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Creating a Family Tree

Posted by on in Buying
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A Family Tree is a useful system used to capture important information for your business.

A Family Tree is a more detailed extension of the product classifications used in the range assortment plan.

The most useful aspect of this facility is to capture accurate information which will provide valuable historical data as well as a basis for planning your business.

Example of a Family Tree:

family tree

 

 

 

 

 

 

 

 

 

 

 How it works

Each item purchased would be given a code that registers with the appropriate description.  Therefore at the end of a period in the above example you would be able to determine how many Knitwear Key items in wool you have sold.

QUANTITY ALLOCATIONS

A lot of consideration has already gone into the selection of appropriate product for your business.  Setting the correct unit quantities to each item is now the key to the success of that item.  There are many methods and formulae that you can use to establish a quantity to be purchased however, before you start calculating this, you must consider the following:

  • size of the store (floor and reserve space)
  • store turnover
  • unit capacity of fixtures
  • weeks stock on hand (SOH) that you want to have available
  • type of product - fashion, basic, etc
  • life expectancy of the item
  • historical information
  • is it advertised or for a promotion
  • pre packed quantity restrictions

After reviewing the above points, you can now have a better idea on how to approach setting your quantities. Example (refer Figure 2.)

After setting the total quantity per item, it may be necessary to break it down further, e.g. size and colour.

Figure 2: Example of Unit Break Up

SIZE

COLOUR

SIZE

TOTAL

UNIT COST

UNIT RETAIL

KR240

L/S Jacket

Black (50%)

S (25%)

M (50%)

L (25%)

 250

 

500

 250

1000

$15.00

$35.00

 

White (20%)

S

M

L

100

200

100

400

$15.00

$35.00

 

Natural (15%)

S

M

L

  75

150

  75

300

$15.00

$35.00

 

Navy (15%)

S

M

L

  75

150

  75

300

$15.00

$35.00

KR 240

L/S Jacket

TOTAL

S

M

L

 500

 100

 500

2000

TOTAL COST

$30,000

TOTAL RETAIL

$70,000

Much better than guessing or using the "Oooh Aaaah I like it" method of buying.  Give it a try and see how you go!

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Shopping should be a pleasure for everyone involved - customers, staff and business owners - never a chore.  I spend my time working with retail business owners - helping them love their businesses back to life!  This blog is my thoughts, ideas, tips and  musings on what I find...

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