Range Planning Lecture 5
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Questions and Answers

Which type of fashion retailer has the longest expected stock cover?

  • Independent retailer
  • Value discount store
  • Haute couture (correct)
  • Fashion multiple

    • What is a consequence of failing to achieve the planned stock turn in a fashion retail context?

  • Increased consumer interest
  • Improved cash flow for new stock
  • Enhanced brand perception
  • Creation of last year's styles display (correct)

    • What problem arises when a retailer's stock range looks tired and fragmented?

  • Increased stock turn rates
  • Customer confusion about quality (correct)
  • Improved customer loyalty
  • Boosted visual appeal

    • What is the main issue associated with slow stock turns in fashion retail?

    <p>Lack of financial resources for investment</p> Signup and view all the answers

    Which type of fashion retailer is expected to have the shortest stock cover?

    <p>Value discount store</p> Signup and view all the answers

    What is the primary reason for carrying fringe sizes in small quantities?

    <p>Statistical demand for them is generally lower.</p> Signup and view all the answers

    Which month typically has the highest percentage of sales in women's fashion retail?

    <p>December</p> Signup and view all the answers

    What is the purpose of sales phasing?

    <p>To break down sales into manageable portions over time.</p> Signup and view all the answers

    During which season are sales of nightwear and underwear expected to peak?

    <p>Autumn/Winter</p> Signup and view all the answers

    How should buyers respond to new store openings when phasing sales?

    <p>Incorporate potential sales increases into your sales phasing.</p> Signup and view all the answers

    What is the fundamental sales ratio between tops and bottoms in fashion retail?

    <p>2:1</p> Signup and view all the answers

    What can significantly impact planned sales phasing?

    <p>Public holidays and promotional events.</p> Signup and view all the answers

    What is often considered a fashion ideal regarding stock availability?

    <p>100% availability of all sizes and colors.</p> Signup and view all the answers

    What does the range plan primarily help a retailer to determine?

    <p>The product mix and financial parameters</p> Signup and view all the answers

    What is a key factor buyers consider when determining the product mix?

    <p>Sales history and emerging trends</p> Signup and view all the answers

    How does the range planning process benefit a fashion retailer's sales?

    <p>By offering a cohesive and comfortable price range to customers</p> Signup and view all the answers

    Which of the following metrics is not essential for merchandise planners in fashion retail?

    <p>Average customer height</p> Signup and view all the answers

    What is the effect of the shift from seasonal purchasing to quicker product bursts in fashion retail?

    <p>A need for more frequent product planning and turnover</p> Signup and view all the answers

    Which aspect does the breadth of the product mix refer to?

    <p>The total styles available across different categories</p> Signup and view all the answers

    What is the purpose of conducting a post-season review of sales history?

    <p>To identify good and bad sellers for future stock decisions</p> Signup and view all the answers

    What challenge does unpredictability present to fashion and apparel planners?

    <p>Accurately estimating customer preferences and demands</p> Signup and view all the answers

    What kind of items are usually considered riskier in fashion inventory?

    <p>Unusual colors and prints forecasted as trendy</p> Signup and view all the answers

    In range planning, what role do designers, buyers, and merchandisers play in determining product mix?

    <p>They collaborate to analyze styles, sizes, and fabric types.</p> Signup and view all the answers

    What does sales phasing allow retailers to do?

    <p>Introduce new color statements and products over time.</p> Signup and view all the answers

    Why are variances in garment sizes significant to retail buyers?

    <p>They influence inventory levels and customer satisfaction.</p> Signup and view all the answers

    What is an essential strategy for reducing levels of risk in merchandise offerings?

