In today’s strained retail market where sales are harder to come by, it’s never been more important to employ effective merchandise planning.
Doing so can help fashion brands increase sales and improve their bottom line, as well as allowing them to better forecast trends.
It’s with this in mind that merchandise planning software firm Quantiv held a round-table last month, chaired by the company’s business development director Christian Brooks, where the likes of Harrods head of merchandise planning Austin Davidson, Pretty Green buying and merchandise manager Anna Wood, Barratts head of merchandise planning Time Lowe, and White Stuff merchandise manager Hannah Pinkerton, convened to discuss the issues facing their businesses.
With many UK businesses looking beyond the confines of the somewhat flat UK retail scene towards more buoyant markets overseas, the consensus among delegates was that in order to be successful overseas retailers must find partners to work with that are familiar with the host market.
Talking to a global audience
“It’s all about getting those key contacts. You must have someone in the country who understands your company, as well as the industry, territory and the market. It’s important that they are channel and planning driven, and that you can rely on their knowledge when it comes to everything from setting the prices to national holidays,” said Wood.
She added: “You can’t just translate a website exactly, you need to have someone that knows the context, and make sure it works in that different language. This is especially true when it comes to SEO. There might be seven different ways to search for something, so retailers need to go to the country and do the research.”
However, one committee member, who didn’t want to be named, cautioned that fashion businesses must hold onto their core identity. “When some retailers go over to America, they totally change their brand and try to Americanise it. It doesn’t work so they switch back to their core values and it works better. The best thing to do is keep your core values and tweak it a little bit to something that works,” they said.
Of course, going global means adapting your product to the different physical requirements of any given territory, rather than adopting a one-size fits all policy. “The Japanese market requires a whole range of different sizes, so retailers have to start from scratch. We created a range of clothing that was specifically designed for the Japanese market; getting it made in China and then shipping it over to Japan,” said Wood. Offering a localised assortment is also essential within the UK market.
The delegates present at the event agreed that building ranges around key hero pieces is a sound strategy. “There is a big difference between your core and your tail. The tail is probably the thing that creates all of the excitement, [and] makes the people go into your store. It’s new, it’s something that they haven’t seen before and there is lots of noise around it, but the reality is when most people walk into a store that’s the thing they like but it’s not the thing that they buy,” said one committee member.
Making the most of data
Today’s retailers have a wealth of customer information at their fingertips, allowing them to plan ranges more effectively. However, really using that data can be a challenge. “As merchandisers we need lots of bits of data, and we need more of an understanding of the impact of social data. There is a lot of information that we have already,” said one committee member.
Analysing data quickly is essential in order to maximise sales. “Everything happens on a Monday morning, and if you don’t analyse it and make a decision by the afternoon you have missed the boat. If something is telling you this is selling, well you have got to action on it now,” said Sam Daglish, lecturer at the Fashion Retail Academy. The challenge, she added, is using technology to facilitate that. “We have all got to get smarter, the market is shrinking and it’s forcing out companies that don’t really play well. The answer has got to be with technology,” she says. “How do we harness that help in the time frame that we need it?”
In fact a survey by Anya Media at the Retail Business Technology Expo earlier this year found that many are failing to make the most of the latest merchandising techniques and software to give them the customer insight that they need, with more than half of surveyed retailers discounting 10-24% of their stock as a result of over-buying, or purchasing the wrong products.
One committee member urged companies to support their merchandising teams by investing in the right technology. “We need to go to the board and say give me more technology. If you really want to add on an extra percent, we can’t do it with the kind of tools that we have at the moment.”
Toby Potter, EMEA sales director at data analytics firm Datasift said that the growth in use of mobile phones will help retailers capture more insightful data on consumers. “We can track our customers and see where they are at all times. We’re starting to build a picture of our demographic and where they go. That then helps the retailers understand the behaviour in and around their locations.”
However, challenges persist, particularly when identifying what directs consumers to buying in-store. “I wish we could measure footfall much more. Online you have all of that information about where people are clicking, what route they are taking around your site. How many people come in store? It would be good to work that out. It would be good to see how promotions on the internet and promotions in the store are affecting the sale rate. To see if you are actually growing your customer base,” says Wood.
With consumer shopping habits changing out of all recognition and growth in the online and mobile sales channels, there’s no doubt that technology and the data that is captured will come to play an even greater role in merchandise planning in the future.
Christian Brooks - Business development director at Quantiv (Chair)
Sam Daglish – Lecturer at the Fashion Retail Academy
Austin Davidson – Head of merchandise planning at Harrods
Anna Wood – Buying and merchandise manager at Pretty Green
Zoe Wood – Merchandise manager at Liverpool FC
Tim Lowe – Head of merchandise planning at Barratts
Hannah Pinkerton – Merchandise manager at White Stuff
Simon Shutt – Head of merchandising at Hotel Chocolat
Katie Porter – Merchandise manager at Hotel Chocolat
Karen Pearce – Head of merchandising at Modelzone
Keith Austin – Interim head of merchandise planning at Strategic Executives
Ian Harris – MD at Search Labs
Toby Potter – EMEA sales director at Datasift
Steve Richardson – Business development director at Experian Footfall
Emma Davys - Merchandising manager - Quba