Being a merchandiser is tough. I know, because that was my job before I joined the EDITED team. One thing I learned right away is that the best retail decisions come from the killer combination of an analytical mindset and a love of fashion. As a merchandiser, those two attributes power the right decisions when you’re creating stock plans, assessing allocations and optimising on sales volumes.
If you’re already a merchandiser, hopefully you’ve checked off the ‘loving fashion’ bit. But what turns a good merchandiser into a superstar merchandiser? Here are three traits I’ve seen in the best merchies (btw, that’s UK lingo – merchandisers in some countries are called planners or allocators) that make sure they’re getting the right products to their customers at the right price – and particularly at the right time.
1) An Aversion To Tardiness!
“I’m late, I’m late!” is something you’ll rarely hear the industry’s best merchandisers declare. Being a good merchant is all about telling the retail time well. Knowing ahead of the customer when they’re going to want something, and accurately planning how long that demand is going to last, is critical.
Bringing stock in too early means that your customer doesn’t want it yet. You’ll end up with dead stock that’s going to need discounting. It’s far from ideal. On the other hand, bring it in too late and you’ll lose credibility with your customer who by that point might have bonded with your faster-thinking competitors.
Timeliness is more prevalent now than ever before. Since the financial crash, retailers have talked about a shift to a ‘buy now, wear now’ attitude. Customers want to buy clothes when they need them rather than buying them months in advance and letting them sit in their wardrobes. Merchandisers need to understand the products and styles in their market and be able to detect commercial movement to up or downgrade stock at just the right time.
Data is their BFF. It informs demand forecasts ensuring they’re not left with duds. And it also reveals areas for promotional opportunities. Armed with commercial and consumer insight, the best merchandisers have a harmonious relationship with promo or marketing teams, capitalising on timing.
2) A Healthy Relationship With Markdowns
Despite all of us in retail wanting to maximise full price sales, markdowns are part of the industry. Customers like a bargain, and retailers need to clear old products to make space for new stock. Launching products at the right time is closely linked to minimising markdown percentage.
A real-life example: This year H&M launched swimwear at the same time in the US and the UK – early February through late March – and saw very different results between the two. In the US, only 54% of products were ever discounted by 44%. However, of the exact same products in the UK market, 70% were marked down by 57%. Of these styles, 20% were replenished. Arguably, merchants at H&M could have saved some markdown spend had they chosen not to replenish these products (incidentally, one of the replenished, discounted products in the UK is still full price in the US so perhaps the replenishment stock could have been sent to the US instead).
The best merchandisers aren’t afraid of markdowns. They’ve got a healthy respect for getting discounting right. A product with a shorter lifespan than hoped for stings. But they’re able to move fast, detecting warning signs early, cutting their losses to save margin ahead of bumpier waters.
A product with a unexpected short lifespan stings but good merchandisers aren’t afraid of markdowns. tweet
3) Maintain Balance
No, I’m not talking about yoga, though on a particularly frantic day some of that inner calm would be nice! Being a merchandiser is a juggling act. There are constant calculations about how many products should be fashion-forward versus how many should be safe. We’ve all been involved in a
battle of wills debate with our more creatively-driven counterparts, right? Usually it’s over the eternal hunt for the money-makers with a good intake margin that sell year after year.
Good merchandisers strike that balance, taking calculated risks which are offset by good sense. How do you know if you’re that kind of person? You’re into new bands before they’re playing Madison Square Garden. You’ll probably have a keen eye for a smart investment – the kind of person who scoops an apartment in a once-dodgy area mere weeks before the local press does a two-page review on how cool it’s becoming. Or perhaps you just prefer the coffee place where your latté might taste 7% worse but you get served 25% faster, thus you win.
Top merchandisers strike the balance of commercial & directional, offsetting risk with good sense. tweet
As a merchie, it’s important to trial new trends but you have to make sure that the products you’re buying are what your customer wants. You’ve got to know your customer and know whether they’ve been an early adopter of trends in the past. On that tightrope, it can be easy to lose footing.
Take culottes, a trend majorly touted by the press this time last year, and a big hit in the luxury market. Although 60% of the products that came onto the market place between August and November last year came from mass market retailers, these products took an average of 162 days for a first sell out and had an average discount percentage of 57%. In the luxury market products took an average of only 20 days for a replenishment despite an average price point of £262. Combining these facts would indicate that on the whole, mass market retailers who bought into the culotte trend last year lost out.
Meanwhile, mass market retailers who bought into printed trousers last Fall probably saw more success, despite that trend having been around for a few years. Printed trousers that first dropped in the same period as the culottes only took an average of 39 days for a first sell out and 50% of the products sold out without being discounted.
The mass market might not have been ready for culottes last Fall/Winter but since the start of August this year, new products arriving have taken just 24 days on average to sell out. The timing is much better suited and a well-balanced mass market merchandiser would have used data to draw that conclusion.
So to sum up – merchandising isn’t easy. I get it. In fact, I’ve made it my job to make your job easier. It helps that many of my colleagues have also worked as merchandisers or buyers and designers. Together, we’ve got your back.
The data in this piece was pulled from EDITED. Want to see how to do it yourself? Get a demo.