Merchandising

Lesson 8

What is Merchandising?

• Involves the coordination of buying merchandise that customers want in the proper quantities and then selling that merchandise at a price that customers are willing to pay

Types of Merchandise

• Staple Merchandise:– Basic stock of a store• Bread and eggs

• Fashion Merchandise:– Consists of items that are stocked for several years

and that have solid sales over that time period• Capri pants

• Seasonal Merchandise:– Consists of items that sell well during particular

times of the year that are stocked only for that selling period• Windshield wiper and sunscreen

• Convenience Merchandise:– Consists of items customers buy without thinking

very much about the purchase• Cup of coffee or can of soda

Stock Lists

• Tools that retailers use to help them keep a close eye on the inventory they stock– Basic Stock List:• Keeps track of the staple merchandise that the store

should always keep in inventory

– Model Stock List:• Keeps track of items of fashion merchandise

– Never-out Stock List:• Can be used for all four types of merchandise

Merchandising and Sales

• Most retailers plan sales for their stores based on the sales for the same period in the previous year plus 10%– To meet goals you must have enough products for

sale

Merchandising for Profit

• Strategic placement of store merchandise within the selling space is a big factor in helping to generate merchandise sales and profits– Store Entrance:

• Greatest customer exposure– Place the most appealing merchandise near the front

– Impulse Purchases:• Usually small items that are purchased with little or not

thought on the part of the customer– Placed near front of store, checkout area and in area of heaviest

customer traffic» Candy bars, breath mints, gum

– Related Merchandise:• Consists of items that are related to each other and

that usually sell together– Salsa and Chips

Key Math Concepts

• Compute Planned Sales Increase– Planned Sales Increase = Last Year’s Sales x

Percentage of Increase Planned

• Total Price Per Item:– Total Price Per Item = Quantity Ordered x Price

Per Unit