Having the right merchandise in your store is essential to success. As a retailer, it is your job to ensure that you are stocking the right items in your store, in the correct amounts, and at the correct prices. It can be difficult to navigate the world of merchandise buying, especially with so much new technology changing the way that businesses purchase products. In this article, we will provide an overview of the merchandise buying process, including the importance of investing in the right products, researching trends, and understanding pricing strategies. We’ll also discuss some of the most recent advancements in merchandise buying technology and how these can help you make the most informed decisions for your store. With the right approach and the right tools, you will be able to create a successful merchandise buying plan for your business.
Retail Management – Merchandising
How does merchandise buying work?
Merchandise buying typically consists of four steps, including:
1. Identify merchandise sources
The first step in purchasing merchandise is to locate vendors from whom you can buy high-quality products to sell to customers. There are many manufacturing and wholesale options available, so it’s crucial to thoroughly investigate the reliability and corporate background of vendors before agreeing to do business with them. Prices, materials, and delivery methods are some factors to take into account when choosing product sources.
2. Negotiate with manufacturers
Negotiating with the product source of your choice is the next step when purchasing goods for a retailer. The majority of retailers prefer to purchase goods in bulk to ensure ample supply and additional inventory in case sales exceed expectations. When purchasing a lot of something, it can be advantageous to bargain for a lower price based on the sheer volume of your purchase. You can use the money you save from these negotiations to buy other things, either from the same vendor or somewhere else.
3. Select products for purchase
The next step in the merchandise buying process is to choose which products you want to buy and sell on behalf of your retailer after you’ve negotiated pricing with the manufacturer. Most buyers of goods have a predetermined number of units in mind, but the actual goods they get may differ depending on the season, location, economy, and product availability. Keep a thorough record of everything you intend to buy to prevent buying multiples of the same kind of item, such as 10 orders of 1,000 pairs of jeans from various brands.
4. Purchase merchandise for retailer
Purchasing the goods for the retailer with company money is the last step in the merchandise buying process. Several different purchasing procedures are employed by manufacturers and buyers, such as consignment, which entails the creation of an agreement in which the retailer agrees to pay for the goods once they have been sold. Others may bargain the purchase of goods at regular intervals to expedite future bargaining For instance, a hardware store may decide to schedule routine purchases and shipments of paint because they know they will need certain brands and colors throughout the entire year.
What is merchandise buying?
Purchasing merchandise from producers to sell on their behalf is a crucial aspect of retail management that involves retailers finding the products they want to sell. Some businesses decide to buy their goods exclusively from manufacturers, while others develop their own brands, or private labels, for the company. The majority of large-scale retailers have entire departments devoted to purchasing merchandise, and employees may be given various assignments regarding what they must buy. For instance, a department store might appoint one employee to handle home goods purchases, while others concentrate on shoes or accessories.
Additionally, it’s typical for retailers to have smaller, more regionalized merchandise buying teams that can address the preferences and requirements of particular populations or regions. Because the needs of the clientele vary depending on the region’s climate, national retailers in Florida may sell lighter winter coats than those in the Midwest. When deciding which products the store needs and how many units to fill the shelves, merchandise buying teams frequently collaborate with inventory departments.
Duties of a merchandise buyer
The success of a merchandise buyer’s employer, which is typically a retailer, can be significantly impacted by a number of their responsibilities. Here are some of a merchandise buyer’s primary responsibilities and why they’re significant:
Buying plans
Making buying plans that specify what the retailer wants, the prices they’re aiming for, and the quantity of units they need to meet consumer demand is one of the main responsibilities of a merchandise buyer. Product buyers may decide to collaborate with their coworkers to come up with the most efficient ways to buy the products they need when developing buying plans. Higher-level staff members who oversee merchandise buying departments frequently ask to review and approve buying plans before putting them into action.
Cross-examine vendors
Cross-examining various vendors to determine which ones best meet the needs of the retailer is another responsibility of merchandise buyers. A buyer of goods may decide to maintain a detailed list or spreadsheet of each manufacturer’s costs, specifications, and reputation in the retail industry. The effectiveness and accessibility of the goods a retailer sells can be greatly influenced by all of these elements, and this can have a direct impact on customer satisfaction.
Assigning prices
Assigning prices to items may also fall under the purview of merchandise buyers. When setting prices for goods, there are numerous factors to take into account, including the caliber of the materials used, the wholesale cost, and the retailers’ sales targets for the respective fiscal quarter or year. Buyers of goods are responsible for determining fair prices that consumers are willing to pay based on these factors. Additionally, they can create promotions that allow customers to save money by purchasing particular or bundled items.
FAQ
What is merchandising planning and buying?
Planning and buying of merchandise describes how retailers forecast their needs for inventory and negotiate the best prices with suppliers. For the chain, retailers typically have a centralized buyer or team of buyers manage this process.
What is an example of a merchandise?
Any item you can sell or buy is referred to as merchandise. Anything offered for sale is considered merchandise, with foodstuffs in a supermarket, clothing in a retail setting, electronics online, or raw materials in a manufacturing facility serving as a few examples.
Is buying and merchandising the same?
A retail buyer focuses on product. They are in charge of choosing the goods that are displayed in stores or online after conducting research on fashion trends. Retail merchandisers ensure commercial and financial viability of the product.
What is the merchandise process?
Understanding customer needs, locating and choosing the appropriate merchandise, choosing the appropriate assortment, planning the distribution of the merchandise to various locations in the right quantities, choosing the pricing, communicating the merchandise offerings to the target customers, and
