sst at uswhi l
east afforanempl oy eeoft hesame
companywi llhav edi ffer entbuy ingpat tern. 
3.Cul t ur alf act ors
Agr oupofpeopl ear eassoci at edwi thasetofv aluesandi deol ogi est hatbel ongt oapar ticular
communi ty.Whenaper soncomesf rom apar ti
cul arcommuni t y
, his/ herbehav iour ishighl y
i
nf l
uencedbyt hecul tur er elatingt othatpar t
icularcommuni ty.Someoft hecul tural factor sar e:
i
.Cul tur e
Cultur al Fact orshav est rongi nf luenceonconsumerbuy erbehav iour . Cul tur al Fact orsincl ude
thebasi cv alues, needs, want s, pr eferences, per cept ions, andbehav iour st hatar eobser v edand
l
ear nedbyaconsumerf rom t hei rnearf ami lymember sandot heri mpor tantpeopl ear ound
them.
i
i.Subcul ture
Wi t
hi nacul tural gr oup, ther eexi stmanysubcul tur es.Thesesubcul tur al groupsshar et hesame
setofbel i
ef sandv alues.Subcul tur escanconsi stofpeopl ef rom di fferentr eligion, cast e,
geogr aphi esandnat i
onal ities.Thesesubcul turesbyi tselff orm acust omersegment .
i
ii.Soci alCl ass
Eachandev erysoci etyacr osst hegl obehasf orm ofsoci al class.Thesoci al classi snotj ust
deter mi nedbyt hei ncome, butal soot herf actor ssuchast heoccupat i
on, fami l
ybackgr ound,
andeducat ionandr esi dencel ocat ion.Soci alclassi si mpor tantt opr edi ctt heconsumer
behav iour .
4.Per sonalFact or s
Fact orst hatar eper sonal tot heconsumer sinf l
uencet hei rbuy i
ngbehav i
our .Theseper sonal
factor sdi fferf rom per sont oper son, therebypr oduci ngdi f ferentper cept ionsandconsumer
behav iour .
Someoft heper sonal fact or sar e:
i
.Age
Agei samaj orf act ort hati nfluencesbuy ingbehav iour .Thebuy ingchoi cesofy out hdifferf rom
thatofmi ddl e-agedpeopl e.El der l
ypeopl ehav eat ot allydi fferentbuy ingbehav iour.Teenager s
will bemor ei nterest edi nbuy ingcol our ful cl ot hesandbeaut ypr oduct s.Mi ddl e-agedar e
focusedonhouse, pr oper tyandv ehi clef ort hef ami ly.
i
i.I ncome
Incomehast heabi lit
yt oi nfluencet hebuy ingbehav i
ourofaper son.Hi gheri ncomegi v eshi gher
pur chasi ngpowert oconsumer s.Whenaconsumerhashi gherdi sposabl eincome, i
tgi vesmor e
oppor t
uni tyf ort heconsumert ospendonl uxur iouspr oduct s.Wher easl ow-incomeormi ddle-
i
ncomegr oupconsumer sspendmostoft hei ri ncomeonbasi cneedssuchasgr oceriesand
clot hes.
i
ii.Occupat ion
Occupat i
onofaconsumeri nf l
uencest hebuy i
ngbehav i
our .Aper sont endst obuyt hi
ngst hat
areappr opr iat etot hi s/herpr ofessi on.Forexampl e, adoct orwoul dbuycl othesaccor dingt o
thispr of essionwhi leapr of essorwi l
l hav edi ffer entbuy ingpat ter n.
i
v .Li fest yle
Lifest y l
ei sanat ti
tude, andawayi nwhi chani ndividual st ayi nt hesoci ety.Thebuy ing
behav i
ouri shi ghlyi nf l
uencedbyt hel i
fest yleofaconsumer .Forexampl ewhenaconsumer
l
eadsaheal thyl i
fest y l
e,thent hepr oduct shebuy swi l
l relat et oheal thyal ternat i
vest oj unkf ood.
5.Economi cFact or s
Theconsumerbuy i
nghabi tsanddeci sionsgr eat l
ydependont heeconomi csi tuationofa
count ryoramar ket .Whenanat i
oni spr osper ous, theeconomyi sst r
ong, whi chl eadst ot he
great ermoneysuppl yi nthemar ketandhi gherpur chasi ngpowerf orconsumer s.When
consumer sexper ienceaposi tiveeconomi cenv ironment , theyar emor econf identt ospendon
buy ingpr oduct s.
Wher eas, aweakeconomyr eflectsast ruggl ingmar kett hati si mpact edbyunempl oymentand
l
owerpur chasi ngpower .
Economi cf act orsbearasi gni ficanti nfluenceont hebuy ingdeci sionofaconsumer .Someof
thei mpor tanteconomi cf actor sar e:
i
.Per sonalI ncome
Whenaper sonhasahi gherdi sposabl ei ncome, t
hepur chasi ngpoweri ncr easessi mul taneousl y.
Disposabl eincomer efer stot hemoneyt hati sl eftaf terspendi ngt owar dst hebasi cneedsofa
per son.
Whent her eisani ncr easei ndi sposabl ei ncome, i
tl eadst ohi gherexpendi tureonv ari
ousi tems.
Butwhent hedi sposabl ei ncomer educes, par allelthespendi ngonmul tiplei temsal sor educed.
i
i.Fami lyI ncome
Fami lyi ncomei st het otal i
ncomef rom al lt hemember sofaf ami ly.Whenmor epeopl ear e
ear ningi nt hef ami l
y ,therei smor ei ncomeav ailablef orshoppi ngbasi cneedsandl uxur i
es.
Higherf ami lyi ncomei nf l
uencest hepeopl ei nt hef ami lyt obuymor e.Whent her eisasur plus
i
ncomeav ailablef ort hef ami ly,thet endencyi st obuymor el uxur yitemswhi chot herwisea
per sonmi ghtnothav ebeenabl et obuy .
i
ii.ConsumerCr edit
Whenaconsumeri sof feredeasycr edi tt opur chasegoods, itpr omot eshi gherspendi ng.Sel l
ers
aremaki ngi teasyf ort heconsumer st oav ail credi tint hef or m ofcr edi tcar ds, easyi nst alment s,
bankl oans, hirepur chase, andmanysuchot hercr edi topt ions.Whent her eishi ghercr edit
av ailabl et oconsumer s,thepur chaseofcomf or tandl uxur yi temsi ncr eases.
i
v .Li qui dAsset s 
Consumer swhohav el i
qui dasset st endt ospendmor eoncomf or tandl uxuries.Li quidasset s
aret hoseasset s,whi chcanbeconv er tedi nt ocashv er yeasi l
y .Cashi nhand, banksav i
ngsand
secur iti
esar esomeexampl esofl iqui dasset s.Whenaconsumerhashi gherl i
qui dasset s, i
t
giveshi m mor econf idencet obuyl uxur ygoods.
v.Savi
ngs
Aconsumerishighlyi
nfl
uencedbytheamountofsavi
ngshe/shewishestosetasi
defrom hi
s
i
ncome.Ifaconsumerdecidedtosavemore,t
henhisexpendi
tur
eonbuy i
ngreduces.I
fa
consumeri
sinterest
edinsavi
ngmor e,
thenmostofhi
sincomewi l
lgotowardsbuyi
ngproducts.

