Buying and Merchandising of Monsoon - Essay Example

Monsoon: Buying and Merchandising Table of Contents Table of Contents PART A: Introduction 2 0Introduction 2 2.0Roles and Responsibilities 2 2.1Buyer 3 2.2Merchandiser 4 3.0Development of a Fashion Product Range 4 4.0Creation of a Fashion Product Range 5 5.0Supply and Delivery of a Fashion Product Range 6 PART B: Monsoon 8 6.0Brief 8 6.1Introduction 8 6.2Trend Analysis 8 6.2.1Survey 8 6.2.2Distributional Channels (Stores) 9 6.2.3Spring/Summer 2013 10 6.3Range Plan 10 7.0Justifications of Product Aspects 11 7.1Style/Colors 11 7.2Fabrications 12 7.3Fashionability 12 7.4Pricing & intake margin strategy 13 8.0Monsoon Target Customer Profile 13 9.0Trend Analysis Summary 13 10.0Supply and Sourcing Strategy 14 Bibliography 15 Appendices 16 Appendix 1: Survey 16 Appendix 2: Range Plan 18 18 Appendix 3: Core Categories 19 Appendix 4: Fashion Style Categories 20 Appendix 5: High Fashion Category 21 PART A: Introduction 1.0 Introduction The creation of a successful product range is a fundamental requirement of a fashion business. The product offered is not just the physical articulation of a brand and its personality, but also the brands source of income (Goworek, 2007). Ensuring that all product ranges are relevant to the brand but also balanced as a source of income is the responsibility of the buying and merchandising function within a fashion business. Buying and merchandising functions vary from one organization to another (Jackson & Shaw, 2001). Consequently, role of the buyer and merchandiser will definitely vary from one organization to another depending on the operations or activities of the firm in question. Whereas buyers have a specific role in ensuring that there are productive relationships with suppliers besides negotiating on various important details that includes prices, exclusivity, and well as the distribution channels. On the other merchandisers are usually responsible for ensuring that an organization’s stock performs well within the market. Nonetheless, both merchandisers and buyers perform different functions in respect to organizations. The following discussion aims to develop a critical understanding of the various roles and responsibilities of buyers and merchandisers. The breath of activities that the buying & merchandising function undertake in delivering this requirement successfully is explored in this paper that comprises two parts (Jackson & Shaw, 2001). The paper also creates an understanding of development, creation, supply, and delivery of a fashion product range in respect to buyers and merchandisers (Goworek, 2007). 2.0 Roles and Responsibilities Buyers and merchandisers play a significant roles and responsibilities towards ensuring that there is a fashion product range capable of meeting the demands, tastes, and preferences of consumers (Goworek, 2007). Firms involves in fashion development have to create effective product range that will definitely take care of all the existing and potential customers. The following are some of the functions of buyers and merchandisers in respect to fashion industry. 2.1 Buyer A typical buyer has various roles and responsibilities in ensuring that there is a good fashion product range that meets the demand, tastes, preferences, and needs of the consumers (Goworek, 2007). One of the functions of buyers within buying and merchandizing involve monitoring and maintaining of the gross margin plans through engaging in controlling markups, shortages, stock levels, markdowns, and turnovers. A fashion buyer has the role and responsibility of reviewing past season’s ranges in order to forecast on the existing and future seasons within the research. In addition, fashion buyer within Monsoon develops options from heard stories and their interactions with the clients besides reviewing and researching both past and current trends in a bid to be able to provide a light on the possible future trends. The future trends are important in ensuring that the organization is in good tract. Other roles and responsibilities of fashion buyers include deciding on the supplier base as well as reviewing available samples before eventually finalizing applicable options, reviewing quality assurance as well as delivery in respect to warehousing, and within distribution, shipping, and retailing they approve final samples for shipment, provide guiding displays within the stores, and reviewing performances, repeats, as well any possible cancellations. Lastly, buyers have the role of selling to customer until the end of a given season. Monsoon Company benefits from the above roles and responsibilities of the fashion buyers, which have made the organization very effective and have competitive advantage over its rivals. Competitive advantage has assisted Monsoon firm within the fashion industry to continuously attain their targeted profits and sales. 