For
Michael Kors • Established in 1981 • Luxury lifestyle empire • Stores are operated directly or through licensing partners • Dillard’s, Nordstrom’s, Macy’s etc.
• Philanthropy: fighting hunger for more than 20 years
Dillard’s • Founder: William Dillard • He developed a keen interest in retailing at a young age.
• The store began in 1938, in his wife’s hometown Nashville, Arkansas.
• His competitive strategy was to offer attractively priced national name brand merchandise along with customer credit.
• There are 300 stores spanning 29 states.
Target Market • Classy, trendy, sophisticated women who are between their 20’s and up. • “Wholly dedicated to a vision of style that is as sophisticated as it is indulgent, as iconic as it is modern” – Michael Kors
MK Handbags
Flat Cross-Body Bag $178
East/West Signature Tote $198
Hamilton Traveler CrossBody Bag $298
Selma Satchel $358
Large Hamilton North/South Tote $428
Stanthorpe Leopard Print Haircalf Large Convertible Satchel $598
Competitors: COACH
RHYDER 24 SATCHEL IN METALLIC LEATHER $350
GRAMERCY SATCHEL IN LEATHER $495
COACH TURNLOCK BOROUGH BAG IN PEBBLED LEATHER $550
MINI GRAMERCY SATCHEL IN CROC EMBOSSED LEATHER $595
RHYDER 33 SATCHEL IN SOFT GRAIN LEATHER $650
MINI GRAMERCY SATCHEL IN PRINTED HAIRCALF $795
Competitors: Vince Camuto
Riley Small CrossBody Bag $198
Leila Shoulder Bag $228
Robyn Small Satchel $278
Blake Python Print Satchel $288
Pilar Tote $328
Eli Satchel $358
Marketing Strategy
The Store
Michael Kors Flagship
Dillard’s Department Store
Open-to-Buy • Represents the dollar amount of merchandise the buyer may receive during the balance of a given period, without exceeding the planned stock figure. • Essentially the difference between how much inventory is needed and how much is actually available.
• It includes inventory on hand, in transit, and any outstanding orders. • The purpose of it is to limit over buying and under buying, prevents loss of sales due to unavailability of the required stock, maintains purchases within the budgeted limits, and reduces markdowns.
Why is a six month plan important? • It translates the profit objectives into a frame work of merchandise, planning, and control. • The main objective is to prepare a month by month purchasing schedule for the retail organization. • The plan includes open-to-buy, net sales, stock, reductions (employee discounts), purchases, shrinkage, markups, markdowns, and gross margin.
Planning Stock Turnover Rate • Merchandising figure that indicates the number of times that the average retail stock has been sold and replaced during a given period. • Goods turn into money and money turns back into goods. • The rate can be planned and controlled, it is usually expressed as an annual or semi-annual figure.
Planned Sales & Receipts • Sales is the basis for establishing the stock, markdown, and purchase figure. • This should always be calculated first for a six month plan.
• Receipts refer to the dollar amount of merchandise that can be brought into stock during a given period.
Planned Markdowns • Are important when it comes to dollar planning because they reduce the total value of the stock available for sale. • Helps reduce the amount of markdowns taken which helps increase net profits.
Six Month Buying Plan
Spring 2014
Month
August
September
October
November
December
January
Total
% OF SALES
12%
17%
16%
20%
24%
11%
100%
Sales
PLAN
$
222,000.00
$
314,500.00
$
296,000.00
$
370,000.00 $
444,000.00 $
203,500.00 $
1,850,000.00
BOM
PLAN
$
495,000.00
$
