Knowing your supplier is one of the best tools, weapons, instruments – no matter how you want to call it – to control the situation and always have the benefit in discussions, negotiations, day to day purchasing activity.

“Knowing” the supplier takes a lot of time and work at the beginning. It takes time to dig into the information, to learn all you can about their production capabilities, their partners (basically your competition), their competition; their reputation in the market and the reputation of their sales people and management; logistics and pricing, margin capabilities, service issues, quality issues, the company’s financial strengths and weaknesses, their product’s strengths, the marketing Read the rest of this entry »

This very interesting and (somehow) surprising AT Kearney Report suggests a new way to boost sales for low-volume items, applying a new way of thinking in assortment and replenishment. While in the situation when the items do no sell very well usually the reaction is to reduce assortment, the opposite approach – pushing the products into the stores in minimum quantities – has been shown to increase sales and reduce inventories without raising costs!

The approach suggested in this report implies a new way of assortment management, where people in the point of sales invest their energy in what they do best – merchandising and building costumer relationship – and the supply chain is managed in a pure centralized way.

In order to apply with success such a strategy the assortment and stock level of the point of sales has to be 100% managed by central Read the rest of this entry »

In my previous post I mentioned about Keith Cunningham’s seminar. The lessons below are taken from his training and applied explicitly to retail purchasing.

1. First and foremost: it’s not about the product – some purchasing professional have an obsession with the product they are buying (or category of products). They think that if they personally like it when the item gets into to market/shelf the marketplace/costumer will love it too and it will sell like crazy. They fall in love with the product and forget to get market data or to make market research for that product/ category to back up what they have in their gut. They believe themselves a focus group when in fact they are not a relevant illustration/sample of the market. The key point Cunningham made: a great product does not necessarily equal money. It’s never what you do; it’s how you do it that will determine your success. And how you do it is about management, in this case product/category management. Yes, it’s not about the product, it’s about the market demand and the whole marketing process you use to communicate that product to the costumer.

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The answer to this question is the key to my idea of doing business. It is my personal answer, of course and it is the result of my own journey in retail, which started in ‘97. I was working as a salesman to support my studies (which, by the way, had nothing to do with retail, au-contraire). Afterwards, I spent a short and disappointing (financially mostly) period as a young promising engineer, but got back to the retail world relatively soon and luckily this prove to be a permanent and fulfilling career.

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