2.
3Buy i
ngPr ocessandTy pesofbuy ers
Merchandisebuy ingandhol di
ngisav italpartofi
mpl
ement i
ngmer
chandi
sepl
ans.
Thisi
sast epbyst eppr ocessandi nvolvesfoll
owi
ngstages:
(i
)Coll
ecti
ngi nformat i
on,
(i
i
)Selecti
ngv endor s,
(i
i
i)Eval
uat i
ngmer chandise,
(i
v)Negotiationwi thv endors,
(v
)Buy i
ngmer chandise,
(vi
)Receivingandst ockingmer chandise,
(v
ii
)Re-order i
ng, and
(v
ii
i)Re-evaluat i
ng, asment ionedinfi
gur e11.1

Thesest epsar eexplainedi ndetai lbelow:

1.Collecti
ngI nformat i
on: Thisisav eryfir
stst epofmer chandisebuyi
ngprocess.Oncet he
fi
rm’sov erallmer chandisepl ansar edef i
ned, exactinformat i
onaboutcurr
entmar ketneedsand
potentialvendor sisrequired.
Thisisessent ialasar etailerbeforebuy i
ngmer chandisewoul dliket
oknow:
(i)Whatconsumer sar elookingf or ,
(i
i)Wher ethev endor sarel ocatedandwhati st hei
rgoodwi l
linthemarket
,and
(i
ii
)Whatt hei rcompet it
orsar eof fering.Afterunderstandi ngtheseaspect
s,ret
ail
erwillbeina
posit
iont odeci dewhathewant st obuyandf rom whom.
Forcol l
ectinginformation, aretail
er /buyerhassev eral possiblesour
cesdefi
nedasi nt
ernaland
exter
nal sources.
Itdependsont her et ail
er( buy er )whi chsour cehewoul dl iket ochoose.Nor mal ly, global
retai l
er sr elyonbot hi nter nal andext er nal sour cest ohav et hebet terpi ct ureofconsumer s’
requi rement s.Undoubt edl y, themostv aluabl esour cei sthe‘ studyofconsumer s’ .Vendor s
(manuf act urer sandwhol esal ers) ,ont heot herhand, dot hei rownpr oject ionsaboutt hef ut ure
salesandmar ketdemand, whi lef inalizingt he‘ buy i
ngdeal ’ wi thr et ail
er s.Vendor spr esentt hese
proj ect ionst hr oughpi e-char ts, bar -diagr amsandv ari
oust woand/ort hreedi mensi onal char ts.
Theyal soi nf ormt her et ailer showmuchpr omot i
onal suppor twi l
l bepr ov i
dedt ot hem whi ch
mayhav emaj ori mpactonr etailer s’buy ingdeci sion.Butr et ailer smustunder standonet hing
thatt heyar et heonewhohav et oi nter actwi t
ht hecust omer sandar er esponsi blef orsat isf y
ing
theneedsoft het argetmar ket .Ther efor e,theyshoul dnotdependonv endor s’pr oj ect i
onsonl y,
butmayuset hem f orr ef er ence.
Asr et ailer sar eent i
relyr esponsi bl eforcompl etesalespr oject i
onsandmer chandi sepl ansi n
theirowncat egor y, t
heyshoul ddi rectt heirsal es’ empl oyeest ogetav i
ewofcust omer s’
pot ent ial demandbyv isit i
ngsuppl iers,talkingwi t
hsal es’ exper tsandobser vingconsumer
behav ior .Besi dest hisdat apr ov idedbyt radeassoci ations, gov er nmentbodi espr oj ectsl ike
ASSOCHAM, FI CCIbul l
et insmaybeconsul ted.Internethasal sobecomeav i
tal sour cef or
collect ingi nf or mat i
onandi sal sot imesav ing.
Ret ailer smayusecol l
ect edi nfor mat i
onf ormaki ngmer chandi sedeci sionsabout( i)st aple
mer chandi seand( ii)fashi onmer chandi se.Theabov e-ment ionedsour cesar eenought ohav e
pictur eaboutst apl emer chandi sebutf orf requent lychangi ngf ashi onmer chandi se, ami xof
i
nt er nal andext er nal sour cesmaybeused.
2. Sel ect i
ngVendor s: Af tercol l
ect ingt hei nformat ionaboutconsumer s’ demands, thenextst ep
i
st osel ectsour cesofmer chandi seandt oi nteractwi ththem t osel ectt hepot ent ial vendor s.
Forsel ect i
ngv endor s,ther et ailer susual lyhav ethreeal ter nat iv es:
(i) 
Company -ownedv endor s:Ast hev erynamei mplies,thesev endor sar eownedbyt he
companyt hemsel v es.Lar ger etai l
er shav et heirownmanuf act ur i
ngorwhol esal eoper ations.
Theywor konl yf orpar t
icul arr et ailersandpr ov i
deaspert hei rr equi rement s.
(ii
) Ext er nal,wi del yusedsuppl ier :Thi st ypeofsuppl i
erisnotownedbyt her etailerbutused
frequent l
ybyhi m.Ther et ai l
eri sbuy ingmer chandi seforl ongandi sawar eaboutt hequal ityand
ser vicesof fer edbyhi m.
(ii
i) Ext er nal ,notusedsuppl ier:Thi st ypeofr etailerhasnotbeenusedbyt her et ailerashei s
eitheranewent rantorr et ailerhasnotpur chasedany t
hingf r om hi m sof ar.Ther ef ore, what
qual ityhei sof fer i
ngcannotbeknowni nadv ance.Ret ail
er smayuseanyonet ypeofsuppl ieras
pert hei rr equi rement s, budgetandar eaofoper ati
onsort heycanuseacombi nat ionoft hem.
Bigr etai lersof tendeal wi thal lty pesofsuppl iers.Ther efor e, aft ersel ect i
ngt hesuppl i
er
cat egor y ,ar et ailershoul di nt eractwi tht hem aboutt hebuy ingt er msandcondi ti
ons.

