From a “bottom up” view, catalog/multichannel marketers must consider every aspect of an item’s performance or life cycle to ensure every touchpoint to profitability is being considered properly. An item’s profitability is impacted by much more than simply demand and margin. I offer a top-down approach, which is extremely critical to the planning process. I also go to the opposite spectrum, however, and consider detail levels that often are overlooked when considering an item’s true profitability. If you hold your products to higher standards by factoring all their costs up front, you can gain greater profit to the bottom line. Let’s break down these
George Mollo
Merchandise analysis is an ongoing process. Although most companies should schedule formal reviews at the end of each season, the key to profitability is staying on top of the metrics that drive any multichannel business. Postmortems, as many of these reviews have been labeled, have a negative connotation in many marketers’ minds, and as a result, often are sidestepped. I’ve found that changing them to “preseason kick off” reviews promotes an offensive approach to profitability that can be maintained throughout the season. Of course, each business can apply its own weight to the measures to make final decisions. As multichannel merchants say, “It’s all about
Unfortunately very few people come to your door with a degree in inventory management. So what expertise is required when selecting or training an inventory manager/director? If you’re fortunate to find someone who has direct inventory management experience, that’s obviously a start. The key is finding or grooming someone who has the following attributes: • good common sense • both good analytical and business economic sense • strong social or interaction skills • someone who can “hold their own” under pressure and hopefully have a good sense of humor and self. You may be asking, why a good sense of humor and self? That’s because an inventory manager
We all recognize that inventory usually is one of our largest assets. Yet many of us don’t give it the importance or priority it deserves. Inventory management impacts almost every area of the company and can help contribute substantial hidden profits or losses depending on how it’s managed. The effect of poor inventory management often is hidden when business is good, and although quite evident when business is bad, businesses don’t have the resources at that point to address the issues. Unfortunately, this cycle is repeated far too often. Establishing a sound inventory management process within the ongoing company culture will cushion
Effectively planning your merchandise buys will have a dramatic impact on your customer service levels, fill rates and inventory management. Although there are many approaches to planning buys, I’ll offer an overview of the one I’ve used most successfully in my many years in the catalog industry. The process isn’t difficult, but it should be done with some consistency as you build your history from one timeline to the next. Although we frequently talk about the catalog industry being “item-driven,” to plan effectively, step back and look at your business from a broader categorical point of view. Start by defining the