538,580.00
$
636,485.00
$
942,925.00 $
1,384,225.00 $
1,616,385.00 $
5,613,600.00
EOM
PLAN
$
538,580.00
$
636,485.00
$
942,925.00
$
1,384,225.00 $
1,616,385.00 $
1,769,395.00 $
6,887,995.00
Markdowns
PLAN
$
19,980.00
$
28,305.00
$
26,640.00
$
33,300.00 $
39,960.00 $
18,315.00 $
166,500.00
Emplyee Discount
PLAN
$
6,660.00
$
9,435.00
$
8,880.00
$
11,100.00 $
13,320.00 $
6,105.00 $
55,500.00
Workroom
PLAN
$
$
-
-
-
Shrink
PLAN
$
$
7,400.00 $
-
4,440.00
$
$
-
6,290.00
$
$
-
5,920.00
$
$
8,880.00 $
$
4,070.00 $
-
37,000.00
For
Workroom Costs
0%
Cash Discounts %
0%
Season Stock Turnover Average Stock
Purchases at Retail
PLAN
$
290,000.00
$
447,000.00
$
635,000.00
$
852,000.00 $
725,000.00 $
385,000.00 $
3,334,000.00
Purchases at Cost
PLAN
$
87,000.00
$
134,100.00
$
190,500.00
$
255,600.00 $
217,500.00 $
115,500.00 $
1,000,200.00
Markup $
PLAN
$
176,900.00
$
272,670.00
$
387,350.00
$
519,720.00 $
442,250.00 $
234,850.00 $
2,033,740.00
Markup %
PLAN
61%
61%
61%
61%
61%
61%
61%
Gross Margin
PLAN
46%
Turnover
PLAN
1.75
1.75 $
1,054,713.57
Markdown %
9%
Markup Goal
61%
Employee Discount
3%
Shrinkage
2%
Total Inventory
$
7,382,995.00
Average Stock
$
1,054,713.57
Assortment Plan OTB FOR THE MONTH OF September- (RETAIL) DESCRIPTION Hamilton Large Tote in Gooseberry, Black, etc Jules Large Drawstring Shoulder Bag in Navy, Cream Rhea Large Shoulder Bag in Caramel, Burgundy Selma Logo Large Top-Zip Satchel in Brown, Black Sutton Medium Satchel in Deep Pink, multiple colors Sloan Quilted Small Messenger in Black, Olive, Mustard Casey Sueded Snake Large Satchel in Elephant, Leopard Selma Houndstooth Mini Messenger in Black/White, Red
DELIVERY DATE
UNITS
15-Aug
160
$114.56 $
358.00
$
11,456.00
$
57,280.00
70%
15-Aug
200
$116.22 $
298.00
$
23,244.00
$
68,540.00
61%
15-Aug
50
$224.00 $
448.00
$
11,200.00
$
40,320.00
50%
15-Aug
100
$114.56 $
358.00
$
11,456.00
$
57,280.00
68%
15-Aug
180
$127.92 $
328.00
$
23,025.60
$
65,600.00
61%
15-Aug
200
$ 82.56 $
258.00
$
16,512.00
$
64,500.00
68%
15-Aug
25
$732.55 $ 1,495.00
$
18,313.75
$
37,375.00
51%
15-Aug
250
$ 73.32 $
$
18,330.00
$
56,400.00
61%
1335
COST
RETAIL
188.00
TOTAL COST
$ 133,537.35
TOTAL RETAIL
$ 447,295.00
TARGET MU%
61%
Assortment Plan OTB FOR THE MONTH OF January- (RETAIL) DESCRIPTION
DELIVERY DATE
UNITS
Hamilton Grommet-Trimmed Large Tote in Dark Red, Green
10-Dec
80
$183.20 $
458.00
$
14,656.00
$
36,640.00
60%
10-Dec
150
$116.22 $
298.00
$
17,433.00
$
59,600.00
61%
10-Dec
150
$ 93.96 $
348.00
$
14,094.00
$
59,508.00
73%
10-Dec
85
$155.22 $
398.00
$
13,193.70
$
55,720.00
61%
10-Dec 10-Dec
162 30
$ 86.94 $ $447.50 $
378.00 895.00
$ $
14,084.28 13,425.00
$ $
61,236.00 26,850.00
69% 50%
10-Dec
85
$119.40 $
398.00
$
13,193.70
$
55,720.00
70%
10-Dec
50
$293.02 $
598.00
$
14,651.00
$
29,900.00
51%
Elsie Crystal Box Clutch in Red Selma Medium SnakeEmbossed Top-Zip Satchel in Black, Brown, Caramel Camden Large Shoulder Tote in Pale Gold, Sliver, Black Frankie Large SnakeEmbossed Shoulder Bag in Dark Silver, Gold Jaryn Large Tote in Vanilla Susannah Qulited Large Tote in Black, Browns Lana Large Tote in Leopard/Black, Snake print
792
COST
RETAIL
TOTAL COST
$ 114,730.68
TOTAL RETAIL
$ 385,174.00
TARGET MU%
61%
Works Cited • http://www.michaelkors.com/ • http://www.pinterest.com/ • http://www.dillards.com/shop/Handbags /_/N-lfyu?cm_sp=handbags-_-header-_nav • https://www.google.com/imghp?hl=en&t ab=wi&ei=qTdmVPvBBoeyASPs4Ag&ved=0CAQQqi4oAg
“Be romantic, strong, and gorgeous. Walk fast and with energy, kill them with chic.� - Michael Kors