Foll
owi
ngpoi nt
smustbeconsi deredwhilesel
ecti
ngthevendor
s:
(i
)Goodwil
l oft
hev endorinthemar ket.
(i
i
)Guarant
eeand/ orwarrantyoff
erings.
(i
i
i)Whi
chv endoroffer
smer chandiseatthelowestt
otal
cost?
(i
v )Qual ityof f
er edbyt hev endor
(v)Wi llthev endorpr ov i
det r anspor tst or ingandot herf acilities?
(vi)I sv endor ’smer chandi sel ineconser v at i
v eori nnov ative?
( vii
)I sv endorof feringcr edi tpur chase?
(viii
)Whatpr omot i
onal suppor tispr ov i
dedbyt hev endor ?
(i
x)Wi llmar k-upbesuf ficient ?
(x)I sv endori nt erest edorwi llbeav ailabl ef orl ongt er mr el ations?
(xi)Wi llvendorf ulfi
ll whathehasagr eedupon?
(xii)Wi l
l vendorpr ov i
decondi tional /excl usi vesel lingr ight s?
( xii
i)Howqui ckwi l
l order sbedel iver ed?
3. Ev aluat ingMer chandi se: Af terdeci dingupont hesour ceofmer chandi se, nextst epi st o
ev aluat et hev endor ’
smer chandi sequal ity .
Her e,ar etai leri sencount er edwi thf ollowi ngsi tuat i
ons:
(i
)Whet hert hewhol el otbeexami ned, or
(i
i)Pur chasi ngbemadeonl yonv endor ’sdescr i
pt ion.
Ret aileraf teri nt er act i
ngwi thsuppl ier sshoul dev al uat emer chandi seunderpur chase
consi der ation.Shoul deachuni tofmer chandi sebeex ami ned?Ori temsshoul dbebought
onl yont hebasi sofdescr i
pt ionanddemonst rat ionspr esent edbyt hesuppl iers.
Forev aluat i
ngmer chandi sei tems, ret ailerhast hr eechoi cesi nhand:
1.I nspect ion
2.Sampl ingand
3.Descr ipt ion
Whi chmet hodshoul dbef ol l
oweddependsont hei tems’ feat ur es, costandt hef requencyof
pur chase.I nspect i
oni sapr ocessofexami ningeachi tem ofmer chandi set hor oughl ybef oret he
mer chandi sepr ocur ementandal soaf terdel i
v ery .Jewel lery( diamond, gol d, plat i
num andot her
pr eciousst ones)i soneoft heexampl eswher er et ai l
eri nspect sal lt heitemsofpur chase.
Sampl ingt echni quei susedwhenr et aileri sbuy i
ngi temsonr egul arbasi sinl argequant itythat
i
sper i
shabl e, br eakabl eorcost l
yones.Ther efor e, ret ailerusesAccept anceSampl i
ngmet hod.I t
i
s“ themi ddl eoft her oad”appr oacht hatexer cisescont rol ov ert hei ncomi ngi nv ent orywi thout
goi ngt hrough100%i nspect ion.I tsi mpl ymeansaccept ingorr eject ingt hesuppl i
er ’
s
mer chandi seassor tment .
Her edeci sioni st akenwi t houtgoi ngt hr ough100%i nspect i
onoft heent irel ot .Itisa
compr omi sebet weennoi nspect ionand100%i nspect i
on.I thast wokeycl assi fi
cat ionsof
accept ancepl ans: f
irstlybyat tribut es( “go, no- go” )andsecondl ybyv ariables.
Descr iptionbuy ingi sapr ocessofmer chandi sepur chasewher ear etaileror der sthe
mer chandi sei t emsaf t
ergoi ngt hr oughsuppl ier ’
spi ct or i
al cat aloguement ioni ngt hepr oduct
feat ures, pr i
ce, si zeandot herr el ev antdet ail
s.Fori nst ance, ar etai l
ercanor derf oodand
clot hingi t
emsf rom acat alogueorconcer nedcompanywebsi te.Onr ecei ptofi tems, theyar e
onl ycount edf ormat chi ngor dersi ze.
4.Negot i
at ion: Oncet her et ailerhasev al uat edt hemer chandi sequal i
tyandot herf eat ur es, he
negot iateswi t
ht hev endorf ori tspr iceandconsequentt ermsandcondi ti
ons.Bot hpar ties
l
ist ent oeachot hercar eful l
yandaskquest ionswher ev erdoubtar ises.Ter msandcondi ti
ons
ar et hendeci dedandcont racti smadei nv olvingt ot al amountt obepai dbyt her etai l
er ,del i
v ery
dat e, deliv er ycondi tionsandot herl egal aspect s.Ret ailerswhi lenegot iatingal sot alkaboutt he
condi ti
onsf ort her e-order .UnderNegot iationst age, retai l
erbar gai nswi tht hesuppl ierf or
av ailabl edi scount sandcondi ti
onsofpur chase.Ar et ai l
erwoul dl iket oknowwhatwi l
lbet he
addi t
ional di scounti fhegoesf orbul kbuy i
ng.Whati scashdi scount ?Whati st radingdi scount
et c?I st her esomeof f-
seasondi scount ?Oncet hemer chandi sei snegot iatedf ori tsqual it
y,
quant ityandpr ice, retailerpl acest heor derandconcl udest hebuy ingexer ci sebypay i
ngt he
amountdue.Ther etai l
ert akest het itleofi temsi mmedi atel yaf tert hepur chase.
5. Buy i
ngMer chandi se: Af ternegot iat i
ngt het er msandcondi tionsandagr eeduponpr ice, a
ret aileraf terpl aci ngt hesi zeoft heor der( quant ityandqual ityofeachmer chandi secat egor y),
