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Analyzing Business

Analyzing Business. Introductory Training Course for Store Managers. Agenda. Presentation and Group Discussion (30 mins .) Define variables that impact our business performance Review the resources available to you in division for these variables

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Analyzing Business

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  1. Analyzing Business Introductory Training Course for Store Managers

  2. Agenda • Presentation and Group Discussion (30 mins.) • Define variables that impact our business performance • Review the resources available to you in division for these variables • Discuss examples of these variables in our business • Activity: practice identifying variables (10 mins.) Analyzing Business

  3. Marketing • What is marketing? • Marketing is communicating a message to the customer • Activities include: advertising, promotions, in-store signage, and visual display • What resources are available? • Visual books provide examples of window displays and in-store signage • Talk to business partners, such as Visual and Merchandising to learn about marketing plans Analyzing Business

  4. Marketing Example • What message is conveyed to customers about styles that are featured in the store windows or on a front table? • What’s the impact to sales? Analyzing Business

  5. Competition • Where does competition come from? • Other companies (e.g. Target, Macy’s, J Crew) • Other company brands (Old Navy, Gap, Banana Republic, Outlet) • Other items within the store (e.g. knit dresses vs. woven dresses) • What resources are available? • Visit other companies and brands to understand product assortment, pricing strategies, and visual point of view. • Review other companies online sites to learn key messaging including new products, key trends and pricing changes. • Visit our own stores to learn what customers like/dislike, opportunities for improvement in product, pricing and store placement. Analyzing Business

  6. Competition Example What can we do to differentiate our brand’s style? Example: women’s rib tank top Analyzing Business

  7. Special Events • What are special events? • Special events include holidays, promotions, or Give & Get (Friends & Family). • Can account for increase in sales. • Watch for holidays that shift dates every year as this impacts customer traffic. • What resources are available? • Review information from Marketing, Company Planning, and other business partners. • Look at fiscal calendar and identify holidays that may have impacted sales. Analyzing Business

  8. Special Events Example Easter 2008 Easter 2009 • How long before Easter do customers typically shop? • What impact will the Easter date shift have on sales? Analyzing Business

  9. Fashion and Product Trends • What is fashion? • Defined in multiple ways, including: • Vision of the designer • Interpretation by the masses • Expression of the individual • All of the above • Mix of the past and the present • A fashion trend reflects the latest style • What resources are available? • Analyzing where different fashion and product trends are in their life cycle (emerging, peaking, or fading) can help you understand business performance. Analyzing Business

  10. Fashion and Product Trends Example What can we do when sales of knit dresses are starting to decline? Analyzing Business

  11. New Products & Store Concepts • What are new products and store concepts? • New products can range from a new wash for an existing denim program to a new category, such as sunglasses. • New store concepts typically are collections of product, for example “Red” at Gap. • What resources are available? • Information on new products and store concepts are communicated through business partners including Merchandising, Design and Visual. Analyzing Business

  12. New Products & Store Concepts Example Banana Republic’s Monogram Collection The Monogram product collection highlights the elegance and refined expression of the brand through quality fabrics and details. Analyzing Business

  13. Distribution • What is distribution? • Each brand has different store groups based on store capacity. • Store groups can range from all stores to only flagship stores. • Merchandising works with Visual to determine how many programs can be distributed to each store level. • What resources are available? • Assortment Costing Tool (ACT): store level information available. Report lists all styles and cc’s for a season and specifies store level distribution by cc. Analyzing Business

  14. Distribution Example Key driver programs are typically distributedto all stores since the larger store grouping provides the best opportunity to maximize sales. Analyzing Business

  15. Inventory Ownership • What is inventory ownership? • Weeks on hand (WOH) is a key metric to review to determine if a program had sufficient inventory to support sales. • Low WOH can indicate that sales were lost due to lack of inventory. • Best way to determine if WOH is high or low is to compare similar programs in the same department. • What resources are available? • Mid-Week Sales Trend, Week-Ending Sales Trend, Monday Morning Recaps and MARS Ad Hoc reports: all contain WOH information by program. Analyzing Business

  16. Inventory Ownership Example • Assuming all of these programs are comparable, what do you notice about the WOH data? • What does this suggest about inventory? Analyzing Business

  17. Product Flow • What is product flow? • New product assortments are delivered throughout the year to the stores in structured groupings called flows. • The timing of each flow is determined based on seasonality (i.e. climate), holidays (e.g. Thanksgiving), and customer traffic patterns. • Examining the affect of product flow may indicate opportunities to improve your business. • What resources are available? • Assortment costing tool (ACT): product flow information is available in ACT. Reports provide flow description, season code, in-store dates and number of weeks at regular price at the program and cc level. Analyzing Business

  18. Product Flow Example Pre-Fall Flow: September APS APS = 5 APS = 10 Long Sleeve T-shirt Short Sleeve T-shirt All short sleeve programs are beating plan and have an APS twice the rate of long sleeve programs. What does this indicate to you? Analyzing Business

  19. Price Point • What is price point? • Retail ticket prices are determined by Merchandising. • Factors considered when deciding on a retail price include historical analysis (sales performance and price relationships of past programs), pricing on similar product in competition, costing of the product and customer perception of the price versus value relationship. • What resources are available? • Assortment costing tool (ACT): price-point information is located in ACT at the program level. Analyzing Business

  20. Price Point Example Increase the retail price on similar programs that haven’t shipped yet from the factory… Units shipped = 60 Units sold = 56 Long Sleeve T-shirt Short Sleeve T-shirt $29.99 $34.99 Analyzing Business

  21. Any questions? Analyzing Business

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