Training, Teaching and Learning Materials (TTLM)

The Ethiopian Revised TVET-System

MARKETING AND SALES MANAGEMENT
Level - II
Learning Guide#06
Unit of Competence: MERCHANDISE PRODUCTS
Module Title: MERCHANDISING PRODUCTS
Module Code: LSA MSM2 06 0822

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MERCHANDISE PRODUCTS
LO1. Placing and arranging merchandise

1.1 Unpacking merchandise

1.2 Placing e-merchandise

1.3 Displaying merchandise

1.4 identifying damage and out-of-date stock

1.5 Placing Stock range

1.6 Rotating stock.

1.7 Ensuring stock presentation

LO2. Preparing and applying labels and tickets

2.1 Preparing labels and tickets

2.2 Using electronic tickets equipment

2.3 Identifying incorrect labels and tickets

2.4 Maintaining labels and tickets

2.5 Placing labels and tickets

2.6 Replacing labels and tickets

LO3. Maintaining displays

3.1. Displaying unsuitable and out-of-date

3.2 Assisting supervisor display

3.3 Arranging and facing up merchandise

3.4 Maintaining correct pricing information

3.5 Identifying and replenishing stock levels

3.6 Removing excess packaging

LO4. Protecting merchandise

4.1. Identifying and applying correct handling storage

4.2. Applying displaying techniques

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LEARNING OUTCOMES (Objectives)

At the end of the learning guide, the trainee must be able to:
 Place and arrange merchandise
 Prepare and apply labels and tickets
 Maintain displays
 Protect merchandise

INTRODUCTION
This learning guide is prepared for MARKETINE AND SALES MANAGEMENTLevel II
onMERCHANDISE PRODUCTSby identifying target customers to generate adequate profit.

Indeed, the purpose of this learning guide is to serve only as a launching pad for the discussions
of Merchandise Products; and it is incumbent upon the instructor to further elaborate and add
contents of relevance to the material with the general objectives in mind.

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INTRODUCTION
The merchandise word has been coined from the old French word, ‘merchant’ which means
goods. Merchandising means the buying and selling of goods with a motive to earn profit. The
Oxford Advanced Learner’s Dictionary defines the word ‘merchandise’ as goods bought and
sold or trade goods. According to Business Dictionary, ‘merchandise’ refers to goods and
commodities sold at the retail level. Merchandising focuses on the buying, presenting, and
selling of merchandise. According to American Marketing Association, merchandising is the
planning involved in marketing the right merchandise at the right place at the right time in
the right quantities at the right price. To this definition, we can further add “marketing to the
right target customers.” This addition may give completeness to the merchandising process.
‘Merchandising is not a synonym for the buying function, it is an integrated, end-to-end business
process that runs from planning the assortment, to sourcing, to distribution, to allocation of the
goods to the stores, to promoting and selling the assortment to the customers and finally to
replenishing inventory as necessary.
In fact, Merchandising is the art of marketing the right merchandise at the right place at
the right time in the right quantity at the right price. The success of the merchandising lies in
these five ‘Rights’.
PROCESS OF MERCHANDISING
a. Understanding consumer needs
The merchandiser should understand the different ways in which the consumer presently satisfies
the need. Let us assume that the consumer has need for hair care. Based on the study the
merchandiser may find that there are various ways in which the need is being satisfied. These
may be hair soap, oil, lotion, shampoo, cream and dye. With the help of consumer survey the
method/ product which is most in demand for satisfying the need is ‘shampoo’.
b. Identifying and sourcing of right merchandise
Further, the merchandiser may need to identify the right merchandise for shampoo.. For
example, in shampoo the merchandiser may find that there are three variants – herbal, medicinal,
and regular. The merchandiser based on the study of consumer feedback would like to know,
which one is most in demand, or will help the retailer to serve the consumer needs. Suppose the
merchandiser decides for ‘medicinal shampoo’. For medicinal shampoo, the merchandiser needs
to identify the right suppliers/sources of this type of shampoo. He /she may like to analyse the
brands like Vatika, Sunsilk, Pantene, Head & Shoulder, and Palmolive which can supply the
medicinal shampoo.
c. Planning the right assortment
Next the merchandiser has to decide on the different sub-categorization. The sub-categorization
can be made, based on the consumer need for medicinal shampoo. The shampoo may be used to
treat different kinds of hair condition i.e. dull, oily, dry, normal, straight, and curly. Thus, the
merchandiser must know based on past trend, experience or survey, the right quantities to be
maintained under each sub-categorization.In other words, the assortment should cover needs of
different hair conditions.
d. Planning distribution to different locations
Once the assortment is cleared then the merchandiser needs to work out the quantities to be
dispatched to different distribution centres. The quantity dispatched should be based on the
number of outlets in each location, the minimum stocks to be maintained, turnover ratio, the
replenishment time, etc. The logistics for delivery of goods should also be taken into account.
e. Providing right quantities

