The Role of Merchandising in Modern Day Retail

ible to the public. And this is where merchandising comes in.

Professionals in the merchandising trade – commonly referred to as merchandisers – are typically either employed directly by a brand, or work for a merchandising agency. The performance of a merchandiser is an absolutely key element in whether a product is successful or not. Yes, a business might have produced the most amazing product of its type, but if it’s not available in the right stores it’s not going to yield all that much success – in terms of profitability.

Therefore, a merchandiser will ensure that a brand’s products appear in the most appropriate stores at the right time. For example, a brand that produces garden tools might ensure that its latest hedge trimmer appears in DIY stores across the country, as part of its merchandising activity. It would be rather simplistic to assume that this is all a merchandiser does, however.

Merchandisers will work closely with the buying teams at retailers to ensure that stock levels are at an appropriate level. People in merchandising will also look at past sales figures for products of a similar type, current market trends, the costs involved in production and so on to determine an RRP (recommended retail price) for their product or products.

After a certain amount of time – often before the launch of a newer model – a brand will decide to lower the price in order to maximise sales and profits. The merchandising team is responsible for making these decisions. Upon the launch of a brand new product, demand will often reach incredibly high levels. Those within merchandising are responsible for ensuring that there are enough units to meet this demand. If demand outstrips supply, the end result is many frustrated and unhappy customers. And unhappy customers can be incredibly damaging to a brand’s public image.

The close monitoring of stock levels will continue for as long as product is on offer in the store.

Similarly a brand’s merchandising department will also ensure that its products are delivered to the right retailers on the right dates – maintaining communication with them along the way.

In stores where competition for space is tight, a retailer might decide to switch out one of its products that, for example, might not be performing as well as initially expected. The merchandising team will use forecasts, as well as existing sales figures to determine firstly whether this action is appropriate, secondly which products to switch out and the products to replace them with.

Merchandising departments will, in some instances, develop layout plans. These layout plans will provide suggestions for where specific product ranges should be displayed. However, the majority of stores will oversee this in-house.

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