Beruflich Dokumente
Kultur Dokumente
RETAIL
MANAGEMENT:
A STRATEGIC
APPROACH,
9th Edition
BERMAN
EVANS
Chapter Objectives
To describe the major aspects of financial
merchandise planning and management
To explain the cost and retail methods of
accounting
To study the merchandise forecasting and
budgeting process
To examine alternative methods of inventory
unit control
To integrate dollar and unit merchandising
control concepts
16-2
Financial Merchandise
Management
A retailer specifies which products are
purchased, when products are purchased,
and how many products are purchased
* Dollar control involves planning and
monitoring a retailers financial
investment in merchandise over a
stated period
* Unit control relates to the quantities of
merchandise a retailer handles during a
stated period
16-3
Benefits of
Financial Merchandise Plans
The value and amount of inventory in each
department and/or store unit during a given
period are delineated
The amount of merchandise a buyer can
purchase during a given period is stipulated
The inventory investment in relation to
planned and actual revenues is studied
The retailers space requirements are partly
determined by estimating beginning-of-month
and end-of-month inventory levels
16-4
$417,460
$ 44,620
289,400
2,600
$336,620
90,500
$246,120
$171,340
Gross profit
Less operating expenses:
Salaries
Advertising
25,000
Rental
16,000
Other
26,000
16-5
$ 70,000
137,000
$ 34,340
Benefits of
Financial Merchandise Plans
A buyers performance is rated. Measures
may be used to set standards
Stock shortages are determined and
bookkeeping errors and pilferage are
uncovered
Slow-moving items are classified leading
to increased sales efforts or markdowns
A proper balance between inventory and
out-of-stock conditions is maintained
16-6
16-7
16-9
16-10
Disadvantages of Cost-Based
Inventory Systems
Requires that a cost be assigned to each
item in stock
Do not adjust inventory values to reflect
style changes, end-of-season markdowns,
or sudden surges of demand
16-11
Figure 16.1
Applying
FIFO and
LIFO
Inventory
Methods
16-12
Beginning-of-Month
Inventory
Net Monthly
Purchases
Monthly Sales
End-of-Month
Inventory
7/1/03
$90,500
$40,000
$ 62,400
$68,100
8/1/03
68,100
28,000
38,400
57,700
9/1/03
57,700
27,600
28,800
56,500
10/1/03
56,500
44,000
28,800
71,700
11/1/03
71,700
50,400
40,800
81,300
12/1/03
81,300
15,900
61,200
36,000
TOTAL
$205,900
$260,400
(as of 12/31/03)
16-13
16-14
16-15
Beginning Inventory
Net Purchases
At Cost
At Retail
$ 90,500
$139,200
205,900
340,526
Additional Markups
Transportation Charges
16-16
__
3,492
$299,892
16,400
__
$496,126
$496,126
Less deductions:
Sales
Markdowns
Employee discounts
Total deductions
16-17
$422,540
11,634
2,400
436,574
$ 59,552
16-18
$ 59,552
56,470
3,082
$ 56,470
$422,540
$299,892
sale
Adjusted ending inventory
34,136
$265,756
Gross profit
$156,784
25,000
Rental
16,000
Other
28,000
16-19
$ 70,000
139,000
$ 17,784
16-22
Actual Sales
2003 ($)
Projected Growth/
Decline (%)
Sales Forecast
2004 ($)
200,000
+10.0
220,000
128,000
+ 3.0
131,840
Hardware supplies
108,000
+8.0
116,640
Plumbing supplies
88,000
-4.0
84,480
Power tools
88,000
+6.0
93,280
68,000
+4.0
70,720
Housewares
48,000
-6.0
45,120
Electrical supplies
40,000
+4.0
41,600
Ladders
36,000
+6.0
38,160
Hand tools
36,000
+9.0
39,240
Total year
840,000
+4.9
881,080
16-23
Sales Index
January
46,800
67
February
40,864
58
March
48,000
69
April
65,600
94
May
112,196
160
June
103,800
148
July
104,560
149
August
62,800
90
September
46,904
67
October
46,800
67
November
66,884
96
December
94,792
135
16-24
840,000
70,000
100
Actual Sales
2003 ($)
January
46,800
67
February
40,864
58
March
48,000
69
April
6,600
94
May
112,196
160
June
103,800
148
July
104,560
149
August
62,800
90
September
46,904
67
October
46,800
67
November
66,884
96
December
94,792
135
Total Sales
840,000
16-25
70,000
881,080
73,423
Figure 16.3
A Checklist to
Reduce
Inventory
Shortages Due
to Clerical and
Handling Errors
16-26
16-27
16-28
Figure 16.6a
How Stockouts May Occur
16-29
Figure 16.6b
How Stockouts May Occur
16-30
16-31