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Once the goods reach the different distribution points, the goods further needs to be sent to each
of the outlets in the region. For this the retailer will take into account the consumer requirement
in each of the stores based on previous sales trends or its own study of consumer needs. Thus, for
each store its requirement in terms of different assortment is worked out and the goods are
dispatched.
f. Deciding the price
Once the goods reach the store, the merchandiser needs to decide on the pricing of each of the
products/items. Normally, the pricing is decided at the time of assortment stage itself. In case of
certain retail chains the pricing may be left to the respective store managers also, the manager
will work upon prices as per the guidelines from the chief merchandiser for the product category.
The prices are decided based on the gross margin policy for each of the products.
g. Communicating offerings to target consumers
Once, the goods are on the floor of the shop, the merchandiser will work out the visual
merchandising. He/she will communicate such strategy for the given store or group of stores.
The merchandiser may provide certain props and signages to each of the store to communication
right messages and offerings to consumers. There could be advertisements in print media or TV
or radio or hoardings etc., for giving mass publicity to the offerings.
h. Taking/understanding feedback of consumers
The merchandising team may decide to take feedback on different brands/items to know
consumers reaction to pricing, quality, availability, display, after use effect etc. The feedback
acts as a guideline for improving sourcing and assortment, so as to provide maximum
satisfaction to consumers.
Objectives, Strategies and Principles of merchandising
Merchandising has two broad objectives:
o Buy and store the products that are needed by the customers.
o Second important objective of merchandising is the growth of the business and making the
business profitable. It means store or buy that products which are in demand and can be
sold.
Principles of merchandising
Merchandising is delivering the right product at right place and right time to the targeted
customer. For successful merchandising operations there are some principles which have been
mentioned as follows:
o Offer what customer wants
Retailer should store and offer in his store what the customer wants.Products must be available
for each class of customer and for each age group like ladies, men and kids.
o Prepare merchandising plan
A successful merchandiser has a merchandising plan. Planning should be based on demands and
specialty of each store and department. It should be based on previous records of selling of the
products. Changing fashion trend and consumption habits of the customers must be kept in mind
before making a merchandising plan.
o Selection of sources of supply
Merchandiser has to select vendors and suppliers who meet his requirements in terms of price,
quality, reliability and delivery. He has to search the list of suppliers available locally or at
regional /national level and select the supplier accordingly.
o Consistency and change

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There should be consistency in merchandise assortment. Regular customers are very

particular in lifestyle, products, price etc. So retailers should capable of offering regularly as
to what his customer’s wants. Along with this he has to introduce an element of novelty in
order to meet the changing trend and demand of the
customers.
o Present right assortment
Retailers have to present right assortments of merchandise, i.e., types of product, brand, price,
range and other features that the regular customers expect.
o CRM
Sale to a customer is not a single day business. So develop a goodrelationship with the customer
by providing them good services.
o Customer delight
Retailers should ensure customers delight through new products, offers, discounts, installment,
returns, gifts and other facility something that is unique, which may please and delight a
customer.
Types of merchandising
a. Product merchandising
It involves all promotional activities used to sell a product .It includes in –store as well as online
products both.
b. Retail merchandising
It refers to all promotional and marketing activities that in some way contribute to selling
products to customer in a physical retail store.
c. Visual merchandising
It refers to all of the display techniques used to highlight the appearance and benefits of the
products and services being sold. It may include elements of spacing, lighting, design etc.
d. Digital merchandising
It involves all promotional activities used to sell products online. Often referred to as e
commerce or online merchandising
e. Omni channel merchandising
It refers to creating a unified customer experience across all possible touchpoints of the customer
journey. In Omni channel merchandising the customer moves from a search engine, to on -site to
their email and then back to on-site.
Merchandising strategies
o Window and in-store display
o Grouping related products together
o Shelf signage
o In –store ads featuring the merchandise
o Samples and giveaways
o In –store demonstrations
o Well stocked shelves
o Spotlighting promotional items
Benefits of merchandising
o Higher sales
o Faster inventory turnover
o More satisfied customers
o Increased customer loyalty

