Retail Management ch 12
fashion merchandise category
- only in demand for a short period of time
editing the assortment
Selecting the right assortment of merchandise
lead time
The amount of time between the recognition that an order needs to be placed and the arrival of the needed merchandise at the seller's store, ready for sale.
assortment
The numble of SKUs within a merchandise category
stock-keeping unit (SKU)
The smallest unit available for keeping inventory control. In soft goods merchandise, an SKU usually means a size, color, and style.
sell-through analysis
a comparison of actual and planned sales to determine whether early markdowns are required or more merchandise is needed to satisfy demand.
merchandise group
a group within an organization managed by the senior vice presidents of merchandise and responsible for several departments.
classification
a grouping of items or SKUs for the same type of merchandise, such as pants ( as opposed to jackets or suits), supplied by different vendors.
assortment plan
a list of merchandise that indicates in very general terms that should be carried in a particular merchandise category.
service level
a measure used in inventory management to define the level of support or level of product availability; the number of items sold divided bby the number of items demanded. Service level should not be confused with customer service
product availability
a measurement of the percentage of demand for a particular SKU that is satisfied.
multiattribute analysis
a method for evaluating vendors using a weighted average score for each vendor. The score is based on the importance of various issues and the vendor's performance on those issues.
merchandise budget plan
a plan used by buyers to determine how much money to spend in each month on a particular fashion merchandise category, given the firm's sales forecast, inventory turnover, and profit goals.
department
a segment of a store with in merchandise that reperesents a group of classifications the customer views as being complementrary.
model stock plan
a summary of the desired inventory levels of each SKU stocked in store for a merchandise category
category captain
a supplier that forms an alliance with a retailer to help gain consumer insight, satisfy consumer needs, and improve the performance and profit potential across the entire category
base stock
aka cycle stock; the inventory that goes up and down due to the replenishment process.
basic merchandise category
aka staple merchandise; inventory that has continuous demand by customers over an extended period of time.
order point
amount of inventory below which the quantity available shouldn't go or the item will be out of stock before the next order arrives
perpetual inventory
an accounting procedure whose objectives are to maintain a perpetual or book inventory in retail dollar amounts and to maintain records that make it possible to determine the cost value of the inventory at any time without taking a physical inventory
safety stock
an amount of inventory carried to ensure that you will not run out of inventory because of fluctuating levels of sales
ABC analysis
an analysis that rank orders SKUs by a profitability measure to determine which items should never be out of stock, which should be allowed to be out of stock occasionally, and which should be deleted from the stock selection.
shrinkage
an inventory reduction that is caused by shoplifting by employees or customers, by merchandise being misplaced or damaged, or by poor bookkeeping.
depth interview
an unstructured personal interview in which the interviewer uses extensive probing to get individual respondents to talk in detail about a subject.
staple merchandise category
categories that are in constant demand over an extended time period (ex: items sold in supermarkets, t-shirts, mens underwear)
merchandise category
category- an assortment of items the customer sees as reasonable substitutes for one another
continuous replenishment
continuously monitoring merchandise sales and generatinf replacement orders, automatically when inventory levels drop
markdown money
funds provided by a vendor to a retailer to cover decreased gross margin from markdowns and other merchandising issues.
seasonal merchandise
inventory whose sales fluctuate dramatically according to the time of the year.
buffer stock
merchandise inventory used as a safety cushion for cycle stock so the retailer won't run out of stock if demand exceeds the sales forecast. Also called safety stock.
merchandise management
process by which a retailer attempts to offer the right quantity of the right merchandise in the right place at the right time
breaking sizes
running out of stock on particular sizes.
level of support
service level- a measure used in inventory management to define the level of support or level of product availability the number of items sold divided by the number of items demanded. service level should not be confused with customer service
focus group
seven to ten people who participate in a group discussion led by a moderator
stock-to-sales ratio
specifies the amount of inventory that should be on hand at the beginning of the month to support the sales forecast and maintain the inventory turnover objective. The beginning-of-month (BOM) inventory divided by sales for the month. The average stock-to-sales ratio is 12 divided by planned inventory turnover. This ratio is an integral component of the merchandise budget plan.
cycle stock
the inventory that goes up and down due to the replenishment process. AKA base stock
backup stock
the inventory used to guard against going out of stock when demand exceeds forecasts or merchandise is delayed. AKA safety stock or buffer stock.
variety
the number of different merchandise categories within a store or department
fill rate
the percentage of an order that is shipped by the vendor.
open-to-buy
the plan that keeps track of how much is spent in each month and how much is left to spend.
category management
the process of managing a retail business with the objective of maximizing the sales and profits of a category