Seasonal Merchandise Planning to focus on Customer Centricity and Inventory optimization

Seasons change and so does customer preference - what doesn’t change is your need for effective merchandise planning focusing on your customer needs. Keeping your inventory updated for all upcoming events is a deciding factor in successful business planning.

Your store needs to be like a well-organized home, where you know what you will find and exactly where. This will ensure that when you welcome guests to this home, they are neither lost nor confused and feel completely at ease. This planned layout drawn using Retail planning solutions like JDA Enterprise Planning, Allocation offers so that your guests/customers feel welcomed and at ease every time they choose you.

JDA Retail planning suite includes Merchandise Planning, Allocation and Category management to meet customer expectations and goals.

Why Innovative Merchandise Planning?

  • To put the right product in front of your customer at the right time and ensure sales increase.
  • Increase cross sale and up sale by right recommendations to consumers.
  • Increase customer wallet share.
  • Reduce churn by better understanding customer needs and planning to cater to them.
  • Optimize inventory throughout the year and be ready for meeting seasonal demands with suitable merchandise planning.
  • Make personalized offers and discounts based on customer profile and preferred products to drive sales.
  • Optimize pricing and cost management according to market to achieve better turnover.

Did you know?

With robust merchandise planning in place retailers can reduce inventory investment from 2 to 10 percent annually and free up cash. Improved localized merchandise planning enhances gross margin rates by 0.25 to 5% by analyzing demographics, customer behavior and store product attributes.

Let’s take a use case for Merchandise Planning:

Your customer, say Jennifer, whenever she walks into your store located in any part of Chicago or Washington should be able to pick up the merchandise that suits her needs at that point of time. So, let’s say that Christmas is just around the corner and you as a retailer need to predict which customers in your store areas would be looking for which Christmas merchandise and stack up your store shelves and inventory accordingly. So that when Jennifer passes by your store, she sees those awesome pre-Christmas offers on different merchandise. Keeping your inventory ready for the offer rollouts will ensure that your customers make the most of your promotions.

Customer centric seasonal merchandise planning:

Omni-channel inventory management:

Managing inventory across channels is the need of the hour. You need to be seamless in your offerings to your customers. With JDA Enterprise Planning and Allocation solution you can automate replenishment and keep track of product movement across inventories. Automating your inventory planning with demand planning and forecasting analytics will seamlessly merge your customers’ needs to your inventory. Introducing digital components such as RFID tags, inventory tracking by tab and mobile devices will help in keeping track of your inventory across different locations from a single device making replenishment easier and on time.

Be the only choice throughout the year:

So this way, you gradually become Jennifer’s only choice, throughout the year and regions. For this to happen, you need to focus on Jennifer completely while planning your merchandise throughout the year. If her demands for Peri Peri sauce increases in the winter then you should have your inventory optimized according to that, so that she never finds your shelves empty either online or offline. JDA Retail Planning suite which includes merchandise financial planning, allocation, and merchandise management system in a package can help you in keeping up with Jennifer’s ever-changing seasonal demands effectively by forecasting her purchases and helping you plan your inventory accordingly every season. While seasonally planning your inventory you need to take into account products which have almost steady demands throughout the year, like electronics, crockery, and basic household amenities. Balancing the inventory with both kinds of merchandises will ensure the right margin of turnover and revenue.

Handle massive demands with appropriate stocking:

As a retailer, you are always looking forward to the big sale days. Be it sales days like Black Friday, which is the biggest sale just before Christmas, Buy British Day, after thanksgiving sale like Cyber Monday or a summer sale like the July 4th sale. Be ready with appropriate stocks for your time and season with detailed merchandise planning for your store. Geography, season, demand forecast and buying pattern of customers determine merchandise planning for the season. Planning ahead for big sales will help in optimizing inventory across channels, taking into consideration the existing products, new trends and required stocks for the sale. Planning ahead will also help you chalk out a crowd luring window display with the best buys of the season. Inventory planning will enable you to avoid overstocking and at the same time be prepared for the huge sales of the season. For example, as the Black Friday sale is following the Thanksgiving Day and before Christmas, so you have to take into account that people will start Christmas shopping from this day onwards and plan merchandise accordingly with JDA merchandise planning. This will help to not overstock during Christmas with the same products.

Increase customer centricity with every sale:

And as Jennifer keeps purchasing from you time and again, you get the opportunity to know her more and align your inventory with her needs. Keeping the customer at the center gives you a fair view of when, how and how much each merchandise will move from the shelves giving you the space to plan ahead and optimize your inventory. For example with JDA Enterprise Planning you’ll know how much gingerbread Jennifer buys at different times of the year, 5 loafs in Christmas week, 2 in spring, none in summer etc. and stock up accordingly. Also, instead of stocking up your store shelves blindly, you can analyze and see Jennifer’s favorite channels of purchase and keep your inventory optimized for cross channel shopping. Focusing on customer instead of inventory will make sure your products don’t go waste and in turn save costs. It will also help you to devise better promotions and markdown plans like ‘buy a pack of gingerbread at your online store and get another free’, exclusively for customers like Jennifer.

In this digitally progressive, constantly challenging age of consumerism, customer centricity is your trump card. To play it well you need to add good inventory and merchandise planning to your retail suite. The idea is to present your business as a well-rounded product which works on automation and provides customers with their needs. Your business needs to be a well-oiled machinery which is always ready to cater to the customer when the button is pushed, with a great product offering wrapped in personalization. JDA Enterprise Planning helps you in getting the best out of a customer centric attitude with effective inventory planning, tracking and merchandise planning seasonally. Finding the right partner for the implementation of the enterprise solution is the key to driving success for your business. Aspire, a JDA Global Consulting partner, offers the right attention and ready capabilities for JDA Enterprise Planning, Allocation and Merchandise Management System solutions implementation for both medium and large organizations.

Author: Shreyasee Ghosh, Research Analyst

Practice Head: Chandra Rao, Retail Planning Solutions