The Ask.

Choose a department store retailer and go through the buying process of compiling a business report, a six month buying plan, an assortment plan, and a purchase order for Fall 2022. 

The Process.

Part 1: Choosing and Understanding the Retailer

For this project, we worked in teams of two, and we had to play the role of a buyer for a department store retailer. My partner and I chose to be the buyer for women’s apparel at Macy’s. One of the main reasons we chose Macy’s is because we needed a publicly traded company in order to have access to their financials when we were completing our buying plans. Also, my partner and I have been shopping at Macy’s since we were kids, so it was a company that we were personally familiar with. In that same vein, we decided on women’s apparel because I have become pretty familiar with all the brands at Macy’s after shopping there with my mom over the years. 

  • Competition

    After choosing our retailer, our next goal as buyers was to understand Macy’s’ competition. We identified Kohl’s to be Macy’s primary competitor. In order to holistically know our company, it was imperative that we understood the competitor’s business model, store policies, assortment, and competitive advantage. While Macy’s promises “to create a bright future with bold representation” and is a little more high end, Kohl’s emphasizes on the family experience and incredible savings.

  • Consumer

    If we are going to play the role of buyers, it is key that we understand who we are buying for, including their demographics and psychographics. 

    We found that the majority of Macy’s consumers ranged from 18 to 49 years old and consisted of working-class to high-class individuals with moderately to high disposable income. They tend to have predictable consumption patterns and are often loyal to brands they love. They live a very balanced life that is focused on family, faith, and community.

  • Market Trends

    At any given point in a retail cycle there are trends in the market, which impact the way business is conducted. A couple of trends we identified for Macy’s included collaborations and social media. 

  • Fashion Trends

    Fashion trends affect vendors, styles, colors, materials, and most of all, sales, therefore, it is crucial information that buyers need to monitor. Our goal was to identify trends regarding colors, textiles, prints and patterns, silhouettes and vendors.

Part 2: Six Month Buying Plan 

After understanding Macy’s as a company, it was time to get to the nitty gritty and create a six month buying plan. While keeping in mind the previous year’s sales, economic conditions, and market and fashion trends, we had to project sales for the Fall 2022 season. We estimated that Macy’s Inc Women’s Department sales are planned to increase by 3.8% for Fall 2022. One of the reasons for this increase is because of the large amount of expansion the company is implementing. Macy's was planning to expand beyond local malls by opening smaller format stores that Fall. These smaller format stores included two parts: Macy’s Market and Macy’s Backstage. They aimed to broaden their consumer market, by targeting off-price shoppers. Macy's was also expanding the products offered to consumers by allowing third-party retailers to sell on their site and by adding Toys-R-Us and Kylie Cosmetics to their wide range of company partnerships.

Part 3: Assortment Plan

Next, using the financial information calculated in the 6-month plan, we had to create an assortment plan including classifications, monthly sales by classification, vendor plan, purchases by classification, and a price lines plan.

We decided that the Fall 2022 assortment plan for Macy’s women’s department consisted of 50% tops, 20%. bottoms, 8% activewear, 11% outerwear, and 11% evening. 

The Outcome

Our final step was to create a brief slide deck that we would “present” to Macy’s divisional merchandise manager. This presentation would summarize our research on the company, six month buying plan, assortment plan, and our justification for the numbers. This project gave me a real glimpse into the kinds of decisions a buyer has to make on the day to day and the retail math skills you need in order to succeed. 

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