STORES Magazine - June 2011 - (Page 82)

NUTS AND BOLTS / PLANNING SOLUTIONS Cracking the Assortment Planning Code daVinci helps retailers spot store-level trends BY FRED MINNICK L eonardo da Vinci was one of history’s most intriguing figures. He painted “The Last Supper” and “Mona Lisa” and designed the eight-barreled machine gun and a flying machine. His mind was a rare combination of the scientific and artistic. Tapping into that science-meets-art philosophy is Atlanta-based assortment planning firm daVinci. Founded in 2004, it focuses solely on this particular aspect of supply chain management. President and COO Ning Chiu says her team saw a need in the marketplace for helping soft goods retailers spot national and local trends at the single-store level. In women’s fashion, for example, dresses were extremely hot in 2010, but overall sales are down this year. At some stores, however, dress sales remain constant. The daVinci solution can be used with any retail system, Chiu says, and helps retailers plan based on individual store trends. “They can look at the trend, but they’re going to have to ask, ‘Do I believe that this same trend is going to carry over?’” Same brand, different trends Chiu says the single largest investment that a retailer can make is in the inventory, but how retailers have determined this investment has changed dramatically. Twenty years ago, executives made buying decisions based on budget dollars available; 10 years ago, they looked to make everything more efficient. “We’re coming at it from a new perspective,” she says. “It’s our belief that unless you buy right to begin with, everything else is hindsight. Everything else is reactionary.” With that said, merchants also have to trust their gut. “They’re out at market, they 82 STORES / JUNE 2011 are spotting the trends, they are seeing what trends are taking off and those may not be what their numbers are telling them,” Chiu says. A retailer with two stores just five miles apart could have completely different customers, she says. “You could have a very small store that trends a whole lot faster than that large store. Even within the same store, it can be different. For example, that store could be in a tourist spot. Then your clientele all of a sudden changes in the summer because all of the tourists are flocking to it. “In the summer it could be what we call an ‘A’ store, which is a highestvolume store, but in the fall it could go down to an ‘E’ store, one of your lowestvolume stores,” she says. “How do you adjust to that?” That’s the question several retailers have asked before calling daVinci. The first thing retailers are looking to do is automate the entire process. Another problem with individual stores performing assortment planning is that a senior manager never sees the planning, Chiu says. daVinci helps senior managers gain visibility into purchase orders, allowing them to get involved in the planning for individual stores. “The idea is to have a consistent planning methodology,” Chiu says. “If WWW.

Table of Contents for the Digital Edition of STORES Magazine - June 2011

Stores - June 2011
Editor’s Page
President’s Page
Retail People
CEO Compensation
Customer Service
Business Strategy
What We’ve Learned
Loss Prevention Supplier Directory
Customer Rewards
Business Management
Social Media
Planning Solutions
Loyalty Programs
Business Intelligence
Store Operations
Divisional Update
NRF News
Point of View
Retail Industry Calendar
End Cap

STORES Magazine - June 2011