Merchandising and what it can do - The business side of product business
There are two kinds of merchandising in retail, the financial kind and the visual kind. Both are really important to how brands can grow as one looks after the business and the other shows the customer the creative side at its best. They are two ends of the buying process that support making great sales and ultimately how you make decisions as your product business moves forward.
In this post I’m going to talk you through merchandising and what it can do – the business side of product business, including:
- What a financial Merchandiser does
- 5 Benefits of having a financial Merchandiser
- Time to focus on the product
- Creating a sales plan
- Advice on pricing
- Stock strategy support
- Implementing key performance indicators
- Why getting a financial Merchandiser to work with you on your product business could speed up how your brand could scale and also give you all the tools you need to make better buying decisions.
It’s a little bit of merch magic…
If you would like me to take your data and create the insight you need to push your business strategy forward or put in processes to that give it to you then I can help!
What a Financial Merchandiser does
Buyers work hand in hand with Merchandisers, in fact, the teams are often called the B&M department because they usually do everything together. Both are creative in their way, the Buyers will be focussing on curating or developing products that their ideal customers will love and the Merchandisers will be creating the budget and sales plan that will enable sales and profit growth.
5 Benefits of having a Financial Merchandiser
1. Time to focus on the Product
Having a Merchandiser who can look at the numbers while you focus on the product means you can leave some of the process to someone who loves it and I mean LOVES it. Merchandisers are spreadsheet fiends, they will take your data and put into to a tool that will give you the insight you need to know about how good your products actually are so you can make decisions on what to do with them.
And that’s my background, I have been in Merchandising and Stock and Supply chain for nearly all of my retail career so I know that Merchies know their way around a spreadsheet and how to find the opportunities for you to make more profit and sales for your product brand.
2. Creating a Sales Plan
Their experience in retail will mean they have the skill to help you form the sales plan you need to do what you want to do. This can be a scary prospect for some as you need to take a leap of faith to put a bigger number in and then go for it. A Merchandiser will look at your previous sales data, find trends and also opportunities that you can build your range on to bring in more cash. Crucially they will bring things to your attention that could be changed or dropped so you spend less time working on products that don’t give you the best return.
3. Advice on Pricing
They can help you build your range and look at your pricing so you are hitting your profit goals from the start. Creating the right hierarchy helps customer shop your offering in the right way and ensure the value of your products is reflected in what you charge.
They will know if you’re on track to hit your goals and guide on you how much you should be investing in stock to keep going. They can support decisions on when to order more or to phase your PO’s in a way that makes sense for your cash flow.
4. Stock Strategy Support
In the same way they will also tell you if you have too much stock and what could be right for promotion, this is so important to keeping your mix clean and for driving sales profitably. How your brand is perceived will be really important to you so your freelance Merchandiser will help you create a promotional plan that fits with how you want to run your business.
We will create the ideal buy quantities and we can also determine how many products you should be buying to support the sales you want to take. This is the dark art of option planning and it is a great way to determine if you are over or under buying product selections. Sometimes you may need to increase your offering to get the increased sales you want and sometimes you will need to make choices so your cash is spent in the best way – we can help you do that too.
5. Implementing Key Performance Indicators
Using key performance indicators (KPIs) they will tell you what’s great, what’s average and what is not working right now. These are metrics that you will soon wonder how you ever did without once they are in your business. Your Merchandiser will track these and you can determine between you what good looks like whilst using them to support your planning so you know when a product is adding benefit to your range and sales and importantly when it isn’t. They will make recommendations on which KPIs to target so you are achieving the goals you really want as the foundation of your brand.
You will be able to make timely decisions because they love the planning process and they will be able to create a critical path that you can use to provide structure to what you do. This will show you how to Plan, Buy, Sell and Review so you keep taking those learnings and opportunities while building your product business strategy continually.
Why getting a financial Merchandiser to work with you on your product business could speed up how your brand could scale and also give you all the tools you need to make better buying decisions.
You may need one of these elements or you may want them all but a freelance Merchandiser will be an excellent addition to your team and can provide skills that frees you up to focus on the product and creative focus of your brand. They live for product like you and will enhance what you do with the numbers so you know your decisions are really robust and strong.
If you are in the growth stage of your brand then it’s a good time to bring someone in to help you create the tools you need to track your KPIs and your goals. That focus will pay you back with opportunity to push sales and profit margin up and manage your stock levels so you are investing well.
You will know when the time is right to focus on the business side of your business and a Merchandiser could provide you with insight and data in a way that supports your needs. It is a specialised skill set that has evolved with retail to focus not only on product but channel and customer experience. This has never been more important as our industry is moving fast as consumer needs and habits have changed vastly in the last 12-18 months and will continue to do so.