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Facs 135
Buying Lecture Midterm
42
Other
Undergraduate 4
10/23/2010

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Term
What are a buyer's duties and responsibilities?
Definition
1. follow market trends and economic conditions. 2. doing research and analyzing sales reports to better understand customers. 3. determining assortment of mdse. 4. selecting, contacting and working with vendors and sales reps. 5. negotiating terms/services. 6. working w/ mdse when it arrives. 7. pricing based on your profi plan. 8. maintaining balance(stockroom/floor). 9. promotion activities. 10. achieve quantitative goals for sales, markup and profit.
Term
What are an assistant buyer's duties and responsibilities?
Definition
1. prepare reports/keep records of sales figures,markdowns, and inventory.2. contact vendors about delivery. 3. supervise pricing, sales clerk training. 4. write purchase orders.
Term
What are a merchandise managers' duties and responsibilities?
Definition
1. planning. 2. directing. 3. coordinating. 4. controlling
Term
How do retail stores evaluate buying teams' performance?
Definition
1. net sales.2. maintained markup %. 3. markdown %. 4. gross margin %. 5. stock turnover
Term
What factors can affect the scope of a buyers' job? And how do they affect a buyer's job?
Definition
A.Mdse carried: basic and fashion . B. Organizational structure : centralized buying, other stores and specialty stores, and small independent stores c. Size of the retial organizations: small (buy all mdse for for all depts) and larger (more specialized, buy product categories)
Term
What are the characteristics of being a buyer for a small independent store?
Definition
in charge of not only buying, but also other operations. you buy all mdse for all departments. buyer is the owner. knows customers well so it makes buying easier. knowledgeable and enthusiastic about mdse which makes selling easier.
Term
What are the characteristics of being a buyer for a multi unit store?
Definition
1. dept stores may have branches. 2. buyer buys for the main store as well as the surrounding branches. 3. buyer may also need to manage the sales floor in main store.
Term
What are the characteristics for buying for a chain store?
Definition
1. 2 or more stores with single ownership. 2. buying from headquarters for all stores. 3. buyers concentrate on mdse planning.
Term
What are the 3 types of central buying strategies?
Definition
1. Central merchandising plan. 2. Warehouse requisition plan. 3. Price Agreement plan
Term
What are the internal sources?
Definition
A. store records. B. Management C. Salespeople.
Term
What are the external sources?
Definition
A.Customers and trade publications. B. Magazines. C. Vendors. D. Trades Associations:business organizations.E. Comcarison shoppers:watch out for your competitors F. Fashion forecasters
G. Reporting services ( independent org that watches and reports on trends). H. Resident buying offices
Term
What is RBO? What kind of services do they provide?
Definition
Resident Buying Offices. 1. RBO is marketing/research consulting firm that serves as advisor to group of memebers, client stores. Located in market centers, provide market info, mdse guidance etc.2. Services provides (similar to buyers)
Term
What are the different types of RBO?
Definition
a. independent offices. b. store owned-buying office
Term
What are the different types of store owned buying offices?
Definition
1. private office. 2. cooperative or associated office. 3. corporate buying office
Term
What is market segment?
Definition
smaller group of potential customers with similar needs or other characteristics.
Term
What are the 4 types of data used to segment a market?
Definition
1. demogaphics data 2. geographic data. 3. behavioristic data. 4. psychographic data
Term
What is product life cycle?
Definition
A. Introduction B. Growth C. Maturity D. Decline
Term
What product life cycle is important to buyer?
Definition
Growth
Term
What factors can affect the forecasting decisions?
Definition
a. past sales figures. b. promotions/sales. c. holidays. d. changes in store hrs. E. changes in amount of selling space. F. new competition moving into the area. G. selling days.
Term
Why is planned inventory level important?
Definition
A. be sufficient to meet customers demands. B. be small enough to ensure a reasonable return on the stores investment is inventory.
Term
What is stock turnover?
Definition
1. the stock turnover rate is the # of times the average stock is sold during a given period.
Term
what are the benefits of high stock turnover?
Definition
a. stimulates sales-fresh merchandise. b. reduce markdown. c. reduce inventory. d. lower expenses (interest, warehousing)
Term
What factors can affect stock turnover?
Definition
a. product type (women's clothing vs. men's clothing)b. price c. season d. promotion e. others (location, etc)
Term
what are the common causes of low stock turnover?
Definition
a. too wide assortment. b. wrong mdse. c. mdse too late. d. mdse priced too high. e. ineffective promotion
Term
What are some high stock turnover dangers?
Definition
a. losing sales due to stock out. b. failure to take advantage of quantity discount. c. placing too small orders thereby increasing transportation, handling and processing costs.
Term
what are the 6 components of the six-month merchandise planning?
Definition
1. plannes sales. 2. planned BOM inventory 3. planned EOM inventory . 4. planned reductions . 5. planned purchases at retail. 6. planned purchases at cost
Term
What is basic stock plan?
Definition
determine the amount of merchandise a retailer must have on hand or on order to have a sufficient amount of mdse available during period.
Term
What is rate of sales?
Definition
the units of the items that will be sold during the period, say a week.
Term
What is reorder period?
Definition
amount of time between orders for mdse
Term
what is delivery period?
Definition
time between placement of the order and time mdse is on the floor.
Term
what is reserve?
Definition
amount of mdse to meet unanticipated sales. it is additional mdse used by retailers to cover unanticipated sales to prevent customers from being lost to competition.
Term
what is maximum?
Definition
amount of mdse that must be on hand or an order at any reordering point.
Term
what is minimum?
Definition
point at which reorders should be placed.
Term
What is open-to -buy?
Definition
the amount the buyer has left to spend for a period, and it is reduced each time as purchas is made.
Term
What are the purposes of open to buy?
Definition
1. limit overbuying and underbuying. 2. prevent loss of sales. 3. maintain purchases within budgeted limits. 4. reduce markdowns. 5. improve stock turnover.
Term
How do you calculate open to buy?
Definition
PPR, PPC and Open to buy formulas
Term
What is assortment planning?
Definition
translating the planned purchases into assortments of prices, styles, brands, sizes, colors, and other factors, that will meet customers expectations
Term
why is assortment planning important?
Definition
buy and maintain a balanced assortment that meets the needs of the majority of your customers without having excess inventory.
Term
what is product line?
Definition
a broad category of products having similar characteristics and similar uses
Term
what is breath?
Definition
the #of product lines carried or the # of brands carried within a product classification
Term
what is depth?
Definition
the # of choices offered to customers within each brand or product classification
Term
What are the differences between a narrow and deep assortment plan and a broad and shallow assortment plan?
Definition
Narrow and deep: (e.g. old navy) one brand, but many assortments and options. Broad and shallow: (macy's) many brands, limited options and assortments
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