Model Stock Plan

A model stock plan is a written overview of the optimum assortment that will best satisfy the customer demand a store expects during a specific time period.
Some prelimInary steps must be taken to create this .plan:

1. Decide on the selection factors that will be used to buy the merchandise.
This litterally means identifying all of the general characteristics that a customer would look atto either purchase or reject it from the nonnegotiables like size and fit, to details like whether it has pockets.

2. Map out the important target dates in the season, when model stocks must be constructed and available, and the lead times to get them ordered so they'll be delivered when needed.

3. Calculate the sales figures for the months before and (from the previous l year) after thetarget dates, both in units sold and in dollars. Check the figures against the department's budget and classification plans.


With this information in hand, the buyer should be able to begin planning.The detailed model stock plan will include how many items to have on hand (listed by major classifications, not individual styles).
· The model stock plan is made first. Then, to implement themodel stock . plan requlres a buyJng plan, in which the buyer goes lnto greater detail. In, the buying plan, the buyer profiles the assortment, grouping the needs into subclassifications-sizes, styles, fabrics, colors-with amounts of each. The buying plan also details the timing of the orders. It includes an opening or initial purchase, in sufficlent quantities to keep the store stocked until the .reorder.

the· buyer can start by taking the model stock plan and the preliminary data that was gathered and doing the following:
· Adding any sales from the previous model to the current plan
· Subtracting any purchases the buyer has already made, or any stock that is I still on hand from the previous order

The result gives the buyer a realistic look at the current level of thismerchandise category in this department.. Let's say we're buying ladies' sweaters:

The model for November 1 in a certain price and type of sweater 100 units
Sales of this sweater during September and October +150 units
Sweaters ordered for the previous sales period (September 1) 250 units

Stock now on hand -120 units
Stock to be ordered (OTB) +130 units
in order to haveavailable same anount of sweaters 250 units


The picture can be filled in even further. A portion of the OTB to be ordered earliest would be scaled according to the size and calor factors determined by the buyer; and, if the current stock on hand is unbalanced in some way, the new order should make up for that. If the buyer would normally order about 40 percent black sweaters but the stockon-hand contains plenty of black sweaters, the new order would be modified. The other option is not to order everything at once, especially if shipping is prompt and another order could be filled on short notice.

I . Now the buyer shifts from units and selection factors, to actual dollars he or she is about to invest. Figure 5-4 shows one approach to the task1 again using sweaters as theproduct line. July and August are used as the lead time for a September buying plan. Cardigan sales for last year (LY) are used as a base for estimating this year's sales (TY). Note that the price lines ($30, $40, and $60) are an . important part of the plan, indicating the relationship between units and dollars. Columns 1 to 5 are the numbers of items; columns 6 to 8 are their dollar values.Selecting the breadth of styles that makes up the assortment is up to the '. buyer, within the policies set by the store. Some decide on basic percentages I and apply them to the color selections-buy three colors and split the order · into thirds, or buy 25 percent of the sweaters in black and split the other 75 percent of the order among the four most fashionable o'ptions (in the view of the buyer)...