2.2 Merchandiser Merchandisers are considered the brain behind any firm’s operations especially with respect to buying and selling of products (Varley & Rafiq, 2004). After all, merchandising is all about planning and developing effective and appropriate strategies that enable firms in question to sell a given range of products with a view of attaining some specific sales and profit targets (Jackson & Shaw, 2001). In planning merchandisers are not involved directly in purchasing of various merchandises but are responsible for formulating or developing efficient and effective policies with respect to their areas of merchandise. Such policies include forecasting sales, estimating possible demands and the possible impact of any possible changes within the environment. Merchandisers are usually involved in directing functions, which include guiding and training buyers in respect to merchandising functions. It is not a sin for buyers to be give the required guidance and training on how to develop and meet markdowns for products. Another role and responsibility is coordinating. Merchandisers are involved in coordinating various functions within the firm in question. Whereas coordinating involves supervision functions, controlling roles and responsibilities involve assessment of performance of merchandise and buyer. Lastly, in respect to controlling, merchandisers have the role and responsibility of controlling various functions within the fashion firm or industry. Indeed, Monsoon is what it is today because of the effective and efficient merchandisers within the firm. 3.0 Development of a Fashion Product Range Both the buyers and merchandisers have a role in the development of a fashion product range. In most cases, development of a fashion product range is attained through various roles and responsibilities played by the buyers and merchandisers. For instance, buyers contribute significantly to the development of a fashion product range through the mutual and productive relationships they maintain with consumers. Such mutual and productive relationships will enable them to identify the demands and needs of the consumers hence in a position of advising the merchandisers in enhancing development of a fashion product range. In addition, buyers use the returned merchandise to evaluate the needs and demands of the consumers hence developing a fashion product range. On the other hand, merchandisers have roles and responsibilities that enable them develop a fashion product range, which will meet the requirements, needs, demands, and tastes of consumers. Merchandisers through the planning function are able to come up with effective ways of policies that will enable them develop a fashion product range. In most cases, development of such fashion product ranges usually follow the needs, demands, and requirements of the consumers based on information obtained from the buyers as well as conducted market research. Indeed, merchandisers have a great contribution towards development of a fashion product range that meets the demands, preferences, and tastes of the consumers. 4.0 Creation of a Fashion Product Range Other than development of a fashion product range, both buyers and merchandises significantly contribute towards creation of a fashion product range. Even though buyers do not have explicit roles and responsibilities towards creation of a fashion product range, their contribution towards creation of a fashion product range relies on the information they provide and this should not be undermined. As in the case of development of a fashion product range, buyers contribute to creation of a fashion product ranges through their roles and responsibilities. Buyers have the role and responsibility of handling merchandiser return as well as policies that would make it possible for them to ensure that a firm has adequate ways of meeting the needs and wants of the consumers. Buyers play a significant contribution in the creation of a fashion and product range. Merchandisers also play a significant role in creating effective and efficient fashion product ranges. Through planning, controlling, and coordinating, merchandisers are able to create effective fashion product ranges that would meet the demands, tastes, and preferences of the consumers. Merchandisers develop effective and efficient policies for forecasting and creating required fashion product ranges. One of the key aspects of merchandisers is to select appropriate merchandise that should be taken into the market. Selection of appropriate merchandises is one aspect of creating a product range. Within fashion firms or industries, merchandisers have the capacity to come up with effective fashion product range capable of meeting the demands and preferences of the consumers. In this perspective, merchandisers significantly contribute to the creation of a fashion product range with specific requirements that would meet the demands of the consumers in question. 