2. Structure uniqueness of Textile
 Complicated stock keeping units (SKU)
estimation
 Strong effect of Fashion
 Domination of textile supplier and retail
buyers over manufacturers
 Difference of product ordering procedure

3. But the Biggest challenge is to
“ Integrate qualitative data and
theory to quantitative demand
forecasting ”
This most of the time leads to Intuition based
Decision .

4.  To reduce possible Fatal-loss from an uncertain
demand prediction retail buyers use :-
1)Quick response (QR) system
2)Electronic Data Interchange (EDI)
3)Point of sale (POS) system
4)Management Information System (MIS)
 Implementation of these helps in
1)Effective order-reorder schedule
2)Inventory cost management
3)Faster sourcing strategy
4)Improvement of Assortment planning

5. RETAIL BUYING
PROCESS
ROLE OF RETAIL BUYER
 Planning policies
 Buying in
 Budgeting
 Planning model stock
 Contacting Vendors
 Planning Promotions

6. RETAIL BUYING PROCESS
Merchandise planning
Assortment planning
Actual buying &
rearrangement

7. RETAIL BUYING PROCESS
Merchandise Planning
 For realistic Merchandise planning retail
buyer must consider:-
1)Target market demand
2)Local retail competition
3)Physical expansion needed in the store
4)Planned promotional efforts
5)Trend analysis
6)Seasonal consumer demand
7)Economic condition

8. RETAIL BUYING PROCESS
Merchandise Planning
 Merchandise planning may require fashion
forecast , sales forecast .
 Objective of Fashion Forecast in
merchandise planning:-
1)Studying market condition consumer buying
behavior.
2)Evaluating up to date fashion trend
information.
3)Noting street fashion of target consumer.

9. RETAIL BUYING PROCESS
Merchandise Planning
 Objective of sales forecast in
merchandise planning :-
1)Trend analysis
2)Effective order in term of quantity
decisions of specific style ,colors, size.
3)To develop efficient and effective
inventory control plan.

10. RETAIL BUYING PROCESS
Merchandise Planning
 Two approach used for sales forecast:-
1)Top-down
2)Bottom-up
 4 Steps of top-down forecasting process :-
1 • Planning sales goal
2 • Planning stock level for company & each store
3 • Planning assortment plan
4 • Making a sales forecast report

11. RETAIL BUYING PROCESS
Merchandise Planning
 3 steps of Bottom-up forecasting process:-
• Determining sales potential for individual item
1
• Planning total sales & stock level by adding
2
• Making a sales forecast report
4
• If item proportion in assortment plan is positively
correlated BOTTOM-UP approach is used .
• If item proportion in assortment plan is negatively
correlated TOP-DOWN approach is used.

12. RETAIL BUYING PROCESS
Assortment Planning
UNIT
PLAN DOLLAR
PLAN
UNIT PLAN:- It most often refer to qualitative decision
DOLLAR PLAN :- It is quantitative result of
assortment planning

13. RETAIL BUYING PROCESS
Actual buying and rearrangement plan with
vendors
 Retail buyer looks for new product.
 Vendor evaluation on following criteria :-
1)Quality of goods
2)Good delivery
3)Product fashion-ability
4)Fair price
5)Styling
6)Reputation
7)Selling history
8)Steady source of supply.

14. RETAIL BUYING PROCESS
Organizational Buying Behavior
Organizational Buying Behavior involves three aspects
• Psychological world of individuals involved
1
• Rapid & joint buying decision making
2
• Conflicts and its resolution among decision
3 makers.

15. RETAIL BUYING PROCESS
Assortment - planning process

16. RETAIL BUYING PROCESS
Assortment planning process
1.PROBLEM RECOGNITION
 It is perceived gap or discrepancy between
current state and desired state of company
/store.
 Two Major problem with which this step
begins :-
1) Change in desired state for a store .
2) Change in current store assortment .

17. RETAIL BUYING PROCESS
Assortment planning process
2.Information Search
 Internal source of Information :- Store records
, merchandise plan reports , sales people opinion.
 External Source of Information :-
a)Customer panel
b)Consumer magazine & trade publication
c)Vendor opinion
d)Trade associations
e)competitors
f)Fashion forecast magazine .
g) Reporting bureaus.

18. RETAIL BUYING PROCESS
q
Assortment planning process
3.Product Evaluation(a)
 Qualitative Evaluation :-
 Important aspect in evaluation is desired
solution to a problem, establishing criteria of
evaluation.
 Fiorito`s product specific criteriaKang found in her
:-
 Quality research that retail
buyers and their
 Color target customer have
similar variance
 Position on the fashion cycle of criteria importance
and product specific
 Styling perceived risk
 Distinctiveness

19. RETAIL BUYING PROCESS
Assortment planning process
3.Product Evaluation(b)
 Quantitative Evaluation :-
Its component are following :-
 Initial markup for period
 Planned net sales
 Planned BOM(Beginning of month)
 Planned ending inventory (EOM)
 Planned reduction
 Planned purchases at retail.

20. RETAIL BUYING PROCESS
Assortment planning process
4.Forecasting product selection and sales.
 Forecasting Style Selection
 Forecasting Color Selection
 Forecasting Size Selection
Forecasting methods for Assortment -planning :-
1. Decomposition
2. Product life cycle analysis
3. Exponential Smoothing
4. Regression Analysis
5. Jury of Executives.
6. Fashion Diffusion Curve Analysis

21. RETAIL BUYING PROCESS
Assortment planning process
4.Forecasting product selection and sales.
 Decomposition :- It is a sales forecast which split total
sales forecast for individual forecast of each product line
and SKU level by importance rating.
 Regression Analysis :- It is a forecast that estimate
relationship between sales and external variables.
 Exponential Smoothing :- It is a weighted moving
average of past sales with considering irregular
component.
 Jury of executive opinion :- It is a sales forecast based
on cross section of a smaller expert group .

22. RETAIL BUYING PROCESS
Assortment planning process
5. Rules for Product Selection
1. Compensatory Rule :-It includes calculation of an
importance weight and attribute rating for each attribute &
then arrive at total product satisfaction score by adding
them.
2. Lexicographic Rule :- It requires to rank the attributes
according to importance & then select brand that is superior
on most important attribute.
3. Conjunctive Rule :- Minimum standard is set for each
attribute and then fast and simple elimination is used for
selection of best alternatives.