February 15, 2018

All Sorts of Merchandising Problems

The "Class Of" report is one of the most insightful, useful, and easy-to-create reports that exist.

And at Gliebers Dresses, we immediately identify a series of challenges.

Recall that new merchandise performed poorly in 2016 but performed better in 2017. The "class of" report illustrates several key issues.
  1. New merchandise in 2016 generated $29.8 million in annual demand, down two million from the year prior.
  2. In 2017, new merchandise generated $1.6 million more volume, but the business generated $1.0 million more volume. This means that existing items generated less volume.
  3. Look at the multi-year trend in demand from new merchandise. In 2014, $33.1 million came off of just 998 styles. In 2015, volume decreased by $1.3 million on 169 more styles. In 2016, Meredith responded by decreasing styles (why?) and then demand dropped by another $2.0 million. In just two years, $3.3 million was lost from new merchandise. This is a clear merchandising issue.
  4. Look at the year after an item was introduced ... in 2015, $11.7 million ... in 2016, $10.9 million ... in 2017, $6.3 million. The new items that performed poorly in 2016 performed horribly in 2017, costing Gliebers Dresses another $4.6 million in demand.
Meredith Thompson is not going to receive the news very well, is she?

Have you had a chance to run a comparable table? Do it!!

Business Principle #12