5.0 Supply and Delivery of a Fashion Product Range Supply and delivery and important functions that complete production cycle in respect to development, creation, consumption of specific products. Therefore, without supply and delivery the manufacturing process becomes meaningless (Christopher, 2010). Buyers and merchandisers contribute significantly in supplying and delivering of a fashion product range. Buyers are charged with responsibility and roles of coordinating purchasing of the merchandises. The role or responsibility of coordinating purchases amongst the consumers complete the production function through engaging supply and delivery functions. In addition, buyers have the responsibility of making appropriate decisions in respect to merchandising activities. Merchandising activities involve the aspects of supply and delivery (Varley & Rafiq, 2004). Therefore, there is no doubt that buyers contribute significantly in supply and delivery. Roles of merchandisers in respect to supply and delivery are evidence enough to understand the contribution of the same (Christopher, 2010). For instance, merchandisers have the role and responsibility of directing functions of buyers. Buyers have to be trained and guided in order to ensure that all the activities involved in supply and delivery are effectively attained. Moreover, merchandisers also have the responsibility of coordinating and controlling activities related to merchandising (Bocij et al., 2008). All these actions, roles, and responsibilities are a great and significant contribution towards ensuring that the supply and delivery of a fashion product ranges are fulfilled in respect to sales and profitability targets. From the above discussions, there is enough evidence that buyers and merchandisers are very vital within the process of buying and merchandising especially within fashion industry or firms (Jackson & Shaw, 2001). Notably, even though the functions, roles, and responsibilities of buyers and merchandisers differ greatly, there is no doubt that they enhance development, creation, supply, and delivery of products. What’s more, most of the roles and responsibilities of the buyers and merchandisers are correlated. Therefore, every firm or organization especially involved in development, creation, supply, and delivery of various ranges of product should ensure that there are effective buyers and merchandisers within their cycle of production. PART B: Monsoon 6.0 Brief 6.1 Introduction It is October 2012 and the Monsoon Head of Buying and Merchandising has requested that you put together ideas for a Spring/Summer capsule collection that captures the essence of Monsoon and the predicted trends for the season. The new collection will be ranged in 5 flagship stores for a 12 week lifecycle from 1st December 2012 to 28th February 2013. You have been given a maximum open to buy budget (OTB) of £275,000 to spend on the range. Based on primary research in respect to the Monsoon Company and its products and activities of both buyers and merchandisers, the following is a creation of 12 option capsule collection. In addition, the following discussions provides inspirations by detailing specific information on style/colors, fabrications, Fashionability, pricing, and intake margin strategy. 6.2 Trend Analysis 6.2.1 Survey According to a survey conducted within the Monsoon, the majority of client asked about their choice of products, dresses and formal wear formed the bigger part of response. In addition, the majority of the respondents in the survey confirmed that they spend £45 on average, £60 on casual, and £150 on formal wear. Even though much emphasis should be placed on formal wear, there is need for effective policies and strategies that will also promote or enhance the purchasing of casual wear. The survey also confirmed that the majority of consumers are above 25 years with a fusion range of 20 years. The unique selling point for Monsoon as identified from the survey was the fact that the organization has ethnic prints, bohemian look, and many core pieces. Another important fact discovered during the survey was that consumers purchase from Oxford Street store given that it provides while outfit and given the variety in selection. Lastly, the majority of surveyed individuals confirmed that they come to Monsoon for gowns and