Part 6:
One of the foundational aspects of retail is ensuring the right stock is in the right place, at the right time. This concept, although simple in theory, can be quite complex in practice. With the rise of online marketplaces and the potential to sell globally, the challenge has evolved from just deciding which branches to stock to determining the best online platforms for product placement. This crossover between Merchandising and Visual Merchandising is critical. While Merchandisers focus on orders and distribution of stock, Visual Merchandisers work on product placement, both online and in-store, to drive sales and margin. As the title for each role is so similar, both jobs can be confused within the retail community, but it is an important distinction and requires different skill sets.
A vivid memory of the importance of the accuracy of stock comes from a mistake made by one of my team. He accidentally sent our flagship store the allocation meant for our online business. The sight of countless cages of stock with nowhere to go was a costly mistake, emphasising the need for precise execution in stock management and how double/triple checking is very necessary. We had to make a tough decision to keep the stock at the store and attempt to sell it, which was not ideal but necessary from a profit point of view.
Selling in different locations requires strategic planning. Sometimes stock needs to be physically sent to different locations, while other times it’s virtually ‘ringfenced’ to ensure specific stock is reserved for the required places. This strategy should focus on achieving a better margin management across the different sales channels and countries through either increasing the amount that is sold and/or increasing sales in the highest profit channel which in turn should be bringing in new customers.
Balancing stock requirements and pricing is another critical aspect. Generally, Buyers set the RRP, whilst Merchandisers manage the product lifecycle, deciding when to promote or reduce stock to free up cash flow for new products. This is an important part of the role and shouldn’t be overlooked. The lesson that I learnt in my first ever job was ‘first price, right price’. This is just as significant now then ever as customers are increasingly discerning with their shopping habits and are no longer as loyal as they once were.
