AM 270 Week 5
Popular in Merchandising processes
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This 5 page Class Notes was uploaded by luke koppa on Friday February 19, 2016. The Class Notes belongs to AM 270 at Colorado State University taught by Ruoh-Nan Yan in Winter 2016. Since its upload, it has received 35 views. For similar materials see Merchandising processes in General at Colorado State University.
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Date Created: 02/19/16
Chapter 9 Developing Product Lines Line Development o Determine the actual styles, sizes, and colors that will fill out the line plan o Difference between line planning and line development? Line Planning guides variety/assortment of the line Line Development identifies specific merchandise Primary Forms/Approaches of Line Development o Purchase of Finished Goods Finished Goods= merchandise ready for sue by the ultimate consumer Who is Involved? Retail merchandisers o Traditional form of retail line development o Ex: Old Town boutiques that only sell items manufactured by other brands Manufacturer merchandisers o To complete the product offerings rd o Ex: Levi’s selling 3 party accessories Where to Go? Market: place where buyers and sellers meet to transact business o Primary Market: Atlanta (AmericasMart) Known for gifts/souvenirs Chicago (Merchandise Mart) Dallas (Market Center) Western wear specialization Los Angeles (L.A. Mart) New York (Merchandise Mart) Offer both Permanent and Temporary Showrooms Region Served: Nationwide o Secondary Markets Denver Still fairly large Seattle Boston Difference from primary: smaller size and region it serves Region Served: Regional o Trade Shows Temporary exhibits in a convention center, merchandise mart, or hotel at which manufacturers present goods to retail buyers Off Price Specialist Show (NY & Vegas, 2x a year) Lower end quality or leftover runs Random/varied assortment but inexpensive MAGIC/Project/Pool (Vegas, 2x a year) Show men’s, women’s, kids apparel MAGIC general Project Higher end, international Pool new designers, new lines ENK International (Vegas & NY, 2x a year) High end, exclusive feel WWIN (Vegas 2 x a year) Women’s Wear in Nevada Lower price point for women Not as trendy Liberty Fairs (Vegas 2x a year) CurvExpo Lingerie and Swim SIA (Denver) Snow Sports Industries America Skiing, snowboarding Apparel and hardgoods Outdoor Retailer (Salt Lake City 2x a year) Outdoor industry companies Apparel and hardgoods Others Market Vs. Trade Shows o Permanent Market showrooms typically offer Better Ambiance with privacy Complete range of merchandise Image of the company o Trade Shows/Temporary Showrooms typically offer Little privacy and ambiance Some exceptions for larger/more exclusive brands Select merchandise May have swatch samples/ catalogues of colors that cannot be displayed More current trends May offer presentations about buying, trends, media, etc… What to do @ Markets/Trade Shows For retailers o View, evaluate, and/or purchase products For Manufacturers/Vendors o To sell merchandise (primary goal) o View competitors lines (price, colors, styles) o Service current customers o Identify new prospective buyers o Introduce/test new or modified products Test buyers reaction before releasing What to Purchase? Branded Merchandise o Identified by a name and/or symbol o Well known Private Labels Licensing o Definition: Contract between the owner (licensor) of a merchandising property and a company who wants to use the property (licensee) for an agreed period of time, within an agreed territory Breach of agreement results in penalties o Use of a merchandising property in the design of a product or a product line o Examples: CocaCola, sports teams logos, cartoon characters Mossimo and Target Mossimo designs products Target product development, sourcing, production Simply Vera, Princess Vera Wang by Vera Wang @ Kohls Vera Wang designs and produces Kohls distributes Jason Wu and Target Jason Wu designed and produced Target distribution o Deciding which merchandising property to choose for products? Target market Product category Royalty fee (1%15%) Fee charged for rights to use More wellknown brands have higher royalty fees Agreements regarding design, production, and distribution o Licensing Expo in Las Vegas o Internal Product Development Definition: design and engineering of products to be producible, salable, and profitable Time Frame: moved from 56 weeks (1980s) to 12 weeks currently Zara 4 weeks 3 Phases of Internal Product Development Creative Design (Preadoption) o Purpose Research/market analysis Creativity Formation of product lines Cost estimates o Get samples of Designs Critique and revise Get new revised prototypes Line Adoption o Purpose To determine which designs should be included and go forward into technical design May also adjust/revise certain designs before adopting them into the line To decide the styles for which sales and catalog samples will be made o Designs: about 1/3 of styles will be adopted Technical Design (postadoption) o Purpose Perfect styling and fit of chosen styles Perfect production patterns Used in massproduction Ensure quality and performance of materials Develop detailed specifications Develop detailed costs Used later to finalize wholesale/retail price Traditional Process of product development for Manufacturers Sales samples ready for line release at wholesale markets o Line preview show prototypes to sales team internal o Line release show samples to buyers (@ markets) External o Used for promotional purpose and selling purpose o Combination of Both Ex: Nordstrom & other department stores
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