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CHAPTER 8: MERCHANDISE BUYING AND HANDLING - Coggle Diagram
CHAPTER 8: MERCHANDISE BUYING AND HANDLING
Merchandise Management
Acquire from vendors
Handle and store properly
Plan merchandise
Control money spent
Understand customer needs
Dollar-Merchandise Planning
Avoid overstock and markdowns
Aim for profit and stock balance
Plan how much money to spend on stock
Methods (briefly mentioned)
4 types (not detailed in the slides)
Vendor Negotiations
Negotiate:
Delivery terms (FOB factory/destination)
Packaging (custom vs. standard)
Price/discounts (trade, cash, promo)
Dollar-Merchandise Control
Avoid spending too much or too little
Open-to-Buy (OTB)
Monthly buying budget
Helps plan how much new stock to buy
Adjust if sales are more or less than expected
Keep track of spending on stock
Common Errors
Wrong product (design, color, size)
Too trendy products
Wrong pricing
Poor stock planning
Too many suppliers
Late communication with vendors
Inventory Planning
Merchandise Mix Dimensions
Variety: Different product lines
Breadth: Different brands in a line
Depth: Items (SKUs) within each brand
Constraining Factors
Market conditions
Space and vendor limitations
Financial limits
Match inventory with customer demand
Decide how much and when to buy
In-store Merchandise Handling
Check invoices
Prevent shrinkage (loss from theft/damage)
Check stock on arrival (quantity & quality)
Types of Shrinkage
Employee theft
Administrative errors
Vendor fraud
Shoplifting