Podcast
Questions and Answers
What is the first component of a Profit & Loss statement?
What is the first component of a Profit & Loss statement?
- Gross Margin
- Operating Expenses
- Profit & Loss
- Real Volume of Sales (Net Sales - Returns) (correct)
What is research in the buying process based on?
What is research in the buying process based on?
- Market trends
- Five-year averages
- This year's sales
- Last year's sales (correct)
What step comes after research in the buying process?
What step comes after research in the buying process?
- Planning (correct)
- Managing
- Purchasing
- Selection
What is the purpose of a credit note?
What is the purpose of a credit note?
What is the main difference between an Independent Office and a Merchandise Brokers Office?
What is the main difference between an Independent Office and a Merchandise Brokers Office?
What is the 'Division' in a Purchase Order?
What is the 'Division' in a Purchase Order?
When does the Fall/Winter season begin?
When does the Fall/Winter season begin?
What is the purpose of the 'Completion' date in a Purchase Order?
What is the purpose of the 'Completion' date in a Purchase Order?
What is a major factor that affects the scope of a buyer's job?
What is a major factor that affects the scope of a buyer's job?
Who does a DMM typically report to?
Who does a DMM typically report to?
What is a key responsibility of a Senior Buyer?
What is a key responsibility of a Senior Buyer?
What is the primary role of a Planner in a retail organization?
What is the primary role of a Planner in a retail organization?
What is a characteristic of a successful buyer?
What is a characteristic of a successful buyer?
What type of products are classified as Soft Lines?
What type of products are classified as Soft Lines?
What is a benefit of centralized buying?
What is a benefit of centralized buying?
What is a type of departmentalization?
What is a type of departmentalization?
Study Notes
Factors Affecting the Scope of the Buyer's Job
- Merchandise carried, organizational structure, and size of the retail organization affect the scope of the buyer's job.
DMM and GMM Roles
- DMM responds to the GMM (Corporate: CEO → CFO → Buyer vs GMM → DMM → Buyer).
Senior Buyer's Job Duties and Responsibilities
- Ensure having the right product at the right price, time, and quantity.
- Analyze last year's sales to forecast this year's sales.
- Conduct market trips to overview the season (4-6 months in advance).
- Analyze reports and fashion trends.
- Negotiate with vendors on MOQ, price, and timing.
- Price merchandise.
Planner's Role
- A planner monitors stock levels by store and tracks key items for sale (common in large companies).
Personality Traits for Buyers
- A buyer should have drive, vision, human relation skills (communication), and merchandise knowledge.
- Know how to create a P/L statement and understand its factors.
Soft and Hard Lines
- Soft lines are apparel and accessories (linens, currents, pillows).
- Hard lines are hardware, sporting goods, appliances, furniture, toys, and lawn and garden products.
Centralized Buying
- All buying activities are performed from central headquarters.
- Benefits include steady flow of merchandise, more accurate sales forecasts, reduced expenses, and more purchasing power.
Types of Centralized Buying
- Centralized Merchandising Plan
- Warehouse Requisition Plan
Departmentalization
- Functional (Controlling, Promotion, Operations, Merchandising)
- Product Line
- Geographic
Profit and Loss Components
- Real volume of Sales (Net Sales - Returns)
- Cost Of Goods
- Gross Margin (difference between COGS and net sales)
- Operating Expenses (excluding COGS)
- Profit & Loss
Research and Planning
- Research is based on last year's sales.
- The process includes research, planning, selection, purchasing, and managing.
Types of Buying Offices
- Independent Office: Salaried/Fixed Fee
- Merchandise Brokers Office: Store Owned buying office
Credit Notes
- A credit note allows brands to apply a dollar value to a future PO if something went wrong in a previous order.
Purchase Order (PO)
- A PO should include order details, division, total units, order date, shipping date, completion date, credit note, division, order type, total units, season, payment terms, and currency.
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Description
Learn about the key aspects of retail buying, including factors affecting the buyer's job, roles of DMM and GMM, and responsibilities of a senior buyer.