Page 201 - DMGT554_RETAIL_BUYING

Retail Buying

Notes 12.5 Keywords

Buying Committees: Group of individuals who represent both wholesalers and the retail chains
that act as outlets for the wholesalers’ merchandise and who decide by committee upon products
to be carried (especially new products), store sales promotions, special offers, and other such
matters affecting retail sales in the stores or chains represented.
Group Dynamics: Group dynamics refers to a system of behaviours and psychological processes
occurring within a social group (intragroup dynamics), or between social groups (intergroup
dynamics).
Logistics: Logistics is the management of the flow of resources between the point of origin and
the point of destination in order to meet some requirements.

Markdowns: Planned reduction in the selling price of an item, usually to take effect either
within a certain number of days after seasonal merchandise is received or at a specific date.
Market share: The percentage of an industry or market’s total sales that is earned by a particular
company over a specified time period.
Markups: A percentage added to the cost to get the retail selling price.
Merchandising: Merchandising is any practice which contributes to the sale of products to a
retail consumer.
Planogram: A planogram is a detailed and thoroughly thought-through map that determines
where every product in an establishment should be situated.
Price Elasticity: Price elasticity of demand (also called elasticity) is a measure of the consumer’s
sensitivity to price.
Retailer: A business or person that sells goods to the consumer, as opposed to a wholesaler or
supplier, who normally sell their goods to another business.

Software: The programs and other operating information used by a computer.
Unitary Elasticity: In a situation of unitary elasticity, the percentage change in price equals the
percentage change in quantity demanded.

12.6 Review Questions

1. Define planograms.

2. Explain the merchandising with planograms
3. Discuss Market share placement – margin placement.
4. Highlight the evolution of planogram.
5. Write brief note on corporate design.
6. Explain logistics in merchandising.
7. What is buying committees?
8. Highlight the importance of group dynamics.
9. Describe the typical pricing decision flow chart.
10. “When assessing price elasticity of demand, one of three situations can occur.” Elucidate
those situations.
11. Describe the markups and mark downs in merchandise management.

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