MM Chapter 1 & 2

8/3/2019 MM Chapter 1 & 2

http://slidepdf.com/reader/full/mm-chapter-1-2 1/34

Merchandise Management

SyllabusBooks

Ecompanion

Contact Information

8/3/2019 MM Chapter 1 & 2


Chapter 1

Introduction to Retail Buying

8/3/2019 MM Chapter 1 & 2


Introduction to Retail

Buying

What is Retail Buying?

Decision Making

8/3/2019 MM Chapter 1 & 2



Buying1. Planning - customer needs and market conditions

2.Purchasing ± making the purchase and assuming risks

3.Assorting ± timing

4.Controlling ± Pricing and Profit

5.Communicating ± motivating the consumer ± promotion

We will be learning the tools used by buyers to accomplish these challenging these tasks.

8/3/2019 MM Chapter 1 & 2



Buying1. Planning - Right Product

2.Purchasing ± Right Quantity

3.Assorting ± Right Location

4.Controlling ± Right Price

5.Communicating ± Right promotion

8/3/2019 MM Chapter 1 & 2


Environmental Facets«that affect a buyers decisions..

1.Market Trends

2.Economic Trends

3.Technological Advancements

4.Competition

5.Federal Regulations

6.International retailing

8/3/2019 MM Chapter 1 & 2


Six Environmental Facets

1 &2 Market and Economic Trends

What type of trends would influence your buying?

What trends are happening?

Case Study: Handout

8/3/2019 MM Chapter 1 & 2



3. Technological Advancements

Social media

Real time information

Fast communications

8/3/2019 MM Chapter 1 & 2



4. Competition

Different store types to choose from

Online stores

Direct and Indirect

8/3/2019 MM Chapter 1 & 2



5.Federal Regulations ± laws that influence

buying decisions.6.International retailing ± world wide

competition and the desire for unique

products.

8/3/2019 MM Chapter 1 & 2


Roles of the Buyer

1.Analysis of Past Sales and Promotions

2.Planning Financial Budgets

3.Merchandise Development, Selection, and Pricing

4.Vendor Planning and Negotiations

5.Development of the marketing plans

6.Training and Development

p.8 Exhibit 1-2 «.read

8/3/2019 MM Chapter 1 & 2


Qualities of the Buyer

1. Get along with people and communicate

2. Possess a marketing orientation3. Takes risks

4. Makes decisions

5. Dedicated to their work

6. Exhibit leadership qualities

7. Ability to predict

8. Educational background

8/3/2019 MM Chapter 1 & 2


Evaluating Buyer

Sales

Inventory results

Gross Margin results

DollarsUnitsTransactions

Sales per sq ft

Turnover ShortagesSeasonal carryover

MarkupGross margin

8/3/2019 MM Chapter 1 & 2


Buying positions

Merchandise assistant or executive

Assistant buyer or buyer assistant Associate buyer

Buyer

Divisional merchandise manager Vice president (VP) or General

Merchandise Manager

8/3/2019 MM Chapter 1 & 2


8/3/2019 MM Chapter 1 & 2


Retail Formats

Small Independent stores

Department stores Discount stores

Specialty stores

Category Killers Nonstore retailers

Describe each and give and example

8/3/2019 MM Chapter 1 & 2


Chapter 2

Why consumers buy

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy

Why do you Shop?

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«

1. Store-Choice determinants

2. Types of shoppers

3. In store influences

4. External Influences

5. Internal Factors

6. Market Segments7. Lifestyle

8. Decision making process

9. Cultural Influences

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«because of the store

Store-Choice determinants

What are your favorite stores and why? Handout

1.Store Personnel

2.Physical store characteristics

3.Nature and quality of merchandise assortment

4.Promotion, advertising, and display of the store

5.Nature of store clientele

6.Prices

7.Services

8.Store Image

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«because of the store

By using the Store-Choice determinants

we can measurements what is importantto our customers.

1. Multi-attribute model ± assumes all factors are equal

2. Compensatory model ± assumes some factors are more important3. Noncompensatory model ± only evaluated on one or two models

How would this type of information assist you as a buyer?

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«

Types of Shoppers

1.Shopper type by value orientation

2.Shopper type by time needed in the adoption process

3.Shopper type by frequency and intensity of informationsearch

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«

Types of Shoppers

Shopper type by Value orientation

Economic Consumer ± price sensitive

Personalized consumer ± recognition by personal contacts

Ethical Consumer ± helping out the owner Apathetic Consumer ± difficult and tiring task ± location is

important and assistance

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«

Types of Shoppers

Shopper type by Adoption process Innovators ± earliest adopters - young/at heart, educated, affluent

Early adopters ± younger better educated ±staff and advertising influence

Early majority ± cautious, weighing purchase

Late majority ± older, lower income, skeptical of new things

Laggards ± after complete adoption

P.42 ± very good advice for buyers«read

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«

Types of Shoppers

Shopper type by Information Search Objective ± highly educated ± consider many sources

Moderate ± limit store visits ± return customer

Store-intensive ± visit many stores and sources Personal-advice seeker ± does not like to shop ± use

personal sources of information

P.43 - read

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«

In-store Influences

Sales

POP

Sales personnel

Stockouts

8/3/2019 MM Chapter 1 & 2


8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«

Internal Factors

Attitudes ± about a store, product, service

Perceptions ± prices

Personality ± consistent patterns ± hard to measure

Motives ± Rational and Emotional

P.48

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«

Market Segmentation Approaches1. Geographic

2. Demographic

3. Benefit ± fashion forward vs. laggard

4. Psychographic

5. Value andlifetime survey VALS

Buyer can use this info to make decisions about what to carry

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«

LifeStyleHow people spend their time and money«

The total image that a person has of themselves

Changes: Youth orientation of older people, concern for health,

concern for money, simplified lifestyle, increased technology,

international travel, ease of shopping, co-design products.

How do these affect apparel buying decisions?

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«

Consumer Decision Making Process As a buyer you must understand how consumers make

decisions about making a purchase.

1. Problem Awareness

2. Information Search

3. Alternative Evaluation

4. The Purchase

5. Post-purchase Behavior

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy«

Cultural InfluencesIf you are catering to a specific consumer or cultural group get

to know that group«.The Chevy Nova was introduced in

Mexico and it was a ³no go´

Myths and rituals can have many interpretations«

Animals have meaning as logo¶s, colors

Set prices vs. bargaining

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy« Assignment #1Using Excel, research tools and the topics discussed in this chapter create a company and

customer profile. Gather information on your assigned company and its customers. Researchone location of the firm and the customers recording your data in an excel spread sheet.

1. Name and describe the store for which you are buying. This includes its location, annual

sales. History, size and anything else you would like to know.

2. Detail the complete demographics and descriptive information about the customer at that

location.

3. Identify the type of customer who would shop in the store using the typology in this

chapter. Include the Store-choice Determinants that you customer would consider the

most important, the type of shopper they are, how the external and internal factors

influence their shopping, are there any lifestyle changes of cultural issues that affect your

customer?

8/3/2019 MM Chapter 1 & 2


Why Consumers Buy« Assignment #1« together Hoover¶s for the business stuff

Census bureau or zip skinny for demographics

Textbook for typography

Open Excel

MM Chapter 1 & 2

Documents

Transcript of MM Chapter 1 & 2