Mkt312-Final-Set2

Front 1

assortmen plan

Back 1

list of merchandise that indicates in general terms what th e retailer wants to carry in a particular merchandise category

Front 2

category

Back 2

is an assortment of items that the customer sees as reasonable substitutes for each other

Front 3

category mgmt

Back 3

process of managing a retail business with the objective of maximizing the sales and profits of a category

Front 4

why use category mgmt

Back 4

-one person is responsible for the success or failure of a category
-using category mgmt is that it is easier to manage to maximize profits

Front 5

category catptain

Back 5

formas an alliznce w/ a retailer to help gain consumer insight, satisfy consumer needs, and improve the performance and profit potential across the entire category

Front 6

merchandise group

Back 6

managed by the senior vice presidents of merchandise

Front 7

classification

Back 7

gropu of items or SKUs for the same type of merchandise

Front 8

merchandise strategy

Back 8

1. define target market
2. establishign performance goals
3. deciding, on the basis of general trends in the marketplace, which merchandise classifications deserve more or less emphasis

Front 9

GMROI

Back 9

to ratios: inventory turnover and gross margin percentage; return on assets=net profit margin x asset turnover
-used as a return on investment profitability measure to evaluate departmnets, merchandise classifications, vendor lines, and items

Front 10

inventory turnover=

Back 10

net sales/ average inventory at retail

Front 11

advantages of high inventory turnover

Back 11

-increased sales volume (fresher merchandise)
-less risk of obsolescence and markdowns
-improved salesperson morale (no one likes to sell yesterday's stuff)
-more money for market opportunities (hold inventory until next season or selling it to retailers at a lower-than -normal price)
-decreased operating expenses
-increased asset turnover

Front 12

disadvantages of too high an inventory turnover

Back 12

-lowered sales volume, increased cost of goods sold, increase operating expenses,

Front 13

category life cycles

Back 13

sales start off low,increase, plateau, and than decline
-useful for predicting sales

Front 14

fad

Back 14

merchandise category that generates a lot of sales for a realtively short time-often less than a season

Front 15

fashion

Back 15

category of merchandise that typically lasts several seasons, and sales can vary dramatically from one season tot he next

Front 16

want book

Back 16

salespeopel record out-of-stock or requested merchandise

Front 17

depth interview

Back 17

an unstructured personal interview in whcih the interviewer uses eextensive problign to get indicidual respondents to talk in detailab tout a subject

Front 18

fill rate

Back 18

percentage of an order that is shppied by vendor ->high fill rate, means that in -0store merchandise availability increases, resulting in fewer out-of-stocks.

Front 19

variety /breadth

Back 19

number of different merchahandising categories within a tore or dept.

Front 20

assortment/depth

Back 20

number of SKUs within a category.

Front 21

product availability/level of support or service level

Back 21

defines the percentage of demand for a particular SKU that is satisfied.

Front 22

cycle stock/base stock

Back 22

inventory that results from the resplensishment process and is required to meet demand when the retailer can predict demand and replenishment times

Front 23

price bundling

Back 23

practice of offerint 2 or more different products or services at one pric

Front 24

multiple-unit pricing

Back 24

similar to price bundling except products or services are similar rather than different

Front 25

variable pricing

Back 25

application of price discrimination
-location/zone pricing
-early bird special
-senior discounts
-over weekend travel discount
-quantity discount

Front 26

leader pricing

Back 26

-certain items are priced lower than normalto increase customers traffic flow and /or boost sales of complementary products
-best items: purchased requrently, primarily by price-sensitive shoppers

Front 27

price lining

Back 27

limited number of predetermined price points
-benefits: elimiantes confusion of many prices
-merchandising task is simplified
-gives buyers flexibility
-can get customers to "trade up"

Front 28

odd pricing

Back 28

a price that ends in an odd number ($.57) or just under a round number.
-believe it increases sales
-implies the type of store or sale

Front 29

basic stock list

Back 29

desrbies each SKU and summarizes the inventory position

Front 30

deseasonlized demand

Back 30

forecast demand w/o the influence of sesonality

Front 31

order point

Back 31

amt. of inventory belowe which the quantyt available shouldn't go or the item will be out of stock before the next order arrives.
=(demand/day)*(lead time+review time)+Backup stock

Front 32

shrinkage

Back 32

inventory reduction that is caused by shoplifting by employees or customers, by merchandise being misplaced or damaged

Front 33

stock-to-sales ratio

Back 33

specifies the amount of inventory that should be on hand at the beginning of the month to support the sales forecast and maintain the inventory turnover objective

Front 34

core assortment

Back 34

relatively large proportion of the total assortment that is carried by each store in the chain, regradless of size.
-ncessary to maintain smaller store

Front 35

sell-through analysis

Back 35

comparios b/t actual and planned sales to determine whether early markdowns are required or whehter more merchandise is needed to satisfy demand

Front 36

everyday low prices

Back 36

-change the same price all the time
-set prices b/t reguarl non-sale price and deep discount sale prices of a high/low pricing competitior
-EDLP retailers typically still have some sales

Front 37

high/low pricing

Back 37

regular prices are higher than EDLP competitors, but merchandise frequently on sale at lower prices

Front 38

demand-oriented

Back 38

chrage as much as customers are willing to pay

Front 39

cost-oriented

Back 39

set price at a fixed percent over cost of merchandise

Front 40

competitior-oriented

Back 40

set price in relation to competitor's prices

Front 41

value

Back 41

relationship of what the customer gets (goods/services) to what he or she has to pay for it

Front 42

initial markup

Back 42

retail sellig price initially placed on the merchandise-cost of goods sold

Front 43

maintained markup

Back 43

actual sales that you get for the merchandise-cost of goods sold

Front 44

break even =

Back 44

fixed cost/ (unit price-variable cost)

Front 45

first-degree price discrimination

Back 45

charege customers as mucah as they woudl be willing to pay

Front 46

second -degree price discrimiation

Back 46

charging different prices to different peopel on the baises of the nautre of the offinerg (coupons, rebates, etc.)

Front 47

coupons

Back 47

offer a discount on the price of specific items when they're pruchased at a store->
-try for first time
-convert first timers to regular
-encourage large purchases
-increase usage,
-protec market share

Front 48

rebate

Back 48

portion of purchase price returned to the buyer
-more good for retailer b/c increase demand but retailer has no handling costs
-manufacutrer likes rebates b/c they let them offer price cuts to consumers directly.

Front 49

price bundling

Back 49

practice of offering two or more different products or services for sale at one price

Front 50

multiple-unit pricing

Back 50

similar to price bundlign in that the lower total merchandise price increase sales, but the products or services are similar rather htan different

Front 51

variable rpcign (zone pricing)

Back 51

charging diff. prices in different store, markets or zones

Front 52

price lining advantages

Back 52

-elimiante confusion
-easier for merchandisers-have price in mind
-buyers have more lexibility
-used to get customers to "trade up" to more expensive model