Performance Analysis Tips from an Experienced Merchandiser
Inventory planning should not be a guessing game that is based on a few simple sales metrics. It requires experience and deep market knowledge. As a fashion brand merchandiser, there are several performance analysis tips you can use to make better decisions, optimize your product offerings, and improve your bottom line. Before we dive in, let’s discuss what merchandise planning is and the impact it has when done successfully.
What is Merchandise Planning?
Merchandise planning is a strategic process that involves analyzing sales data and market trends to make informed decisions about what products to stock and how much inventory to carry. The goal of merchandise planning is to ensure that a business has the right products available in the right quantities at the right time to meet customer demand and maximize profits.
With that in mind, here’re a few tips to better your merchandising strategy –
1. Study customer behavior: Understand your customer's preferences, needs, and behavior. Use data analytics tools to track customer purchase patterns, browsing history, and feedback. Use this information to tailor your product offerings and marketing messages to your target audience.
2. Analyze sales data: Look at sales data from previous seasons to identify which products sold well and which did not. Use this information to determine which products to carry forward and which to drop from your fashion line.
3. Monitor inventory levels: Keep track of inventory levels and adjust your ordering and restocking strategies accordingly. You make these adjustments in inventory to prevent costly markdowns (in aged stock) that eat into your profit margins as well as the possibility of missing sales.
4. Monitor pricing and promotions: Analyze the effectiveness of pricing strategies and promotional campaigns. Identify which discounts and promotions generate the most revenue and adjust your pricing and promotion strategies accordingly.
5. Track competitor performance: This one is often overlooked– Keep a close eye on your competitors' pricing, product offerings, and marketing campaigns. Use this information to identify gaps in the market and areas where you can differentiate yourself.
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