Buying and Merchandising Team Decision Making

The setting

HAVERSHAM'S buys a large share of its outerwear from one overseas supplier whose deliveries have arrived well into the season two years running. The supplier is much cheaper than the alternatives and knows it.

Your role

You and your partner are to assume the roles of buyers at HAVERSHAM'S.

Your task

HAVERSHAM'S is a regional department store chain that buys much of its winter outerwear from one overseas supplier. The supplier's prices are well below those of the alternatives, and the quality has always been acceptable.

For the past two winters, however, the supplier's coats have arrived weeks into the season, after the first cold weather has already sent shoppers to competitors. Racks sat half empty in the busiest weeks, and much of the late stock later had to be discounted heavily. The supplier has promised the next shipment will be on time, as it did last year.

The director of buying (judge) wants you to recommend what HAVERSHAM'S does. Explain what the product management function has to weigh beyond price, explain how the product mix is affected when a category arrives late, describe how grades and standards bear on judging what an alternative supplier offers, explain how the company should maintain the supplier relationship through the conversation, and explain what late delivery does to store operations.

Performance indicators

• Explain the nature and scope of the product/service management function.
• Explain the concept of product mix.
• Describe the uses of grades and standards in marketing.
• Build and maintain relationships with customers.
• Explain the nature of operations.

The judge will ask

1. 1.What would you require of this supplier to keep the contract?
2. 2.How much more would you pay for delivery you can rely on?

The setting

A look has taken over social feeds and several competitors have already committed to it. BRACKEN & VALE has to place an order now for stock that will not arrive until well into next year, by which time the trend may be over.

Your role

You and your partner are to assume the roles of buyers at BRACKEN & VALE.

Your task

BRACKEN & VALE is a fashion retailer that places its orders months before stock arrives in stores. A particular colour and silhouette have suddenly appeared across social media, and three competitors have already announced collections built around them.

The buying team must place its order now for stock that will not arrive until well into next year. Some buyers are convinced the trend is the start of something lasting; others think it will have passed before the boxes are even unpacked.

The merchandise director (judge) wants you to recommend the order. Explain how you would identify the product opportunity here and whether it is real, explain the impact of product life cycles on the decision, explain how the wider product mix should absorb the risk, describe the marketing data you would want before committing, and identify the data you would monitor once the order is placed.

Performance indicators

• Identify product opportunities.
• Identify the impact of product life cycles on marketing decisions.
• Explain the concept of product mix.
• Describe the need for marketing data.
• Identify data monitored for marketing decision making.

The judge will ask

1. 1.How much of the order would you commit to the trend?
2. 2.What is your plan if it has passed by the time stock lands?

The setting

MARLOWE HOME wants to launch its own bedding range, made in the same factory as one of the national brands it stocks and sold alongside it at a lower price. The national brand does not yet know.

Your role

You and your partner are to assume the roles of buyers at MARLOWE HOME.

Your task

MARLOWE HOME sells bedding from several national brands, one of which is its best seller. MARLOWE has learned that the factory that makes that brand's sheets would also produce a similar range under MARLOWE's own label, and it could sell that range at a noticeably lower price on the shelf beside the national brand.

The national brand does not yet know about the conversation. Its sales representative has a close relationship with MARLOWE's buyers and has supported the store with promotions for years.

The vice president of merchandising (judge) wants you to recommend how MARLOWE proceeds. Explain the nature of corporate branding as it applies to a retailer selling its own label, describe the factors used to position that label against the national brands beside it, explain how the product mix should be arranged, explain the business ethics involved in the shared factory, and explain what the decision says about the retailer's brand promise.

Performance indicators

• Explain the nature of corporate branding.
• Describe factors used by businesses to position corporate brands.
• Explain the concept of product mix.
• Explain business ethics in product/service management.
• Identify company's brand promise.

The judge will ask

1. 1.What do you say to the national brand when they find out?
2. 2.Where would you place the private label on the shelf, and why?

The setting

ROWAN & FIELD carries a category that used to sell steadily and now does not. The buyers disagree about whether the category is finished, whether the range within it is wrong, or whether it has simply been put somewhere shoppers no longer go.

Your role

You and your partner are to assume the roles of buyers at ROWAN & FIELD.

Your task

ROWAN & FIELD is a department store whose home fragrance category, candles, diffusers and room sprays, used to sell steadily year round. Over the past year, sales in the category have dropped sharply while overall store traffic has stayed the same.

The buyers disagree about why. One believes the category is simply fading. Another believes the range has become outdated. A third points out that the category was moved last spring to a quieter corner of the store that many shoppers never walk through.

The buying director (judge) wants you to recommend what happens to the category. Explain the impact of product life cycles on the decision, explain how the product mix should change either way, explain how you would identify the product opportunities still in the category, explain what the product management function should be doing about it, and identify the data you would monitor before deciding.

Performance indicators

• Identify the impact of product life cycles on marketing decisions.
• Explain the concept of product mix.
• Identify product opportunities.
• Explain the nature and scope of the product/service management function.
• Identify data monitored for marketing decision making.

The judge will ask

1. 1.How would you tell a dying category from a badly merchandised one?
2. 2.What would you do first, and how long would you give it?