Merchandise Range Planning

What is Merchandise Range Planning?

Merchandise range planning is part of the overall assortment planning process and involves making decisions about the amount of merchandise choice - the variety (or breadth) and the depth – that will be available to customers. The breadth of stock is the number of different types of merchandise and the depth of merchandise is defined as the number of SKU’s per type.

Determining the right merchandise range is critical to meeting financial targets and satisfying customers. If the variety or amount of product aren’t what the customer needs or what the customer expects from the retail brand, the retailer will likely lose the sale and possibly the customer.

It’s a careful balancing act as overstocking merchandise will result in lower inventory turnover and reduced profits while understocking may result in lost sales and unhappy customers who take their business elsewhere.

In attempting to determine the ideal breadth and depth for a category, buyers should consider factors including:

  • Profitability of the merchandise mix
  • Corporate philosophy toward the assortment (broad and shallow or narrow and deep)
  • Physical characteristics of the stores or layout of the eCommerce site
  • Service level targets
  • Complementary merchandise

The ideal merchandise range plan results in the right merchandise, in the right quantity, at the right price and at the right time.

The Benefits of Merchandise Range Planning Software

merchandise range planning

Merchandise range planning software enables merchandisers and planners to build an assortment plan that will satisfy customers within the constraints of the financial plan and store space. Using sophisticated merchandising software helps them to find the most profitable mix of products.

Merchandise range planning software also moves planners beyond merely making ad hoc decisions based on previous comparative seasons. It marries science to the art of merchandise range planning by calculating choice productivity and considering fixture and store capacity/space. Once science has seeded the plan, the planners can apply their unique knowledge of their business, customers, market trends and competition to the plan before it is committed.

The benefits of using merchandise range planning include improved planner productivity, the right balance of assortment breadth and depth within the financial constraints and, if all goes as planned, financial targets are hit and customers are delighted.

Selecting the Best Software for Merchandise Range Planning

Possibly the most essential consideration when selecting the best software for merchandise range planning is the software’s integration with other departments. For example, buyers will demand that the range is innovative and attractive to potential customers, while merchandisers will want the plan to achieve a high level of sales and margin.

Merchandise range planning software should therefore be sufficiently versatile to allow buyers and merchandisers to formulate plans according to budget and space restrictions, measure the impact of adjustments to the original plan, and use the software to meet objectives defined during the financial planning process.

By being able to highlight specific issues such as potential stock outs or over stock situations, the best software for merchandise range planning will guide users to approve the acquisition of additional inventory so that the right level of stock is always in the right place at the right time to meet product demand from customers.

JustEnough’s Merchandise Range Planning Software

JustEnough is a market-leader in demand-driven solutions and understands that retailers face a huge challenge to satisfy today’s ever more unpredictable and demanding customers - who want and expect their favorite retailers to have exactly what they’re looking for in stock and also a wide selection to choose from.

This challenge is becoming ever more complex, with multiple shopping channels and customers armed with mobile devices allowing them access to more information than ever before; and consequently we have included the following features in our merchandise range planning software:

  • Range Framework: A range framework feature gives planners the opportunity to select the number of options they wish to include in their planning criteria to adjust the breadth and depth within the assortment
  • Localized Range Variations: The localized assortment feature adds versatility to the software in order to adjust results from the merchandise range planning software to account for localized variations.
  • Store Clustering: The store clustering feature groups stores together based on physical store attributes and past performances in order that plans can be more effectively aligned with the preferences of customers.
  • Review Range/Assortment Rollup: A review range and assortment rollup feature generates results relating to purchasing, sales, revenues and margins for each product in the assortment range.

Related Resources