pay st hei nitial moneyaspert heagr eement .Bi gr et ai
ler susual lypl acet heor derandpayt he
billsonl inet hr oughel ect roni cdat ai nt erchange( EDI )andqui ckr esponse( QR)I nv ent or y
planni ng, smal l ret ailer sduet ol imi tedsour ces, concl udepur chasemanual l
y .Theyf i
llupt he
or derf orm anddeposi ti tper sonal lyort hr oughpost age.Wi tht het echnol ogical adv ancement
andeasyaccesst oi nter netf aci li
ty ,ret ailerspl acet hei ror der sonl ine.Thesmal l ret ail
erswho
areassoci atedwi thbi gv endor sal sopayt hei rbi llsandpr ocessor der st hr oughEDIandQR
sy st emsasperpol i
cymat ter s.
6. Acqui ri
ngMer chandi se: Itmeansaf terpay ingf ort hei nv oices, ret ailershoul dr ecei vethe
mer chandi seandst ocki tpr oper l
y .Whi leacqui ringt hemer chandi se, retailerphy si cal l
yr eceive
thei tems, count st hesuppl i
es, pay st hei nv oices, mar kst hei tems, di spl ay st hei temsandst ock
i
ngodowns/ war ehousest oav oidanypi l
fer ageanddamage.I ncaseofcent ralizedbuy i
ng,
goodsar er ecei vedbyr egi onal of fice/ cent ral war ehouseandt hent ransf erredt ochai nst oresas
pert hei rr equi r ement sandor derr ecei vedf rom t hem.Af terpay ingt hesuppl iers’ bi l
ls,retai l
er
makespr ov isi onhowandwher et hei temsshoul dber ecei vedandst ocked.I temsshoul d
direct l
ysuppl i
edt ost or eorwar ehouse, i
sment ionedatt het imeofnegot iationand
mer chandi sepay ment s.Oncet hei temsar er ecei ved, retai l
ernextst epi st omakeensur et hat
thei temsar est ockedpr oper ly.Somet i
mesi tmayt akel ongt imet or eachf rom war ehouset o
stor e, ther ef or e, whenor der sar er ecei v ed, theymustbecheckedf ori tsquant ityandqual ity.
Inv oi cesmustbecar ef ullycheckedf ori tsdescr iptionandamountpr intedt oav oi dany
conf usi onwi thsuppl ierl at eron.Whent hemer chandi sehasbeenpr ocur edandst ocked, itwill
bei ssuedt ost ore/ swhenev erdemandper tains.Ther efor e, retai lershoul dhav eaney eon
mer chandi sei ssuedandt hei temsl ef tint hest ock.Whenev ert hel ev el ofi nv ent or ycomes
closet or eor derl ev el, goodsar eor der edf orf reshsuppl ies.Onceamer chandi sepl ani s
i
mpl ement ed, itshoul dber e-ev al uat edatr egul ari nter val oft imebycl osemoni tor ingof
i
mpl ement at i
onpl anwi tht heobj ect i
v eofsat isf yingconsumer s.I ncaseofcent ral buy ing,
dist ribut i
onmanagementi st hekeyt ost or eper for mance.Buy ers/ concer nedst af fshoul dt ake
car ewhi leshi ftingmer chandi set ochai nst or esorwar ehouses.
Fol lowi ngpr ecaut ionsmustbet akenundert hi sst age:
(i)Inspectt hei nv oi cesphy sical lyf ori tsaccur acy .Oncet hei nv oicesar esi gnedandpai d, vendor
wi llnotber esponsi bl ef oranyl ossi nt ransi tori ncaseofmi ssi ngi tems.Ther ef or e, whenor ders
arer ecei v ed, theymustbet hor oughl ycheckedf orsi zeofor derpl acedandany
br eakage/ pil
f er agedur ingt ransi t.
(ii
)Whi leunl oadi ngmer chandi se, takepr ecaut i
onst hatt hei rpacki ngshoul dnotspoi l
.Fur ther,
keept hei temsatdi stanceandatpr operpl aceasunl oadi nggener al lycausesbr eakageand
mi xi ngofi temswi thoneanot her .
Ty pesofbuy er s: Wi t houtcl othi ngwecannoti magi neaci v i
lizedsoci ety.Wi tht hei ncr easeof
wor ldpopul at ion, clot hingdemandi si ncr easi ngsi gnif i
cant l
y .Inal l fashi onbr andsi nt hewor l
d,
abuy eri sakeyper sonf orpur chasedeci sions.
Ther ear et wot y pesofbuy er si nt hef ashi onbusi nesswor ld.
Di rectbuy er
SMSbuy er
Di rectBuy er
Di rectbuy er sbuypr oduct sdi rect l
yf rom t hei mpor ter, tr
adi nghouse, ormanuf act ur er.They
direct l
ynegot iat epr iceswi tht hesuppl iersandmakeabuy ingdeci si on.Theybuygoodsbased
ont hef or ecast ing( pr ev ioussal esdat a)oft hest y l
eandpl aceanor derwi t
hcol or , size,and
exactquant ity .
SMSBuy er
SMSmeansSal esManSampl e.SMSbuy eral way sneedssal esmansampl et oshowt hei r
cust omer ssot hatcust omer scant aket hedeci si ont obuyt hepr oductbyseei ngt heor i
gi nal
sampl e.
Af
terconf
ir
mingSMSst
ylebuy
erneedsampl
i
ngasbel
ow:
Si
mil
arfabr
icandav
ailabletr
ims/
accessori
es.
Pr
otosampl
e
Pr
otosamplemeansinit
ialsampl
eforfi
tti
ngandmeasur
ementcheck.