    <p>Incorporating enough trend-based pieces for balance</p> Signup and view all the answers

    Study Notes

    Range Planning Lecture 5

    • YouTube video on forecasting range planning is available at https://www.youtube.com/watch?v=nNWFn1rcNG8
    • Retailers create a product offering reflecting target market needs, wants, and aspirations.
    • A range plan is a detailed overview of a collection, encompassing design and financial parameters.
    • The range plan includes specifics like number of styles, fabrics used, and colorways.
    • Benefits of a range plan include visibility into the next season's range and planned margin performance before committing supplier orders.
    • A range plan positively impacts sales by presenting a cohesive range with various choices and price points aligning with customer preferences.
    • Range planning is crucial for determining the product mix, styling direction, and theme.
    • Different phases within a season are timed to allow for new products.
    • The team of designers, buyers, and merchandisers define the total number of styles per product category.
    • This includes the proportion of tops/bottoms, daywear/evening wear, fashion/classic/basics, the size range, fabric type, and number of colors per style.
    • Fashion retailers are increasing the number of collections during a typical season.
    • This shift in fashion retailing has transitioned from seasonal purchasing to shorter, rapid releases of new products.
    • To determine the product mix, buyers and merchandisers review previous season's sales history, emerging trends, and competitor performance with designers.

    White Board Exercise

    • Benefits of a range plan are identified via a white board exercise.

    Benefits of a Range Plan

    • The range plan provides visibility into the next season's range.
    • The plan helps with planned margin performance before supplier orders.
    • It promotes cohesive and wide choices of products, matching price preferences of customers.

    The Range Plan

    • The range plan details all design and financial parameters for a collection.
    • The plan details the number of styles, fabrics, and colorways.

    Merchandise Planning

    • Merchandise planners assess daily, weekly, and seasonal demand.
    • This is challenging due to fashion unpredictability, seasonality, and product complexity.

    Risk and Range Size

    • While unusual colors, prints, and styles are trend forecasted, most customers prefer predictable styles.

    Reducing Levels of Riskier Merchandise

    • Fashion buyers tend towards caution in risky styles but do include some to achieve the correct balance.
    • This balance gives the correct impression for the overall display or department.

    The Right Balance

    • International garment sizing standards may variate between retailers and brands.
    • Customers prioritize sizing options that fit and are available.

    Range Width and Depth

    • Buyers and merchandisers plan the number of product lines based on size or group of stores.
    • Department stores generally stock thousands of individual products; small boutiques are stocked with hundreds.

    Breadth/Width of Product Mix

    • This hierarchy shows how different lines of products (Clothing, Accessories, etc) are related in a company like D-Diesel.

    Narrow and Deep/Square/Broad and Shallow

    • Different types of retailers have specific range widths and depths.
    • Examples include tie racks (specific/deep), department stores (broad/shallow), and market specialists (square).

    How Much to Stock?

    • Stocking every color and size of an item is less common than ideal in fashion.
    • Fringe sizes are available in limited quantities because customer demand is lower.
    • Retailers struggle to provide full color, size, and variability of options. Retailers often target 90% availability

    Sales Phasing

    • Breaking down sales into various stages within a season can match trends and timing to maximize revenue.
    • Adjustments for public holidays and store openings/closings are frequently incorporated.
    • Monthly financial sales phasings of a typical fashion business are often shown graphically.
    • Seasonal variations are significant (ex: A/W vs S/S)
    • Departments like nightwear/underwear and swimwear have seasonal peaks.

    Sales Phasing

    • Seasonal variations—A/W sales usually higher than S/S.
    • Seasonal peaks—departments like nightwear/underwear and swimwear have seasonal peaks during specific months of the year (Nov/Dec, May/June respectively).

    Exercise: Break out Group

    • The exercise focuses on understanding reasons for slow-moving merchandise and methods to improve buyer stock turnover.
    • Reasons for merchandise moving slower than expected can include carrying an excessive range, featuring incorrect merchandise items, offering items at prices considered excessively expensive, and the lack of store support promoting or highlighting goods.

    EXERCISE

    • External and internal factors influencing fashion sales phasing are discussed in various exercises.
      • External factors are external to the retail business and include unplanned events and competitor actions (ex: unplanned events like strikes).
      • Internal factors include planned actions such as staff levels and sales promotion tools.

    Key Factors Influencing Fashion Sales Phasing

    • External Factors include unplanned events like inclement weather, local events, strikes, competitors' sales, and seasonal demand.
    • Planned Factors include holiday periods and natural seasonal demand for specific garments (such as swimwear).

    Key Factors Influencing Fashion Sales Phasing- Internal

    • Internal Factors include sales promotions, correct staffing levels aligning with sales periods, and suitable range offerings and pricing.

