This week I got to talk to Jen Slater (@jenslater) who worked as a merchandiser since she left university in 2000. Jen has worked for River Island, Selfridges and Ernest Jones (Signet) where she worked with prestige watch brands such as Rolex, Omega and Breitling. She left this role to work at This Modern Life so that she could have more time for her children.
A merchandiser analyses the numbers, they control the stock levels and monitor sales trends to make sure that the buying budget is spent on the right products at the right time and that those products are sent to the right stores to maximise profit. In short, they hold the purse strings and they work closely with the buying team.
What are the various roles in the buying team?
This differs from company to company but in its most basic form, starting at the bottom are the buyers admin and allocator who work together, then an assistant merchandiser and assistant buyer work above them. A buyer and merchandiser head up the team. They report into a buying and merchandiser controller who then usually reports into buying or merchandiser director.
How involved in the buying process is a merchandiser?
This has been varied in my roles too. At Selfridges I had very little involvement, although I went on some buying appointments, I was there for the numbers. At Signet I went on trips and was very involved as I was very involved in the analysis and had close relationships with the brands we saw. Buyer always had final say in a selection, but my opinion was always listened to and trusted.
How far in advance do you start planning what to buy? What are the steps in the buying process? and who has the final say?
Again, varies by company. At Selfridges we had 2/3 months sometimes to plan in 'holiday buys' (seasonal) from some brands like Ralph Lauren / Armani etc. Usually however it’s a full 6 months ahead. In own buy (products made under the retailer’s brand) at River Island we would plan a whole year and then trade up to the six months and amend as needed.
In terms of 'steps' in its basic form it starts with an OTB number (Open to buy, how much money you have to spend) and a sales plan number (how many units or cash you have for a period, comes from finance and agreed with CEO / CFO etc). Use the sales number to work bottom up, either by planning store sales or brand sales for the season and match it back. Then apportion OTB based on growth plans for the season. Eg. if you think Kors is going to grow by 5% and have more stores, you will need to grow its OTB accordingly. Also, depends on how much stock you will open a season with and how much will be sold out in sale. Lots of pro rating was generally used! Final say always lies with the buying / merch director at sign off meetings.
How do you set the strategy for what to spend money on and with whom?
Strategy came from meetings with both buyers and brands. Seeing what growth, they planned for themselves as a brand and we would plan similar as long as we believed in it. Obviously, also depends on OTB available from company as a whole.
What sort of information are you usually happy to share with the supplier?
We would only share sell through. We wouldn't share any information on any other brand obviously due to competition law. What we could share though was store performance and shopping centre performances overall etc.
What sort of questions can you as a merchandiser help the supplier with? What should they ask you for?
We can't share info on other brands as its against competition law. We can share store data and % of mix that brand takes in a store. We can't share £K figures for obvious reasons. Information on trend overall is always given as is footfall data and information that’s in the public domain rather than info which is specific to other brands.
What can a supplier do to increase their chances of getting a big order? How can they make your job easier?
Be professional and realistic. Make margins good for us and make stock available. Offer exclusives. That always went down well when we worked with new small suppliers!
What day is the best day for a supplier to contact a buying team?
NEVER Monday!! Wednesdays are always calmer.
What advice would you give to a small/young business that wants to start selling to a bigger retailer?
Think about the pitch and your customer. Where do you see yourself ultimately and who are your competition? What discounts would you be willing to offer, big retailers will ALWAYS ask for them! Discount for early payment / discount for late delivery / discount for faults on goods etc. its endless. Make sure you can afford to give them. Always back up product with replenishment. If goods sell out and you can't get back into stock quickly big retailers will move onto the next thing and not come back!
I really appreciate Jen taking the time to answer these questions, I appreciate that this post is a little bit longer than my normal mini story but I thought I would take the opportunity and ask a few extra things that I hope you found interesting.
Some of the terms used in this blog might sound foreign to you and it might seem like they are not that useful to you right now. However, knowing what various things mean will help you come across professional and trustworthy when in front of larger retailers.
Asking the right questions and finding out more about their OTB’s and what’s been allocated to your brand will help you forecast what stock you will need and what cashflow you need to support this buy in.
It’s always worth asking as for the sell through as again it will help you forecast what stock you will need. Having stock available for re-order at a short (weeks rather than months) lead-time can really help you grow your presence with the retailer over several seasons. Of course, this is still a guessing game at this stage and an order is not confirmed until you receive a purchase order and even with a purchase order make sure that you read their terms and conditions as some reserve the right to cancel orders very close to the delivery date which for a small business could be devastating.
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