Retail Dogma

Starting a Retail Business

This is a complete guide to starting a retail or e-commerce business

You will learn about:
Retail Basics
Buying & Merchandising
Retail KPIs
Retail Financials
Managing Performance

Retail Budgeting Process: Step by Step Outline

This is a step-by-step outline to the retail budgeting process

You will learn about:
Retail Budgeting Steps
Importance of Budgeting & Planning
Retail Budgeting Missteps
Mastering Retail Budgeting

Open to Buy (OTB) : The Complete Guide

This is a complete guide to the OTB (Open-to-Buy) concept in retail

You will learn about:
OTB Definition
Retail Buying Plan Template Components
Open to Buy Budgeting Steps
Importance of OTB
Retail Buying Plan Considerations

Everyday Low Price (EDLP)

Everyday low price is a pricing strategy, where the price is set at a low level from the start, eliminating the need or expectation for future discounts. This strategy is usually used by off price retailers, who pass the savings they achieve through product sourcing and cost savings to their customers, and thereby create an …

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Merchandiser Resume

We’ve analyzed many merchandiser jobs from different retailers, and came up with key points to include in a merchandiser resume. You can also download a sample in word format from below. Merchandiser Resume Focus The key focus for a merchandiser resume is “commerciality“. The main objective of this role is to deliver the financial goals …

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Highest Paying Retail Jobs

Retail as an industry is considered one of the biggest employers in the U.S. , and provides a good entry point for many people starting their careers, as well as temporary jobs between jobs for a lot of us. While the common reporting on retail jobs usually represents store-based roles, and hence reports low paying …

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Store Manager Interview Questions

Store manager interview questions attempt to test essential skills and knowledge in a candidate. Areas Tested Through Store Manager Interview Questions Specialized Knowledge & Business Acumen Leadership & Talent Management Problem Solving & Ownership Here, we are going to list some of the most common store manager interview questions and their target answers. Specialized Knowledge …

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Seasonality

Seasonality in retail refers to a predictable surge in sales during a specific time of the year, due to certain recurring event or “season”. Examples of Seasonality in Retail It should be noted that seasonality differs from one retail segment to the other and from one region to the other. That’s because it is tied …

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Product Mix

A product mix is the complete range of products offered by a business. It is also referred to as product assortment, and consists of all the product categories or product lines presented to the customer. Example A fashion boutique could have a product mix that consists of: Tops Bottoms Footwear Accessories Each of those lines …

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Quarter to Date (QTD)

Quarter to Date (QTD) is a term used in reporting, to express the period between the beginning of the quarter, up to the date of reporting. Example If the business follows a normal calendar year that starts on the 1st of January and wants to report financial results for the current quarter up to the …

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Retail Operations 101

Retail Operations is the function at the retail organization that handles opening and operating the retail stores, and delivering the customer experience to the end consumer through the physical retail outlets. Retail Operations Structure In the retail organization structure, operations is considered a core function, and involves the biggest team in the company. The operations …

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Retail Organization Structure

The retail organization structure lays out the different functions at a retail company and the flow of hierarchy from top to bottom. This defines the heads of each function and the teams that report to them. Retail organization structure is different at the head office from the retail stores, and in this article we will …

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Hard Goods and Soft Goods in Retail

Hard goods and soft goods, or hardlines and softlines, are often used in categorizing product departments in merchandising and category management at big retail stores and big online retailers, such as Walmart, Target and Amazon. Hardlines Vs. Softlines Hardlines and softlines are usually merchandised and sold to customers in different ways. They also differ in …

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Clearance Sale

Clearance sale is a markdown event that retailers use to clear the remaining merchandise at very low prices. Sometimes the price levels at this stage of markdown can be even below the cost price of the product. What is The Difference Between Sale & Clearance? Clearance is a type of sale event with a further …

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Independent Retailer

An independent retailer is someone who has started their own retail business independently, and not as part of a franchise chain. The Business Model of an Independent Retailer The independent retailer buys merchandise from manufacturers, wholesalers or distributors at wholesale prices, and then sells them through his store to the end consumer at higher retail …

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Retail Audit

Retail audit is the process of checking if the store is in compliance with the company’s standard operating procedures (SOPs). The retail store gets graded based on an audit checklist, and given a score (in percentage) that indicates its degree of compliance/non-compliance. Retail Audit Methodology Audit visits are usually done without pre-announcements (i.e surprise audits). …