Actual
fabr
icandact
ualt
ri
ms/ accessor
iesneedt
omakephot
osampl
esi
nce,
it
Phot
osampl
e
wil
lbeusedforpr
omoti
onalacti
vit
ies.

Aft
erapprovi
ngt
hephotosampleSMSsampl eisneededasperbuyerr
equi
red
SMSsampl
e quanti
tywit
hact
ual
fabri
candactualt
ri
ms/accessori
essi
nceitwil
lbeusedfor
sel
li
ngpurposet
ocoll
ector
derbythesal
esman.
Ret
ailMer
chandi
sing

3.1Ret ai
lMer chandi si
ng:Ret ai
lMer chandisi
ngr efer
stothev ari
ousactivi
tieswhichcont ri
bute
tothesal eofpr oduct stotheconsumer sfortheirenduse.Everyret
ailstorehasi t
sownl i
neof
mer chandiset ooffert othecustomer s.Thedisplayofthemer chandi
sepl aysani mpor t
antr ol
e
i
nat tracti
ngt hecust omer si
ntot hest or
eandpr ompt i
ngthem topurchaseaswel l
.
Mer chandisinghelpsi ntheattractivedispl
ayoft heproductsatthestoreinor dert
oi ncrease
theirsaleandgener aterevenuesf ortheretai
lstore.Merchandisi
nghelpsint hesensi bl
e
presentationoft hepr oductsavailableforsal
etoent i
cethecust omersandmaket hem abr and
l
oy ali
st.

3.
2Coor
dinat
ionandPl
anni
ng

Retai
l
ingisdefi
nedast heprocessofsel
li
ngmerchandiset
otheconsumersf
orthei
rendusein
smallquant
it
ies.Theretai
l
ersell
sproduct
stot
heend- user
seit
heri
nsingl
eunit
sorinsmall
quanti
ti
esaspert hei
rneedandcapabil
it
y.

Howdoesr etail wor k?

Letusnowunder standt hev ariousway saconsumercanpur chasegoodsf rom t her etai
ler.
Count erser v i
ce
Ast henamesuggest s, count erservi
cer eferst othepr ocessofpr ocur ingt hemer chandi sef rom
thecount er.Thebuy erdoesnothav eaneasyaccesst ot hemer chandi seoft hest oreandhe
can’tpi ckupt hingsonhi sown.I nsuchamechani sm t hebuy erhast owal kupt ot hecount er
andaskf orhi sr equirement s.
Exampl e
Jewel ler ySt ore
Cany ougot oaj ewel ler ystoreandpi ckupt hingsony ourown?No
Youneedt oaskt hesal esper sont oshowy out hesampl edesi gnsf ory out of i
nalizesomet hing
aspery ourt ast eandpocket .
Chemi stShop
Chemi stshopdoesnotal l
owt hebuy erstosi mpl ywal ki ntot hest oreandpi ckupmedi cines.
Oneneedst owal kupt ot hecount er,showhi spr escr ipti
onf rom thedoct ortogett hemedi ci nes
from ther etailer .
Del i
verySer vi
ce
Themechani sm ofshi ppinggoodst ot hecust omer ’
sdoor stepsi scal l
edasdel i
ver yser vice.
Theend- userdoesnothav et owal kupt othest or et opr ocur ehi smer chandi se; i
nst eadt he
goodsar edi rect lydel i
v eredtohi shouset hroughv ariousmeansoft ranspor tation.Del i
very
ser v
icei saboonf ort hei ndividual
swhohav eanext remel ybusyl ifest yleanddonothav e
enought imet owal kupt othest ore.
Onl i
neShoppi ng
Internethashel pedend- userst oshopf rom thei rhomesonl y.Onl i
neshoppi ngsi tesl ikeAmazon,
eBayet cpr ov ideawi der angeofopt ionst otheconsumer swhocanor dert hedesi red
mer chandi set hr oughi nternet.Oncet hepay menti sdonet hroughdebi torcr edi tcar ds, t
he
goodsar edel iv eredatt headdr essthecust omerr equest sf or.Thet ranspor tat i
onchar ges
howev erar ebor nebyt heconsumerhi msel f.
Or derthr ought elephone
Nowaday ssev er alrest aurantsandeat i
ngjointspr ov ideanopt i
onofor deringf oodwhi lesit ti
ng
athome.Thef oodout l
et suploadt heircompl etemenui nt hewebsi tepr ov i
di ngawi der angeof
opt i
onst ot heend- user s.Onecaneasi l
yplacehi sor derov ert hephoneandt hef oodi sdel i
v ered
athi sdoor stepwi thi
nnot i
me.
PizzaHut ,Domi nos( Promiset odel i
verhotandcr isppizzawi thi
n30mi nut esofplacingt he
order)
DoorToDoorSal es:  
Doort odoorsal esisapr ocesswher ethesalespersont r
av elsfrom one
houset otheot herandpr ompt sthecust omer stobuyt hepr oduct
.Hegiv esthedemoofhi s
productandst riveshar dtoconv incet heindivi
dualtobuyt hemer chandi
se.
Exampl es
EurekaFor besoper atesont hi
smechani sm whereexper iencedsalesprofessional vi
sitsthe
doorstepsoft hepot enti
alcustomer s,givesthem presentationsandinfl
uencest hem to
purchaset heproduct .
Telephonecompani esalsosomet imesr elyonthismechani sm tosellt
hei rconnect i
ons.
SelfService:
 I
nsel f-
servi
cet heindivi
dual shavethelibertytopickupmer chandi seont hei
rown
andhel pthemsel v es.
SecondHandRet ail
: I
nsecondhandr et
ailshopsther etail
ersell
ssecondhandgoodst otheend
-users.Suchshopsgener al
lyrunf orchar i
tywherepeopl edonat ethei
rusedmer chandi set obe
resoldtothepoorandneedyf reeofcost .

