Managing the Merchandise Management Process

Flashcards covering key vocabulary and concepts from the Managing the Merchandise Management Process lecture.

Merchandise Management

A process by which retailers offer the right merchandise in the right place at the right time, in the right quantities, at the right price, and in the right sizes.

The Right Merchandise

Merchandise that is appropriate based on trends, industry characteristics, flexibility, and target market characteristics.

The Right Place

The location where products need to be available, taking into account market characteristics at both macro and micro levels.

The Right Time

Timing for products to be available, which considers trends, climate, and timing of markdowns.

The Right Quantities

The amount of inventory that matches market demand and ensures inventory turnover.

The Right Prices

Prices set based on target market characteristics, pricing strategies, and inventory strategy.

The Right Sizes

The appropriate sizes of merchandise based on market characteristics and size optimization.

Open to Buy (OTB)

A retail planning concept that indicates the amount of inventory a buyer can purchase over a given period.

The Bullwhip Effect

A phenomenon in supply chain management where small fluctuations in demand at the retailer lead to larger fluctuations up the supply chain.

Assortment Plan

A set of SKUs offered at the chain level, tailored to retail format and financial strategy.

GMROI (Gross Margin Return on Investment)

A metric that combines gross profit with inventory turnover to show how effectively inventory is utilized to make money.

Sell-Through Analysis

A comparison of actual and planned sales to determine if more merchandise is needed or if price reductions are necessary.

ABC Analysis

A method used to identify performance of individual SKUs based on sales, gross margin, and inventory turnover, ranked by importance.

Store Grading

A ranking system for stores based on various factors like size, market, and profitability to aid assortment planning and stock decisions.