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Pricing Power

Pricing power is the company’s ability to increase its prices, with little to no change on demand for its products. It is explained through the concept of price elasticity of demand, which measures the degree of demand reduction as a reaction to price increases. Pricing Power Example Let’s explain pricing power through two examples of …

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Anchor Store

An anchor store is a big retail store, often a department store or a supermarket, that drives traffic to the mall, due to its brand recognition and large customer base. They are often referred to as “anchor tenants” or “key tenants”, due to their major role in the success and appeal of the mall. The …

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Buying a Retail Business

Buying a retail business can be a great option for many people who don’t want to start a retail business from scratch. In this article, we are going to guide buyers on what to look for in a business that is offered for sale. Not only would we look for problems in the business to …

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Year to Date (YTD)

Year to date (YTD) is a term used in reporting, to express the period between the beginning of the year, up to the date of reporting. Example If the business follows a normal calendar year that starts on the 1st of January and wants to report financial results up to the end of April, the …

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Retail Recruitment Strategy

RETAIL RECRUITMENT STRATEGY The Ultimate Guide The changing retail landscape has urged retailers to search for a new retail recruitment strategy to be able to compete and attract the best talent. In this guide we will cover : Retail Recruitment Challenges Winning Retail Recruitment Strategy Case Study A NEW LANDSCAPE Work and employment has dramatically …

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Store Manager Resume Tips

In this article we are going to show, from a hiring manager’s perspective, what a store manager resume should include, so that the candidate has the best chance to stand out and get interviewed. What Should a Store Manager Resume Show? The key for a strong store manager resume is to show the candidate’s leadership …

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Store Layout

The store layout is the schematic design that shows the entire retail space and the locations of fixtures and display props around the store. It is meant to help the visual merchandiser plan the best way to utilize the available space for display, in order to deliver the highest sales per square foot, while maintaining …

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Clienteling

Clienteling has become an important technique in customer relationship management over the last few years, particularly at luxury retailers and high-end brands. It is used to improve the customer experience through personalization, enhance customer loyalty and drive repeated purchases and longevity of the customer’s lifetime with the brand. Read Also: Customer Lifetime Value What is …

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What is Luxury Retail?

Luxury retail is a segment in the retail industry that specializes in selling high-end goods that are characterized by high quality, high prices and a high degree of exclusivity. Read Also: What is a Luxury Brand? Over the last few years, the luxury retail industry has seen a tremendous growth, and in this article we …

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The Economics of Retail Expansion

Some of the biggest wealth creation stories have been, and continue to be, achieved through retail businesses. This is because retail trade is a scalable business by nature. It is not uncommon for even the smallest retail businesses to start expanding into two, three and four locations shortly after starting out and seeing how the …

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Retail Business Plan

A retail business plan is a document that gives you and your potential investors a roadmap on how your new retail business intends to get started and deliver its business goals over its initial few years (usually 5 years). It is usually broken down into sections about the company, the industry it operates in, the …

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Category Management: A Complete Guide

Category Management is a function at retail and ecommerce businesses, where related products are grouped together under separate categories, in order to manage their performance more efficiently. When a retail or ecommerce business grows to a level, where there are thousands of SKUs across many different product departments, the need arises for assigning a team …

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The Fashion Pyramid

The Fashion pyramid is a market segmentation pyramid that segregates fashion brands based on price, quality and creativity. The higher the segmentation level, the higher are those characteristics in this brand. The five levels of fashion segmentation are Haute Couture, Ready-to-Wear (RTW), Diffusion, Bridge and Mass Market. Haute Couture At the top of the fashion …

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Loss Leader Pricing Strategy

Loss leader pricing strategy is a marketing tactic used by retailers to sell one product at loss (the loss leader) in a hope that it will lead to more traffic and result in higher sales and profits overall. What is a Loss Leader? The loss leader is the product that is sold at loss. It …

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Upselling: Definition & Examples

Upselling is a sales technique used to increase the average transaction value by inviting customers to buy an upgraded version of the same product. Upselling and cross selling are sometimes used interchangeably, but in fact they are two different techniques and it is important to make the distinction. Cross Selling vs. Upselling The main difference …

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Cross Selling: Definition & Examples

Cross selling is a sales technique, where a related product is suggested to the customer to add to their original purchase. Businesses use cross selling to increase the transaction value for customers who are already converting and are in the final stages of completing the transaction. Cross Selling vs. Upselling The main difference between upselling …

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Bounce Rate for Ecommerce Stores