3.
3Sampl
i
ng,
cost
ing:
Thesal
eofgoodsf
rom f
ixedpoi
nts(
mal
l
s,depar
tmentst
ores,
super
mar
ket
s
andsoon)t otheconsumeri
nsmal l
quanti
ti
esforhi
sownconsumpti
oniscal
l
edasret
ail
.Accor
dingt
o
theconceptofret
ail
i
ng,aret
ail
erdoesn’
tsel
lpr
oductsi
nbul
k;i
nsteadsel
l
sthemer
chandisei
nsmall
unit
stotheend-user
s.

CostPl usPr icingMechani sm

Everyor gani zat i
onr unst oear npr of i
tsandsoi sther etailindust ry.
Costpl uspr i
cingwor ksont hef ollowingpr i
nci ple:
CostPr iceoft hepr oduct+Pr ofit(Deci dedbyt her etailer)=Fi nalpriceoft hemer chandi se.
Accor dingt ocostpl uspr icingst rategyt her etai l
eraddssomeext raamountt ot heact ual cost
pri
ceoft hepr oductt oear nhi sshar eofpr ofits.Thef inalpr iceoft hemer chandi sei ncludest he
profi
tasdeci dedbyt her etai l
er .
CostPl usPr icing
Costpl uspr i
cingst rategyt akesi nt oaccountt hepr of itoft her etail
er.
Costpl uspr i
cingi saneasywayt ocal cul atet hepr i
ceoft hemer chandi se.
Theincr easei nt heretail
erpr iceoft hemer chandi sei sdi rect l
ypr oporti
onal tothei ncreasei n
thecostpr ice.
Thecust omer showev erdonothav easayi ncostpl uspr icing.
Manuf act urerSuggest edRet ailPr i
ce( Al socal l
edLi stPr iceorRecommendedr etailprice)
Accor dingt omanuf acturersuggest edr etailpr icingst rat
egyt her etail
erset st hefinal pri
ceof
themer chandi seassuggest edbyt hemanuf act urer.
MSRP
Ther etailersel lshismer chandi seatapr icesuggest edbyt hemanuf acturer .
Condi ti
on1
Ther etailersel lsthepr oductatt hesamepr i
ceassuggest edbyt hemanuf acturer.
Condi ti
on2
Ther etailersel lsthemer chandi seatapr i
cel esst hanwhatwassuggest edbyt hemanuf acturer
-Suchacondi tionar i
seswhent her etai l
erof fers“ Sal e”onhi smer chandise.
Condi ti
on3
Retail
ersi nitiallyquoteanunr easonabl yhi ghpr iceandt henr educet hepr iceont hecust omer ’
s
requestt omakehi mr ealizet hataf avorhasbeendonet ohi m.Acondi tionofBar gain-wher e
thecust omernegot iateswi tht her etailert or educet hepr iceoft hemer chandi se.
Compet it
ivePr ici
ng
Thecutt hroatcompet iti
oni nt hecur rentr etail scenar i
ohaspr ompt edt her etail
er stoguar antee
excel lentcust omerser vicet ot hebuy ersf orthem t opr eferthem ov erthei rcompet it
ors.
Thepr i
ceoft hemer chandi sei smor eorl esssi mi l
artot hecompet it
or’sbutt her et
ailersaddon
certainat tract ivebenef itsf ort hecust omer s.(Longerpay mentt er
m, giftset c.)
Ther etail
er sensur et hatt hecust omer sleav ethei rstorewi t
hasmi l
etohav eanedgeov erthe
compet i
tors.
Het rieshi sl ev elbestt oof f
erbet terser vicest ot hecust omer sf orabet terbusi nessi nfuture.
PricingBel owCompet it
ion
Accor dingt opr i
cingbel owcompet i
tionpol i
cy
Thepr i
ceoft hemer chandi sei skeptl essert hanwhati sbeingof f
eredbyt hecompet i
tors.
Prest igePr icing( Pricingabov ecompet i
ti
on)
Accor dingt opr estigepr icingmechani sm, thepr i
ceoft hemer chandisei ssetsl i
ghtlyabov ethe
compet i
tors.
Ther etail
ercanchar gehi gherpr icet hant hecompet itorsonlyundert hef oll
owi ng
ci
rcumst ances:
Exclusi veBr andsatt hest ore.
Brandi mageoft hest ore
Primel ocat ionoft her etai lstor e
excel lentcust omerser vice
Mer chandi senotav ailabl eatanyot herst ore
LatestTr ends
Psy chol ogical Pr icing
Cer t
ai npr i
ceofapr oductatwhi cht heconsumerwi l
l
ingl ypurchasesi tiscal ledpsy chological
pri
ce.
Theconsumerper ceiv essuchpr i
cest obecor rect.
Ar etai l
erset sapsy chol ogi cal pr i
cewhi chhef eelswoul dmeett heexpect ationsoft hebuy ers
andt heywoul deasi lybuyt hemer chandi se.
Mul ti
pl ePr icing
Accor dingt omul t i
plepr icing, ther etai l
ersel l
smul ti
plepr oduct s(mor ethanone)f orasi ngle
pri
ce.
Ther etail
er scombi nef ewpr oduct st obesol dforasi ngl efi
xedpr i
ce.
3Shi rt sforRs. 100/ -or3Per fumesf orRs20/ -andsoon.
DiscountPr icing
Accor dingt odi scountpr icing, ther etai l
ersellshi smer chandiseatadi scount edpricedur i
ngoff
seasonsort ocl earouthi sst ock.

