To address the increased focus we’ve seen in many retailers on improving their merchandising capabilities, particularly in assortment planning, Parker Avery’s President and Managing Partner, Clay Parnell provides his insights on how retailers can achieve assortment planning success.

(Excerpt from content originally published in RIS News.)

Assortment Planning Success

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Q: Why is assortment planning sometimes viewed as the “last frontier?”

Clay: There continues to be a certain mystery around assortment planning, and it often seems that when retailers discuss the topic, they are speaking different languages. There are certainly numerous definitions across the retail landscape of what it is and how it is used.

Assortment planning needs and the intensity of the activity are very different based on the number and type of sales outlets and the degree of fashion “newness” in the product line. These demonstrate one of the fundamental challenges with assortment planning: retailers strive to achieve a vast number of different goals with this capability. Given the variation in definition and process needs, it has been difficult for solution providers to develop a tool that fits what any one retailer needs.

Q: Why have some retailers been hesitant to adapt (or implement) assortment planning software and continue to do things manually?

Clay: Given the challenges noted, many retailers have continued to rely on either custom, proprietary systems, or more commonly, spreadsheets. Based on an assortment planning study Parker Avery conducted last year, over 70% of respondents use spreadsheets for some aspect of their assortment planning process. Other challenges have been lack of sufficient data, or lack of integration, to truly drive a robust assortment planning solution.

Another key challenge in focus and adoption success is organizational. Assortment planning straddles the traditional responsibilities of buying and planning organizations (albeit typically heavier on the buying side). Elements of assortment planning that are characteristic of one organization may not be recognized or valued by the other. Assortment planning requires merchant/planner collaboration because it truly blends the art and science of merchandising.

Q: How are the software planning tools available today better than those of only a few years ago?

Clay: Assortment planning software is really only recently reaching the level of sophistication and flexibility to truly support the breadth of retailers’ assortment planning needs. Without question many assortment planning solutions are making headway in development and adoption and are better able to satisfy the needs of retailers.

One key area of need and focus has been around integration. The real value of assortment planning is ensuring it is not a standalone process. Rather, assortment planning processes have touch points with merchandise financial planning (MFP), product lifecycle management (PLM), space planning, and even purchase order (PO) creation.

Q: How does assortment planning success differ when applied to apparel versus non-apparel categories?

Clay: In non-apparel people speak in terms of item planning/key item planning more than assortment planning. Also, in hardlines companies the space planning is done to a lower level of detail than is typically done for apparel. Non-apparel retailers tend to have more product on replenishment so there is naturally less item/assortment focus.

There is usually a higher degree of importance of attribute-based planning for apparel. Other categories are less dependent on attributes to plan and review different elements of the assortment architecture. While other categories may use “Good, Better, Best” for example, apparel may want fabrication, fashion content, silhouette, fit and other attributes available.

Clay Parnell, President & Managing Partner

Clay Parnell
President & Managing Partner

The Parker Avery Group is a leading retail and consumer goods consulting firm that specializes in transforming organizations and optimizing operational execution through the development of competitive strategies, business process design, deep analytics expertise, change management leadership, and implementation of solutions that enable key capabilities.

Published On: January 19, 2017Categories: Assortment, Clay Parnell, Planning