December 18, 2018

Merchandising Challenge vs. Recession

Let's pretend you have a traditional apparel business with five categories.
  • Mens
  • Womens
  • Co-Ed
  • Kids
  • Home
You run your comp segment analytics for November - December (your comps were about flat for September - October), and you see this:

  • Mens = -8%
  • Womens = -11%
  • Co-Ed = -9%
  • Kids = -7%
  • Home = -10%
This is the signature of a recession or a complete merchandising meltdown. More often than not, it's the signature of a recession. The percentages are all about the same, and all switched to negative at about the same time.

Here is the signature of a merchandising problem.
  • Mens = +4%
  • Womens = -11%
  • Co-Ed = -3%
  • Kids = -7%
  • Home = +5%
Notice that Mens and Home are positive. Notice that Co-Ed is an average of Mens/Womens. This is what a merchandising problem looks like ... your merchandising team messed up Womens/Kids and is hurting the business as a consequence.

Be darn sure to measure this stuff, and know if you have a recession on the horizon or if your merchandising team needs some assistance. And if you don't have the tools to do this work, check out the booklet below, available on Amazon.

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