dresses. As a result of the above survey, it is important that whilst developing the range plan, there are different aspects should be taken into considerations. Firstly, there is need to consider the fact that dresses, gowns, and formal wear are the mostly bought products from Monsoon. In addition, it is true that majority of buyers within Monsoon are above 25 years with a fusion client of averagely 20 years old. Monsoon’s much of the produce or sales are driven from the formal wear and the fact that ethnic points are the major attractions features within Monsoon products. Another aspect to take into considerations includes the fact that increasing variety of stocks will definitely pull in customers 6.2.2 Distributional Channels (Stores) Four main stores that will be used in distributing the products along the Oxford Street include St. Pancras station, Kings Road, Holborn, and Pen Portrait. All the Monsoon stores are located on Oxford Street because they are on both end of Oxford Street next in the busy areas, which also have many options in their store. Such characteristics or features already attract customers to those locations, hence increasing capsule collections and profitability (Monsoon.co.uk). All these stores are selected in a bid to enhance the interaction time between the Monsoon Company and the clients or potential clients. Monsoon in St. Pancras station is selected as a distribution channel given that it is near a large fashion college, as well as people coming in and out of London. The fashion college and the increased persons coming to London will be able to view the capsule collection from monsoon when they enter whilst the students coming to shop there during leisure hours have a chance of adding to the capsule. Kings Road is selected as one of the distributional channel due to the fact that it is near Knightsbridge, which is the shopping area for many international people (Monsoon.co.uk). Lastly, Holborn will also be a distribution channel given that there are many business building; the women may come for shopping during their breaks. Monsoons target market is women who work but want a flare to their style. 6.2.3 Spring/Summer 2013 Depending on the spring/summer 2013 and the past trends, it is clear that Monsoon has better chances in selling dresses to women. Women are the majority of customers for Monsoon products and the majority of them buy dresses. The following is Monsoon Range Plan for some of the main dresses that attract many women customers hence the need to have adequate strategies and effective measures to attain the demands, tastes, and preferences of the customers. Since dresses are the core of the business, it was the epicenter of the range plan. 6.3 Range Plan In developing the range plan, it is important to consider the unit buys as well as the number of stores that will be involved in the supply and distribution of the products. The following are some of the formulas used in developing the range plan attached below: The unit buys calculation for each option is calculated by the formula: {(Rate of sale * Lifecycle) / Sell through rate} * Number of stores For instance, Unit buys = (15 * 12)/80% = 225 units * 5 stores = 1125 units On the other hand, the option range plan is completed by calculating the cost and selling values of the product range. The cost value represents the value of the cost prices whereas the selling value represents each options contribution to the spending of the OTB budget. The calculation for each options value is as follows: Unit buy * cost price = buy cost value Unit buy * selling price = buy selling value From the above formulas and concepts, the optional range product plan is developed in a bid to understanding how Monsoon can be able to put together ideas for a Spring/Summer capsule collection that captures the essence of Monsoon and the predicted trends for the season. 7.0 Justifications of Product Aspects The following is the selected Monsoon Product Range Plan based on the survey as well as identified trends in fashion Spring/Summer 2013 Monsoon Range Plan Option Description Colour Fashionability Cost Price Selling Price Intake margin Rate of sale Life cycle Sell Through rate % Total Buy Units Total buy cost value Total buy selling value 1 Florrie Dress Blue Core £23.04 £79.00 65.00% 10 10 80.00% 625 £14,401.04 £49,375.00 2 Neesha Dress Pink Core £13.13 £45.00 65.00% 10 10 80.00% 625 £8,203.13 £28,125.00 3 Sienna Sequin Gold Core £23.04 £79.00 65.00% 10 10 80.00% 625 £14,401.04 £49,375.00 4 Carmel Bridal Dress Silver Core £24.79 £85.00 65.00% 10 10 80.00% 625 £15,494.79 £53,125.00 5 Parva Dress Blue Fashion style £10.21 £35.00 65.00% 8 8 70.00% 457 £4,666.67 £16,000.00 6 Alpine Jersey Dress Brown Fashion