3.4Ret ail
 
ProductLifecycleManagement  
(RetailPLM),whichisaproductwor kfl
owsol uti
on,is
av erycommonsol utionconsideredbyt heretaili
ndust
ry.Inmostcases, ret
ailPLM isdesigned
toassistbuy ers,merchandisers,qual
it
y,suppliercompli
anceandsour cingteamsi nthe
dev el
opmentofpr i
vate-
labelproducts.Retai
lPLM combi nesmechani cal,
electr
icaland
softwar eengineeri
ngwi t
ht heuseofcomput er-ai
dedcri
ticalpathmanagementandwor kf
low
processest hatcangener atelargeamount sofdat ausedt of
ur t
heropti
mizepr i
vate-l
abel
productdev elopment.
However
,theri
gidst
ruct
ureoft
heseheavi
lyupfrontdesi
gnsy st
ems,whi
chwer
ecr
eat
edi
n
1985,
havelaggedbehi
ndtheact
ualneedsoftoday’sret
ail
industr
y.

LegacyretailPLM sol uti

ons:LegacyPLM solut
ionsar ebasedont hetradi
ti
onalretailbusiness
models,coined“ t
heproductli
fecycl
e,”i
nwhichret ai
lerscommunicateandcol l
aborateinternall
y
aboutnewpr oductconcept sandareabletoseet heseconceptsthroughtheireventualdesi gn.
Whent hetraditional
retailPLM sol
uti
onswerecr eated,ret
ail“
pri
vatelabel
”wasr elati
velynew,
andPLM sol utionsdev el
opedinthe1980sf i
tperfectlytoenabl
efasterconcepttodesi gnf or
thel
imitedandsmal lscalepriv
ate-l
abeloper
ati
on.

Howev er
,fastf
orwardtot oday’
swor ld,whatweareseei
ngi shugeexpansionforr
etai
lpri
vate
l
abel—mor ethan50per centmar ketshareinpar
tsofEuropeandov er20percentmarketshar
e
i
nt heUnit
edStates.Today ’
sret
ailindustr
yseespri
vate-
labelpr
oductdevelopmentasthei
r
t
icketnotonlyt
okeepandgr owt heircust
omerbase,butalsothei
rprofi
ts.
Trueconceptt odeliveryli
fecyclesoluti
ons:Theretail
industryandi t
sbelovedpriv
atelabel has
evolv
edagr eatdealsincethe1980sandwi ththeseadv ancement sspawnednewt echnol ogies
forproductdev el
opment ,productmanagement ,sourci
ng, qualit
yassuranceandsuppl i
er
management .Theseadv ancescov erconcepttodesign,muchl i
ketheorigi
nalr
etailPLM
solut
ions,butthelatestinnovati
onsal sogomuchdeepercov eri
ngallneedsinthe“end-to-end”
productli
fecycleprocess.LegacyPLM sol uti
onsstopatacer tai
npointveryearl
yinthepr oduct
l
ifecycl
e,andf ewactuallygot hr
ought oproductdeli
verystageandcov ersour
cing,quotations,
sampl emanagement ,quali
tyassurance,suppl
iermanagementandsuppl ychai
nst opsalong
theway .

Buy erbeware:Trueend-to-end(conceptt odeliver

y)pr oductl i
fecycl
emanagementsol uti
ons
canbehar dtofi
ndduet ot henatureoft helegacysof twarebusi ness.Legacysof tware
compani esthatbuil
ttheirbusinessonPLM sol uti
onshav eaddednewf eatures/f
unct i
onsand
i
nt egrat
edotherlegacysof twarepiecesov ertheyear s.Theseconsi stofami xofi ndivi
dual
piecesresult
ingfrom yearsofdev elopment —meani ngt heyar efragmented,maskweaknesses
andgi vetheappearanceofanend- to-endsoluti
on.Pi ecesont opofpiecesar eattachedtoeach
other—init
ial
l
yshowi nganaccept abl eanswert othecompl icatedret
ailproductli
fecycle
process—butt hi
sdoesnotmeant hesepi eceswor kwel ltogetherandev entuall
ywi l
lhavea
negat i
veimpactont hecommuni cationandcol l
abor ati
ont hatthesy st
em canof fer.

Doconcept
stodel
iv
ersol
uti
onsr
eal
l
yexi
st?

End-to-end,conceptt odeliversoluti
onsdoexi standar efl
exible,upgradabl
e,lar
gescal e,
user -
fr
iendly,SaaS( sof twareasaser vi
ce)pl atf
ormst hatcanof f
ermanagementofl argeamount sof
data,spanningacr ossmul t
ipl
er etai
lteamsandul ti
mat el
ybr i
dgingthegapswi t
hintheend- t
o-
endpr oductlifecy cl
eprocess.Unl ikelegacyPLM sol ut
ionsiniti
all
ydesignedtocov ermultipl
e
i
ndust ri
es(aut omot i
ve,aerospace, r
etail,
appar el
,footwear,heavymachi nery,
etc.),t
oday’
s
i
nnov ativesolutionsar euniquelydesi gnedt ocoverasi ngl
ei ndustry’
suniquechallengesandbe
along-term answert oaspeci f
icindustry,whichhasal waysbeendr iv
ingforcebehindthe
developmentoft heCBXr etai
lcloudpl atf
orm.

Asr etailer
sscalethei
rpr ivate-
labeloperati
ons,
theymustl ooktowar dthelat
estinretai
lPLM
technol ogi
esthatwillprovideindustry-
leadingt
oolstomanaget hei nfl
uxofproduct
managementneeds, ani ncreasei nt
heamountofsuppl i
esmanagedt heneedforgreaterqual
i
ty
compl ianceandanov erallincreaseinthesuppl
ierandfactorysourcesneeded.Ther etai
l
i
ndust rywi l
lneedtoseekonesol uti
onthatcanmanagedev el
opmentandpr oducti
on,allt
he
wayt hroughsour ci
ng, qualityanddeliv
ery(end-
to-endproductli
fecycle).

