FBS Session I

FASHION BUYING & SOURCING

Session I

INTRODUCTION TO BUYING FUNCTION

What we will cover…..

•Introduction to buying function

•Role in contemporary buying

•Central buying for chain organisation

•Types of centralised buying

•Buying for full line and specialised operations

1. Specialty

2. Department

3. Variety

4. Discount

5. Boutique

6. Franchise

TYPES OF STORES

7. Tele shopping

8. Internet shopping

9. In-flight shopping

10. Mobile shopping

11. Paper/e-catalogue

1. Key individual

2. Buying responsibilities

3. Management responsibilities

4. Market forecasting & technology

5. Merchandise planning, selection & development

6. Working with resources – domestic/foreign

7. Pricing & promoting merchandise for sale

ROLE OF A BUYER

1. Key individual

ROLE OF A BUYER

Buyer – often called dept. manager/retail buyer

BUYING – DEFINITION – purchase of consumer

goods in relatively large or wholesale quantities for

subsequent resale in smaller retail lots to the

ultimate consumer.

Responsible for providing merchandise @ store

2. Buying responsibilities

ROLE OF A BUYER

a. Depends on organisational structure

b. Types of goods offered

c. Store sales turnover

d. Location of store branches/units


ROLE OF A BUYER

Why should a buyer have management capabilities?

a. He has to run the department

b. Be in constant contact with salespeople,

merchandising managers, staff, other store

buyer, customers

c. Attract consumer to store

d. Maximise profit


ROLE OF A BUYER

Buyer is an important link in management’s

communication network. (e.g. DMM communicates

store policies to buyer assistant buyer, sales staff,

vendors, manufacturers, customers)

Buyer should be alert to changes in personnel

attitudes and values, market & supply conditions,

consumer buying habits


ROLE OF A BUYER

Buyer should be aware of demographic,

psychographic marketing trends, economic forces,

technological advancements affecting consumer

attitude.

Should understand consumer behaviour and what

affects buying decisions in the market place


ROLE OF A BUYER

Should be aware of computer applications in

merchandising (EDP, POS, bar-coding, EDI, e-

Commerce, electronic shopping)

Importance and application of fashion information

to all categories of merchandise


ROLE OF A BUYER

a. Planning

b. Record keeping

c. Preparing merchandise budget

d. Assortment planning

e. Application of control system to merchandising


ROLE OF A BUYER

f. What to buy and how much

g. Product developer (scan domestic/foreign

market, meet tastes/needs of consumers, provide

exclusivity)

6. Working with resources – domestic/foreign

ROLE OF A BUYER

a. Must be aware of techniques used in making

buying contacts

b. Develop good vendor relations

c. Seek for resources

d. Know how to specify & buy from foreign sources

7. Pricing & promoting merchandise for sale

ROLE OF A BUYER

a. Determining wholesale price & retail price

b. Taking markdowns

Should be aware of psychological aspects of

advertising and

Determine advertising plan

Should know importance of ethics in advertising

ROLE OF A BUYER - SUMMARY

1. Formulating effective buying policies

2. Understanding retail consumer

3. Communicating effectively with market and trade

specialists

4. Continuously visiting local markets as well as

central trade markets


5. Keeping abreast of market trends, economic

conditions, competition, supply conditions,

methods of distribution

6. Developing an awareness of fashion trends &

their influence on fashion merchandise and other

categories

7. Planning for effective merchandise control


8. Planning & selecting merchandise assortment

9. Working with merchandise resources (vendors,

manufacturers, suppliers)

10. Pricing merchandise for a profit.

11. Employing good management techniques when

working with trade specialists as well as store

executives & personnel


12. Working as a liaison between

(a) parent store & branch store

(b) store manager & department manager

RESPONSIBILITIES OF ASSISTANT BUYER

1. Managerial function of the department

2. Paperwork related to inward/outward movement

of merchandise

3. Receiving, marking, stock-keeping activities,

invoice & order checking

4. Presentation of new merchandise for display, co-

ordinating promotion ads with the merchandiser,

department housekeeping

RESPONSIBILITIES OF ASSISTANT BUYER

5. Store communications, supervising salespeople,

knowledge of merchandise, trends & promotions,

establishment of good communications with

merchandising staff & management, maintaining

good telephonic contact.