    Alternative Ways of Sub-Dividing Product Ranges

    • Ranges may be categorized by end-use, price, brand, classic/fashion items, core/non-core items, and trends or fads.

    Fashion Retail Planning Levels

    • Planning occurs at different levels for individual garments (line or style), sub-category (eg long skirts), category (eg skirts), department (shorts, trousers), and business (all ladies'/men's).

    At the Start of a Season

    • Buyers and merchandisers manage three critical aspects: last season's sales (slow-moving lines addressed) , current season (delivery, monitoring, reacting), and future season (planning, writing orders, delivery phasing).

    The Product Mix

    • Core items, like hosiery, t-shirts, and lingerie sell all year as best sellers.
    • Core items have high volumes, high margins, a low development cost, and require updates to fashion trends.

    The Range Plan and Initial Allocation

    • Sample range plan outlines the number of lines per store turnover, helping forecast the correct quantity of goods to order and hold in stock.

    Compiling a Range Plan

    • The range plan includes the number of garments, proportion of garment types, specific styles, fabric/color options, costs, selling prices, manufacturers etc.

    Generating the Right Balance

    • Exercises determine the factors creating a well-balanced range.

    Good Range Balance Means

    • A balance is well-received, visible, fashionable, includes brands appropriate for the retailer, has good value, and all sizes, colours, and fits of appropriate items are readily available.

    Challenges

    • Consumers expect quick options for all products.
    • Wide variety/choices are necessary for customer satisfaction.
    • Buyers need to consider the need to provide replacements if original items are unavailable.

    Perfection is Never Possible…

    • Balance of a range is more important than perfection due to consumer demands

    The Importance of Planning

    • Fashion retail merchandise planning numerically tracks and manages product development to final delivery.

    EXERCISE: Planning Too Far in Advance

    • Possible issues with planning too far in advance include missing emerging trends, new colours/shapes emerging nearer to the actual trading season, and the need to react to feedback and adjust/order items frequently.

    Starting the Planning Process for a Season

    • Planning begins 6-12 months prior to the start of the season.
    • Examining previous season's outcomes is important (best/worst sellers).

    The Importance of the Merchandiser in Planning

    • Combining previous sales data with sales/trend predictions and being ready to adapt is essential for efficient merchandise planning.

    Setting Sales/Budget Targets

    • Top-Down: targets set from a higher level.
    • Bottom-Up: Buyers and merchandisers set individual targets based on their areas of responsibility; the targets then sum up to total.

    Sales Planning

    • Ongoing sales and stock re-forecasting adjusts throughout the season to accommodate changes like best/worst sellers.

    Stock Turns/Week Cover

    • Businesses invest in stock to turn it into cash quickly.

    Stock Turn

    • Stock turn (weeks cover) measures how quickly stock is sold. Fast turnover is desirable, leading to higher profits.

    Stockturn Weeks Cover

    • Stockturn is calculated/determined by dividing annual sales by the average monthly stock value, representing the number of times stock turns over annually, giving an indication of sales efficiency.
    • Dividing the stock turnover number by 52 converts this to a measure in weeks.

    Usual Expected Weeks' Stock Cover

    • Typical stockturn weeks cover varies by retailer type, with some (eg haute couture) requiring far less due to specialized item types/demand compared to others (eg Value Discount stores)

    Failing to Achieve Planned Stock Turn

    • Issues include seasonal stock carryover, last year's styles, range fatigue, and blocked buying.

    Last Year's Styles

    • Displaying last year's styles can damage customer sentiment and perception of the fashion business resulting in confusion.

    Range Fatigue

    • If retail stock does not turn over quickly enough, the range will appear tired and visually unappealing, leading to poorer perceptions.

    Blocked Buying

    • Slow stock turn might create a lack of funds to invest in new stock, preventing the ability to track current trends and provide a fresh product mix for the customer.

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    Related Documents

    Lecture 5 Range Planning - Fashion Retail

    Description

    Explore the key concepts of range planning in retail, focusing on forecasting, product offerings, and market alignment. Understand how a well-structured range plan can improve sales and streamline supplier decisions. This lecture covers design specifics, product mix, and phase timing within a season.

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