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MERCHANDISE PLANNING
Once we have set our objectives the stage is set for planning it-out. Significance of planning here
is worth discussing. Whenever you plan for merchandise it is based mainly on the sales
projections or forecasts as we call it in common parlance. These forecasts carry projections for
the overall company, product category, item wise and in case it is a retail chain then individual
store wise projections. While merchandise planning we have to keep in mind the following
considerations
 Types of Merchandise
Essentially merchandising is of two types: staple/basic merchandise comprises of daily need
products as well as those commodities which the customers buy frequently throughout the year.
Fashion merchandise comprises of luxury items as well as products, related to fashion, style, and
status. Depending upon the type of merchandise the planning may differ. A retailer selling staple
merchandise will have lesser maneuverability regarding charging of premium brand of fashion
merchandise retailer. However, of fashion merchandise retailer will have a greater risk of
changing fashions than the staple merchandise retailer who will not have such risks at all.
 Merchandising Objectives
We have discussed about merchandising objectives earlier. It is most essential that we look into
the fashion trends and the category and unit forecasts before planning out our merchandise.
 Category/Unit Forecasts
Forecasts put logic behind acquiring a particular assortment of goods as well as quantity to be
ordered. It is worth mentioning here that authenticity of the forecasting procedure makes it
dependable.
 Budget
Every retailer would like to keep the correct quantity of merchandise in the correct place at the
most suitable time/month/season. Moreover he would like to achieve this within the limited
budget of his store.
 Timing
In merchandise planning timing and the strategic considerations are the key determinants. We
should always keep in mind the importance of time in merchandising. Procuring grains by a big
grocery shop can become very strategic proposition if proper time is kept in mind. This can be
the harvest period. Similarly what is the strategy? This question decides the merchandising plan.
 Strategic Considerations
Each store starts its plan with setting its financial objectives. Once they are set the next stage is
to decide what to purchase for sale in the store. Here the retailer is cautious about his financial as
well as space limitations. Thus with his ground reality clearly known he now has many
merchandise related decisions to take -- For example if the store is a men's clothing store, then
the retailer has to decide whether to carry a large variety of different types of clothing technically
known as categories like shirts, trousers, jeans, t-shirts, suits, jackets or maintain fewer
categories but a larger assortment of more styles and colors within each category. The decision
problem does not end here. A retailer has to now decide as to how much stock to carry in each
unit, each category and so on. However from a business perspective it is very important to note
that more the retailer invests in back up stocks the less he would be able to invest in variety or
say deeper assortments. A retailer on the basis of his experience and market forecasts makes a
tradeoff between variety, assortment and back up stock. This is known is assortment planning.
 Strategic Assortment Planning

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Each retail store is looking forward to have the best return on investment. For having the best
returns it is essential that the store is able to stock what the customer needs especially what is the
size requirements, and other preferences like color, shade, design fragrance etc. for example if
you go to buy a shirt in a retail store you will have specific preferences. You'd like to buy shirt of
a particular size, selected from a set of your favoritecolors along with your preferred designs.
The design can be either a check, or plains, stripes or prints. Therefore on the part of the retailer
to make you purchase from that particular store it will be necessary to have those very
combinations which you require. This makes it indispensable on the part of the retailer to have a
strategic assortment planning. This indeed feels a lot of research into the consumer psyche as
well as planning well in advance. It would include the following three steps:

DETRMINING PRODUCT CATEGORIES

ORGANIZE THE BUYING PROCESS CATEGORY WISE

SET MERCANDISE BUDGET STIPULATION

DEVELOP AN ASSORTMENT PLAN

Activity 1
Make a visit to a location say 'X' supermarket and list as many product categories they have.
Now list the names of various brands in each category that have been kept in the shop. Select any
one category and ask at least 10 customers about their most preferred brand in that category.
Conduct the same survey in location 'Y'. Ascertain the difference if any in customer preference
and similarly a corresponding difference in merchandise planning in that specific category
between the two locations?

Determining Product Categories

While looking into assortment planning the first step is determining the product categories. Now
a question which can come to your mind is what is a category?

Categories can be defined in terms of brands in terms of nature of products, or even in terms of
specific consumer preference
Organize Buying Process Category Wise