CAREER AS A RETAIL BUYER

1. Buyer’s role is increasingly demanding – due to

changes in marketing environment

2. Buyer has to be imaginative & analytical to meet

the challenge & take advantage of the

opportunities it presents.

Environmental Forces Affecting Job Responsibilities of the Buyer

1. Market forecasting

2. Economic conditions

3. Environmental concerns

4. Technological advancements

5. Competition

6. Global retailing

7. Government regulations



May be broken down according to

(a) demographics

(b) psychographics



Demographics age, sex, ethnicity, income,

occupation

a. Population trends

b. The family household

c. Shifting of the population



Psychographics study of individuals personality,

values & roles, activities, interests, opinions


1. Market forecasting : Psychographics

Changing attitudes & values

a. Greater concern for health & better quality of life

b. Consumers are increasingly demanding in terms of

quality and performance

c. Weekend shopping longer shopping hours

during weekends


Changing roles of men & women

a. No. of working women – increasing

b. No. of two workers household – increasing

c. Increased spending on time saving devices

d. Catalogue for home shopping/electronic shopping

(T.V./Internet)

e. Fast food, convenience foods, prepared foods

1. Market forecasting : Psychographics


a. Recession high food prices high rate of inflation

cautious consumer

b. Boom (i) increased potential & increased

willingness to spend

(ii) buyer has to increase ad/promo to woo consumer

(iii) giving to consumers easy credit terms, coupons,

rebates, etc.



c. Presence of labour unions

d. Change in business conditions in vendor/supplier/

service provider firms (e.g. supplier may go out of

business, change the product line, raise price,

relocate, etc.)



a. Increased awareness regarding pollution/ecological

balance (organic cotton, non-polluting processes, eco-

textiles) (carry more functional brands)

b. Using energy efficient lighting

c. Relevant materials should be used in product design

d. products can be disassembled, repaired, recycled,

upgraded

3. Environmental concerns


a. Computer provides speedy, reliable and accurate

information which facilitates managerial decision

making

4. Technological advancements


a. Ever present

b. Characteristics of competitive environment

(i) diversifications & mergers

(ii) numerous types & sizes of retail stores

(iii) new merchandising techniques

5. Competition


Diversification allows retailers to expand their

purview

Mergers helps retailers to maximise the resources

thereby gaining a competitive advantage

5. Competition


Rapid growth of the Internet (non-store retailing)

a. Online commitment

b. Online selling

c. Traditional retailers need to realign customer

service, distribution & other operations so they

can capitalise on e-commerce in the future

5. Competition


New merchandising techniques

a. New strategies to revamp merchandise

b. Change of store image

c. Stocking major brands

d. New store designs

e. Stay open till late night

f. One stop concept

5. Competition


TODAY ……..

Manufacturers market worldwide

Retailers buy internationally

6. Global retailing


Retailing business is consumed by a power-play

among international giants.

LVMH acquired shares in GUCCI, PRADA, KRUG

CHAMPAGNE, BLISS, HARD CANDY, BOO.COM,

LIBERTYSURF, INTER PARFUM INC., TAG HEUER,

AUCHLAND, THOMAS PINK, JOSEPH, CHAUMET, EBEL

& ZENITH, SOLSTICE

6. Global retailing


Risks involved in global retailing

cultural differences,

currency differences,

different management styles,

Govt. regulations

6. Global retailing


Today, consumer’s demand of guarantees of

product quality, product safety, protection,

satisfaction in products purchased

Legislations governing retailer’s locations,

methods of distribution, timings, methods of

advertising



Laws have been passed to ensure competition and

fair business practices

For consumers laws protect them from unfair

trade practices & ensure safety


Documents

FBS Session I