Next week at this time, a team from Parker Avery will be enjoying the beautiful autumn weather in New York City, along with about 100 other retail industry experts and colleagues at Apparel Magazine’s much anticipated Apparel East 2015 conference. Coming on the heels of Revionics Insight 2015, where pricing, promotions, related strategies and implementation approaches were key concepts, we are excited to dig deep into another vital area of retail merchandising: Assortment Planning.
We are looking forward to the many opportunities to share ideas and experiences, as well as participate in the conference’s Ask the Experts Panel: “How Technology Will Help Us Win the Consumer” and our Technology Topics focused on clustering, advanced pricing, and Assortment Planning. Most notably, Parker Avery’s Clay Parnell is leading a discussion that focuses on the findings and insights from our latest research study, “Unraveling the Mysteries of Assortment Planning” (to be published early November 2015).
In determining our 2015 research agenda, we mulled over quite a few areas, including pricing strategies, store operations, product lifecycle management, retail branding and more. However, through countless discussions with our retail clients and colleagues, there lately seemed to be a common thread: the strong desire to better understand Assortment Planning, how it fits into the overall merchandising environment and how to successfully take advantage of these Assortment Planning capabilities as a strategic advantage.
We specifically invited merchandising and planning professionals to take part in the study, and we were delighted – although not entirely surprised – to find that this topic was of extreme interest to many retailers across all segments and sizes.
We thought we’d provide a brief a preview of some of the study highlights.
For a solid majority of the retailers in our study, the top two objectives included: developing different assortments by cluster and developing different assortments by channel, followed very closely by: quantifying sales at the style / color level. Next on the list of top objectives were: planning sales by product attribute (such as color, fabric or brand) and quantifying purchases or receipts at the style / color level. This wide range of high priority objectives demonstrates one of the fundamental challenges with Assortment Planning: retailers strive to achieve a vast number of different goals with this capability.
When it comes to Assortment Planning challenges, our retailers considered two issues to be standouts and almost equal in significance: inadequate software / tools and lack of integration. Related to both of these, we confirmed our hypothesis about pervasive use of spreadsheets in Assortment Planning.
What we didn’t expect was how very prevalent the use of spreadsheets actually is. Albeit, spreadsheets are sometimes coupled with another solution, this is still a higher proportion than we expected.
It seems that while most retailers are using a combination of tools, this mixture frequently does not involve a commercial software solution. The results when the panel was asked about tools used in clustering for Assortment Planning were similar.
Following closely on the heels of tools and integration, respondents named “resources and skillset” as the next most prevalent challenge, meaning the organizations simply do not have the people, bandwidth or expertise to effectively execute complex Assortment Planning activities. Other challenges include a lack of data and / or data integrity and leadership / management that does not visibly understand or support Assortment Planning capabilities.
So that’s just a glimpse into our Assortment Planning research study. We would again like to sincerely thank our panel of retailers who participated. The complete study is full of specific findings and Parker Avery’s interpretations and insights into what these findings mean for retail Assortment Planning in the near future. We are convinced that Assortment Planning holds tremendous value for retailers in tapping capabilities to more closely align offerings with consumer needs. To do it well, however, key prerequisites must be in place – these are explained throughout the study document. If you would like to receive a preview copy, please contact Tricia[dot]Gustin@ParkerAvery[dot]com.