style £3.00 £39.00 65.00% 8 8 70.00% 457 £1,371.43 £17,828.57 9 Nina Dress Black Fashion style £11.67 £40.00 65.00% 8 8 70.00% 457 £5,333.33 £18,285.71 10 Sarina Stripe Dress Multi High Fashion £13.13 £45.00 65.00% 4 4 60.00% 133 £1,750.00 £6,000.00 11 Leon Knit Dress White High Fashion £13.13 £45.00 65.00% 4 4 60.00% 133 £1,750.00 £6,000.00 12 Murcia Teddy Dress Grey High Fashion £11.67 £40.00 65.00% 4 4 60.00% 133 £1,555.56 £5,333.33 £249,447.62 Fashionability mix selling value Core £180,000.00 OTB budget £275,000.00 Fashion £33,828.57 High fashion £35,619.05 £249,447.62 7.1 Style/Colors The style/colors selected are those confirmed to be feminine. Majority of women especially with respect to the Spring/summer 2013 trends, tend to like colours that are not only bright but also feminine. As a result, the above range plan involves different colours that would match the demands for women especially in respect to dresses. The dresses have to be of different colours in order to meet diverse needs of the customers. According to Brown (2012), colour forecast indicates that for spring 2013 women are likely to go for warm and sunny colours. Based on these aspects, the above product range plan is developed on the basis of sunny and warm colours. 7.2 Fabrications Fabrication is an important aspect of fashions. Fabrications will include both woven and knitted fabrics that allow Monsoon to meet the expectations and demands of diverse consumers. Different consumers prefer various fabrications hence the need to have products made of diverse fabrics (Monsoon.co.uk). According to the above product range plan, all the three levels of Fashionability are sensitive to fabrics in a bid to ensure that diverse needs and demands of the consumers are met in respect to fabrications. 7.3 Fashionability Fashionability includes core, fashion, and high fashion. Core Fashionability includes products that are bought in large quantities while the fashion categories are those that are bought in medium quantity. High fashion categories are those that are bought in smaller quantities. Flories, Neesha, Sienna, and Carmel are dresses that form the core since they are bought in large quantities even though their prices are relatively high (Appendix 3) (Monsoon.co.uk). On the other hand, Parva, Alpine Jersey, and Nina are dresses that form the fashion style whilst Sarina, Leon, and Murcia Teddy are those that represent the high fashion category even though they have relatively low prices (Appendix 4 and 5) (Monsoon.co.uk). Evidently, the trend indicates that people tend to shift towards high-priced products in as long as they have the desired qualities. 7.4 Pricing & intake margin strategy Pricing is an important strategy within fashion firms and industries. In most cases, pricing and intake margin strategies depend entirely on the consumer behaviors as well as competitive advantage. In the above Monsoon Product range Plan, pricing strategy used is that which identifies the products liked so much by the consumers, the cost of production, and the competitors’ prices. Pricing strategy for Monsoon is important given that it will enable the firm to identify effective and prevailing prices that should be charged in order to meet target margins and profitability. 8.0 Monsoon Target Customer Profile Majority of customers that buy Monsoon products are mainly women who buy dresses and other formal wear. Women customers that buy products from Monsoon range above 25 years of age. In this respect, it is true that the clientele profile is made up of mature women who may want to be presentable in order to attract suitors. Monsoon has good products that suit the demand of such clientele. Women of such age brackets have a tendency of being presentable in various functions hence the need to have women clientele in the analysis. Thus most of the products identified in the product range plan above attempt to satisfy the need for women products especially those that make them not only presentable but bright and warm as portrayed with the bright colours. 9.0 Trend Analysis Summary Based on the trends visible within the fashion market, it is evident that consumers of clothes especially women continue to go for free dresses that are warm and bright. The trend also indicates that the majority of consumers are aged above 25 years. It means that a lot of concentration should be pressed towards women. On the other hand, the trends indicate that women prefer dresses that are warm and bright hence the need to stock products that have bright colours. Bright colours meet the demand and preference of sunny and warm clothes as portrayed by the summer/spring 2013 trends. 