Bounce rate measures the percentage of visitors that arrive at a website and leave without clicking to any other pages. Since ecommerce websites are transactional in nature, with the primary goal to convert visitors from browsers to shoppers by completing a transaction, bounce rate becomes an important metric for online stores. What is a Good …

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Retail Math 101

Retail math refers to a set of formulas used by retail businesses in their day-to-day operations to calculate certain retail KPIs and metrics that measure the performance of the business. Importance for Managers & Owners It is very important for managers and store owners at any retail business to understand and practice using the different …

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Unplanned Purchases

Unplanned purchases are purchases made at a retail or ecommerce store that the customer didn’t plan for before entering the store. In order to understand why unplanned purchases happen, we first need to understand why & how people shop in the first place. The Customer Shopping Journey The typical customer shopping journey is planned in …

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Size Run

A size run is all the sizes a particular product is being manufactured in. For example, a fashion item could have a size run from S to XL; a footwear item could have a size run from 36 to 40, and a bra could have a size run from 34A to 42F. When you say …

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Visual Merchandising: Definition, Elements & Importance

Visual Merchandising (VM) is the art of using a retailer’s products and combining it with other visual elements (props, lighting, materials, artwork,..etc) to create an appealing visual display of the merchandise offered for sale. The main goal of visual merchandising is to maximize sales through creative display of merchandise. History of Visual Merchandising The concept …

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Broken Sizes in Fashion Retail

Broken sizes is a term used by fashion retailers to describe an assortment that does not have full size range anymore, due to the sell out of some sizes. When a retailer launches a line of clothing it initially launches in full size range. After a while of displaying it on the floor and selling …

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Inventory Allocation in Retail

Inventory allocation is the process of assigning specific products, in specific quantities to be delivered to store locations, where they will be displayed and sold. Inventory allocation is typically done by the merchandiser or the inventory controller, and is uploaded on the retail merchandising system to be seen and actioned by the warehouse team. When …

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Replenishment Systems in Retail

Replenishment systems in retail are systems that are set in place to ensure every product that gets sold at the store is restocked, so that the store does not get into an out-of-stock situation while the products are available at the warehouse. Note: We are not talking here about purchasing or retail buying. This process …

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Units Per Transaction (UPT)

Units per Transaction (UPT), aka Items per Customer (IPC), is a retail KPI used to measure how many items customers add to the shopping basket on average. It is used together with Average Transaction Value (ATV) & conversion to assess the effectiveness of the sales process and the sales team at the store. Units Per …

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Average Transaction Value (ATV)

Average Transaction Value (ATV), aka Average Order Value (AOV) in ecommerce, is a sales KPI used to measure the effectiveness of the sales process and the sales team in the store. The more skilled the sales team on the floor, the higher ATV they can deliver for the business. It is usually combined with other …

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Average Inventory

Average inventory is usually used during the calculations of different inventory metrics that are used to assess the efficiency of inventory management practices at a company. What is Average Inventory? Average Inventory is the average value of inventory that a company holds over a certain period of time. This period could be a month, a …

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Days Sales in Inventory

Days Sales in Inventory (DSI) measures how many days it takes to sell the company’s inventory. It is used together with other metrics like inventory turnover ratio and GMROI to track how efficiently a company manages its inventory. While a low DSI can be positive or negative; ie it could mean that either the company …

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Why Are Retail Stores Important?

Every quarter economists track how the retail industry is performing and take it into account while making decisions about the economy. This is because retail as an industry and retail stores play an important role in our lives, at many different levels, and not only as a channel for sales. With a rising amount of …

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How Retail Businesses Succeed?

I’ve worked at many retail brands during my retail career and worked as part of big groups with multiple brands under their umbrella. During all this time I have noticed brands that perform exceedingly well, and others that didn’t and eventually closed down. In this article I will list the common factors that make retail …

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What is Retail?

We all interact with retail businesses on a daily basis, and most of us probably know someone working in this sector. But for those of us who are interested to start a business in this sector, we might feel confused over where to start from or what establishing this business actually involves. So in this …

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Why Do Retail Stores Have Sales?

Retail & ecommerce managers sit every year during budgeting season and plan out their next year’s events calendar. In this calendar they plan their sales events, as well as other seasonal launchings or any promotional events for the year. So why do retail stores have sales in the first place? Retail & Ecommerce Stores Have …

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How Do Retail Stores Make Money?

Retail is a service industry, and retail stores make money by providing the service of making merchandise available for customers to buy conveniently. Retailers do not have to be manufacturing the goods themselves, although some retailers do design and sell their own private label merchandise. Read Also: What is Retail? The Business Model: How Retail …

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