planning overview2
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STRATEGIC MERCHANDISE PLANNING
Purpose of the Overview
The overview is designed to: De-mystify Planning Identify challenges Offer solutions Present services
Connections
Planning
Assortment Planning
Store / Point-Of-Sale
Allocation and Replenish
Plans Suggested orders & Distributions
Actual DistributionsHistory
Everybody Plans
All companies perform some type of planning function:
Financial plans, Merchandise plansStore plansAssortment plans
Planning is not limited to sales, but can include other measures such as inventory, receipts, markdowns, shrink, margin, etc
The goal of any plan is to measure performance and determine the ROI .
Vehicles of Plans
Planning comes in different forms
Excel spreadsheet
Paper, pencil and calculator
Dedicated Planning software
Vehicles of Plans
Planning may be performed in various ways:
Top level planning (Company plans)Style planningHierarchy level planning (Department planning)Store planningSeasonal planning (Holiday)
Who Plans?
Depending on the size of the organization, the planning function is done by:
Dedicated planners Buyers Merchandise managers Finance Allocators Presidents / CEO’s Store Operations Store managers
Challenges
Challenges
The Challenges faced when purchasing planning software:
The Planning software is usually discussed with the wrong audience, i.e., IT personnel or project sponsors instead of the business unit.
Finding the right person to speak with within an organization is tricky.
The planning function is quite complex and based on mathematics and retail theory, therefore difficult to discuss.
Don’t know enough about the product; fear of the unknown, on both sides.
Planning is not really about the software, but rather about process and how you want to run your retail business; the software acts as a vehicle.
Challenges
The Challenges faced when implementing planning software:
In many cases, training is usually centered around the software and it’s functionality, and not on Retail Theory.
A mathematics based application is difficult for many to people to grasp.
In many organizations, the planning function is undervalued and often ignored when business is good; it is therefore not given the importance and attention that it deserves.
Challenges
There is a lack of qualified planners in the market, resulting in high turnover.
Initially, staff is trained by the software provider. Once they leave, the original software provider is not called
back to train new personnel; This lack of training usually encourages the turnover…it’s a
downward spiral.
The assumption is that dedicated Planning applications are too complicated, but in reality, it is the planning function that is complicated, not the software.
Solutions
Challenges vs. Solutions
Challenge: The Planning software is usually discussed with the wrong
audience, i.e., IT personnel, or project sponsors instead of the business unit.
Solution: Planning discussions need to be between the software
provider and a healthy cross-section of the business (buyers, planners, merchandisers, CEO’s, CFO’s)
On the business side you need to involve people who understand the way you do business, how you plan, how you buy, how you receive, how you ship, how you assort and how you clear merchandise.
Challenges vs. Solutions
Challenge: Finding the right person to speak with within an
organization is challenging.
Solution: Assess the level of retail and planning knowledge of the
software provider. Insist on dealing with someone who understands retail as
well as planning.
Challenges vs. Solutions
Challenge: The planning function is quite complex and based on
mathematics and retail theory, therefore difficult to discuss.
Solution: Understand the mathematics Ensure that any calculation can be customized at any time
based on your business requirements. Ensure that any customization does not require for the
software to be re-implemented.
Challenges vs. Solutions
Challenge: Don’t know enough about the product; fear of the unknown,
on both sides.
Solution: Education Don’t be shy about communicating what you need to know to
make you comfortable with the topic. Ensure that you have access to knowledgeable consulting
resources to: Help you understand the product. Be available to answer any questions anyone may have. Help build your planning and retail processes.
Challenges vs. Solutions
Challenge: Planning is not really about the software, but rather about
process and how you want to run your retail business; the software acts as a vehicle.
Solution: You need to move away from how things were done in the
past, including handed-down processes and move towards how things should be done.
These types of process definitions will help you measure your performance and realize the ROI.
Ensure that you have access to the latest information on industry best practices.
Challenges vs. Solutions
Challenge: In many cases, training is usually centered around the
software and it’s functionality, and not on Retail Theory.
Solution: Learning to press buttons is easy, understanding the
reasoning behind the buttons is quite another story. Make sure you have access to specialized retail and planning
consulting services, which can be used to: Mentor inexperienced staff Bring in a fresh perspective Improve efficiencies
Challenges vs. Solutions
Challenge: A mathematics based application is difficult for many to
people to grasp.
Solution: In this case, insist on having simple, clear and accessible
documentation that defines and explains all the calculations that exist in your system.
Conduct workshops on the mathematics behind the calculations to ensure that your staff is evolving at an optimum rate.
Challenges vs. Solutions
Challenge: In many organizations, the planning function is undervalued
and often ignored when business is good; it is therefore not given the importance and attention that it deserves.
Solution: The reality is that planning is equally important in good
times as in bad. When times are good, planning can help you seize
opportunities. When times are bad, planning will help you keep inventories
under control. Plans are the only way that you can measure your progress.
Challenges vs. Solutions
Challenge: There is a lack of qualified planners in the market, resulting in
high turnover. Initially, staff is trained by the software provider. Once they leave, the original software provider is not called back
to train new personnel; This lack of training usually encourages the turnover…it’s a
downward spiral
Solution: One option is to outsource some of the planning functions all the
while maintaining approval authority. Second option is to augment your current planning activities to the
next level. Accurate and up-to-date documentation is the key to ensuring that
the knowledge remains in the company and does not leave with the employee.
Challenges vs. Solutions
Challenge: The assumption is that dedicated Planning applications are too
complicated, but in reality, it is the planning function that is complicated, not the software..
Solution: Regardless of what bells and whistles may exist within a piece of
software, the user needs to understand the logic behind the buttons they are pressing.
Buying a dedicated planning application goes beyond the software. It is your opportunity to reach your potential based on a process that best suits your business environment.
In a retail environment, processes are continuously evolving and as a result, a planning implementation is not a task, it is a relationship.
Services
Our Services
Planning implementation consulting. Assortment Planning implementation consulting. Allocation Evaluation Consultation on custom calculations Planning Outsourcing Planning/Retail Consulting Business process definition/consultation Augmenting planning functions Merchandising/Planning Hierarchy definition System audits Business audits Report assessment and consolidation