10.0 Supply and Sourcing Strategy Supply and sourcing strategies are important in ensuring that products are not only produced but also distributed in order to complete the production cycle (Christopher, 2010). Supply and sourcing strategies will include effective value and supply chain as well as different stores in order to meet a diverse range of consumers on the same product (Bocij et al., 2008). It is important that Monsoon has various stores from which the products identified will be distributed to the consumers. Indeed, through such effective supply and value chain addition to increased stores will definitely enhance the distribution of identified products. Bibliography Bocij, P. et al., 2008, Business Information Systems: technology, development and management. 4th ed. London: FT / Prentice Hall. Christopher, M.G., 2010, Logistics and Supply Chain Management, Harlow: Pearson (e-book) Goworek, H., 2007, Fashion Buying. 2nd ed. Oxford: Blackwell. Jackson, T. and Shaw, D., 2001, Mastering Fashion Buying and Merchandising Management. Basingstoke: Macmillan. Varley, R. and Rafiq, M., 2004, Principles of Retail Management. Palgrave: MacMillan. Monsoon.co.uk., Monsoon Products. [Online] [Accessed on 4 Dec. 2012] Appendices Appendix 1: Survey A survey was done on the Monsoon, its products and activities related to buyers and merchandisers. Question Response What do people normally go to Monsoon to buy? Dresses, formal wear How much do people normally spend in Monsoon? 45 pounds Average 60 pounds on Casual 150 pounds in Formal wear Who are you main customers? 25+ The Fusion range is 20 years old average What is Monsoons Unique Selling point? They have ethnic prints, the bohemian look, and many core pieces What do people normally purchase in your oxford street store? They buy the whole outfit, Dress wish shoes bad and shrug, because they have more of a selection in this store, compared to the other stores What do people mostly come to Monsoon for? Gowns and dresses The Consumer and buying behaviour What sex is the customer? Female What age? 25 and older, with the Exception of the Fusion Range which is targeted to the younger market Average age 20. How is the customer dressed? Smart/Casual? What does their dress style tell us about the customer? Smart with a flare of colour to their clothes monsoon offers ethnic and floral prints with a bohmien look to give them the smart but fashionable attire. it tells us that the customer is a working female who is taken seriously but on her own time is relaxed, and enjoys fashionable items. What is the fashion sense of the customer? They like prints whether its colors, ethnic, tribal they enjoy colors. as well as the occasional core pieces which is vital for any brand. Is the customer shopping alone or with others? Most of the time on their own, but sometimes with a friend to get the opinion of a formal dress. If possible, speak to sales staff - Who do they believe their regular customer to be? They believe their customers are working women, who like to stand out in a suttle yet fashionable way. Not so much into bright neons, but fashion forward looks. Appendix 2: Range Plan Spring/Summer 2013 Monsoon Range Plan Option Description Colour Fashionability Cost Price Selling Price Intake margin Rate of sale Life cycle Sell Through rate % Total Buy Units Total buy cost value Total buy selling value 1 Florrie Dress Blue Core £23.04 £79.00 65.00% 10 10 80.00% 625 £14,401.04 £49,375.00 2 Neesha Dress Pink Core £13.13 £45.00 65.00% 10 10 80.00% 625 £8,203.13 £28,125.00 3 Sienna Sequin Gold Core £23.04 £79.00 65.00% 10 10 80.00% 625 £14,401.04 £49,375.00 4 Carmel Bridal Dress Silver Core £24.79 £85.00 65.00% 10 10 80.00% 625 £15,494.79 £53,125.00 5 Parva Dress Navy Fashion style £10.21 £35.00 65.00% 8 8 70.00% 457 £4,666.67 £16,000.00 6 Alpine Jersey Dress Brown Fashion style £3.00 £39.00 65.00% 8 8 70.00% 457 £1,371.43 £17,828.57 9 Nina Dress Black Fashion style £11.67 £40.00 65.00% 8 8 70.00% 457 £5,333.33 £18,285.71 10 Sarina Stripe Dress Multi High Fashion £13.13 £45.00 65.00% 4 4 60.00% 133 £1,750.00 £6,000.00 11 Leon Knit Dress White High Fashion £13.13 £45.00 65.00% 4 4 60.00% 133 £1,750.00 £6,000.00 12 Murcia Teddy Dress Grey High Fashion £11.67 £40.00 65.00% 4 4 60.00% 133 £1,555.56 £5,333.33 £249,447.62 Fashionability mix selling value Core £180,000.00 OTB budget £250,000.00 Fashion £33,828.57 High fashion £35,619.05 £249,447.62 Appendix 3: Core Categories Figure 1: Florrie Dress Figure 2: Neesha Dress Figure 3: Sienna Sequin Dress Figure 4: Carmel Bridal Dress Appendix 4: Fashion Style Categories Figure 5: Parva Dress Figure 6: Alpine Jersey Dress Figure 7: Nina Dress Appendix 5: High Fashion Category Figure 8: Sarina Stripe Dress Figure 9: Leon Knit Dress Figure 10: Murcia Teddy Dress Read More