3.
5Cl
assi
fi
cat
ionofpr
oduct
s:Ret
ail
i
ngr
efer
stoapr
ocesswher
ether
etai
l
ersel
l
sthegoods
di
rect
lyt
otheend-
userf
orhi
sownconsumpt
ioni
nsmal
lquant
it
ies.

Ty
pesofRet ai
loutl
ets
 De par
tmentSt or
es:Adepartmentst
oreisaset
-upwhi chof f
erswiderangeofpr
oducts
t
ot heend-usersunderoneroof.I
nadepart
mentst ore,
theconsumer scangetal
mostall
t
hepr oductstheyaspi
retoshopatoneplaceonly
.Depar tmentstoresprov
ideawide
rangeofoptionstotheconsumersandthusful
fi
llall
theirshoppi
ngneeds.

Mer
chandi
se:
 El
ectronicAppl
i
ances
Apparels
Jeweller
y
Toil
etri
es
Cosmet i
cs
Footwear
Sport
swear
Toys
Books
CDs,DVDs

Exampl
es-Shopper
sSt
op,
Pant
aloon

 Di
scountSt
ores:Di
scountst
oresal
soof
ferahuger
angeofpr
oduct
stot
heend-
user
s
butatadi
scount
edrat
e.Thediscountst
oresgeneral
l
yoff
erali
mitedr
angeandthe
qual
it
yincer
tai
ncasesmightbealit
tl
einfer
iorascompar
edtothedepar
tmentst
ores.

Wal-
Martcur
rent
lyoper
atesmor
ethan1300discountst
oresi
nUni
tedSt
ates.I
nIndi
a
Vi
shalMegaMartcomesunderdi
scountst
ore.

Mer
chandi
se:Al
mostsameasdepar
tmentst
orebutatacheaperpr
ice.

 Super
mar
ket
:Ar
etai
lst
orewhi
chgener
all
ysel
l
sfoodpr
oduct
sandhousehol
dit
ems,
properlyplacedandarrangedinspecifi
cdepartmentsiscall
edasupermarket.A
supermar ketisanadvancedform ofthesmal l
grocerystor
esandcaterstothe
householdneedsoft heconsumer .Thev ar
iousfoodproducts(meat,v
egetabl
es,dai
ry
products,jui
cesetc)areallpr
operl
ydisplayedatthei
rrespecti
vedepart
mentstocatch
theattenti
onoft hecustomersandf orthem t
opickanymer chandi
sedependingontheir
choiceandneed.

Mer chandise:
Baker yproducts
Cereals
MeatPr oducts,
Fishpr
oduct
s
Breads
Medi cines
Veget ables
Frui
ts
Softdr i
nks
FrozenFood
CannedJui ces

 War
ehouseSt
ores:Ar
etai
lfor
matwhi
chsel
l
sli
mit
edst
ocki
nbul
katadi
scount
edr
ate
i
scall
edaswar
ehousest
ore.Warehousestoresdonotbothermuchaboutt
hei
nter
ior
s
oft
hestor
eandthepr
oductsar
enotpr oper
lydispl
ayed.

 Mom andPopSt
ore(
alsocal
l
edKi
ranaSt
orei
nIndi
a):Mom andPopst
oresar
ethe
smallst
oresrunbyindi
vidualsi
nt henearbyl ocal
it
ytocat
ertodail
yneedsofthe
consumersstayi
nginthev i
cini
ty.Theyofferselect
edit
emsandar enotatal
lorgani
zed.
Thesizeofthestor
ewoul dnotbev erybiganddependsont helandavai
labl
etothe
owner.Theywouldn’
toff
erhigh-endpr oducts.
 Mer chandi
se:
Eggs
Bread
Stati
onery
Toys
Cigarett
es
Cereals
Pulses
Medi ci
nes

 Speci
ali
tySt
ores:Ast
henamesuggest
s,Speci
ali
tyst
orewoul
dspeci
ali
zei
napar
ti
cul
ar
productandwoul dnotsellany
thi
ngelseapartf
rom t
hespecif
icrange.Speci
ali
tyst
ores
sellonl
yselect
iveitemsofoneparti
cularbr
andtotheconsumersandpr i
maril
yfocuson
highcustomersatisfact
ion.

Example-Youwil
lfi
ndonlyReebokmerchandi
seatReebokst
oreandnothi
ngelse,
thus
makingitaspeci
ali
tyst
ore.Youcanneverf
indAdi
dasshoesataReebokoutl
et.

 Mal
ls:Manyr
etai
lst
oresoper
ati
ngatonepl
acef
orm amal
l
.Amal
lwoul
dconsi
stof
sev
eral
ret
ail
out
let
seachsel
l
ingt
hei
rownmer
chandi
sebutatacommonpl
atf
orm.

 ETai
ler
s:Nowadayt
hecust
omer
shav
etheopt
ionofshoppi
ngwhi
l
esi
tt
ingatt
hei
r
homes.Theycanpl acethei
rordert hroughinter
net,
paywiththehelpofdebitorcredi
t
cardsandt hepr
oductsaredeliv
er edattheirhomesonly.However,t
herearechances
thatt
hepr oduct
sorderedmightnotr eachint hesamecondit
ionast heywereordered.
Thiskindofshoppi
ngisconv enientforthosewhohav eahecticscheduleandare
rel
uctantt
ogot oretai
loutl
ets.I
nt hiskindofshopping;
thetr
ansportati
onchargesar e
bornebytheconsumeri t
self
.

Exampl
e-EBAY,
Redi
ffShoppi
ng,
Amazon

 Dol
larSt
ores:Dol
l
arst
oresof
fersel
ect
edpr
oduct
satext
remel
ylowr
atesbuther
ethe
pr
icesar
efi
xed.

Example-99Stor
ewouldofferal
li
tsmer
chandi
seatRs99onl
y.Nofurt
herbargai
ningis
enter
tai
ned.Howevert
hequali
tyoft
hepr
oducti
salway
sindoubtatt
hediscountst
ores.