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Once the categories have been determined, the next step is to plan the buying process
accordingly. Each product category may have a distinct feature or buying requirements. Buying
requirements can be different from the point of view that, specific expertise may be needed for
buying a particular category of products. For instance men's wear will be distinctly different
from women's wear from buying point of view. Similarly there can be other such differences in
procurement of different category products. Thus it will be in the interest of the retailer that
procurement of different categories of merchandise is looked into in their own unique ways.
Key Issues in Merchandise Assortment Planning
While initiating assortment planning you should always remember the key issues. You have to
take a decision of balancing amongst variety, assortment, and product availability. You have to
make an optimum level in all three. It's very simple to understand once you go into a retail store
you expect that first of all, the product you desire will be available and that, you will be shown
reasonable range of variety. Now from the retailer's perspective, in case you want to become a
one-stop shop in ready-made shirts then, you would give product availability and rightly more
emphasis. Therefore, you cannot carry large assortments. Similarly if you have in the shires to
have wide assortments in the given product category, then, you have to sacrifice variety.. One
interesting dimension in this context will be in case, passed over is interests in the variety aspect
of merchandising then he/she will have to outsource his merchandise from numerous vendors.
This decision of whether to have a great variety or not is taken at the top level. However, you
must appreciate the limitations of a retail store while taking such decisions.
Set Merchandise Budget Stipulations
In any commercial activity financial discipline is what leads to profits and success. A retailer
cannot even dream to earn profits unless he is able to forest the financial implications of his
merchandising activities. Financial planning is done at the top level. This financial plan is broken
into various categories which percolate to the lowermost level of the store. Based on the financial
plan given by the top management the merchandise managers as well as the buyers develop their
own individual financial plans, It is here that decision regarding the cost profit margins, sales to
stock ratio, expected return on assets, and inventory turnover have to be decided. Some relevant
equations in this regard can be as follows:

Returns on sales = net profit margin x asset turnover

= x

Sales to stock ratio =

Therefore its sales =Rs. 2, 000, 0000

And average cost inventory =Rs. 66, 000, 000
Then sales to stock ratio = =3
Inventory turnover =

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This equation looks into the productivity of inventory. This means if I invest Rs. 1, 00,000 in our
specific product than harmony of these can be generated from that investment. This means
greater the preference of the customers, greater is the off take of that product, thus greater is the
cycle frequency.
FACTORS AFFECTING MERCHANDISE MIX DECISIONS
a. Budget constraints
In merchandising budget seems to be the biggest constraint. The range of merchandise as well as
variety has become so large that it is impossible for the retailer to stock all varieties of any given
product. The retailer has to decide within his limited resources what sort of depth in each product
line he should maintain.
b. Space limitations
Every day scores of new brands are hitting the market. With the limited space as well as
resources any retailer has to take a decision regarding number of products or brands to stock in
his store. This in fact has gone in the larger interest of the retailers. Nowadays reputed retailers
with strong customer loyalty are charging slotting allowances from the manufacturers and
dealers to display their products. This has led to a battle of slots amongst the multinational
corporations and prominent manufacturers. However this constraint does not exist in case of e-
tailing: But, we should take note that entailing is still at a very nascent stage in India.
c. The rate of product off take
As explained earlier a retailer makes efforts to keep the depth in his .merchandise assortment to
satisfy the maximum number of customers. However this leads to another problem in case the off
take of the total product line is not sufficient. The more variety of merchandise a retailer keeps;
he himself is in the danger of unsold stock. Thus the retailer has to decide whether he would like
to go for a small product line with a great depth or limited product lines with large variety. This
decision however would save him of investing in dead stock.
d. Stock replenishment schedule
It is most essential for the retailer to know the replenishment schedule for his stock. He should be
well aware about his present level of inventory, reordering level, danger level, as well as the lead
time taken by the supplier or vendor to supply the goods ordered for. At any given point of time
the retailer must discount various factors like festivals, strikes, seasons etc which may affect the
supply of merchandise by the vendor. Moreover it is advisable that the retailer has the required
quantity and quality of merchandise available in good number at his store at the onset of any
specific season. For instance in a ready-made garment shop it will be wise on the part of the
retailer to order for sufficient quantities of specific garments much before the onset of the season.
This enables the retailer to not only stock the goods but also charge a premium in case of high
demand and scarcity of the product.

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MERCHANDISE PRODUCTS
1. Placing and arranging merchandise
1.2. Unpacking merchandise

To unpack is to take stuff out that's been packed, like the clothing in your suitcase or the
fragile item that's been buried in ten thousand Styrofoam peanuts. If a large shipment arrives at a
company, it may take several people to unpack the items and take stock of the contents.Many
items received into stock will need to be unpacked as part of the storage process.

Unpacking practices

When unpacking stock you must follow all house policies and procedures. For example, if the
venue had a „full‟ carton policy in the store rooms you would not unpack individual items from
cartons.

General requirements

Unpacking stock can require you to: Remove individual items from cartons and/or packaging
and load stock into storage bins or storage areas – see next section Check the quality and
suitability of every item unpacked to ensure:

 Items are not damaged or broken:

– Nothing is leaking

– No seals are broken

– Items, cans, drums, bottles, packets and sacks of goods are intact

 Use-by and/or best-before dates are appropriate to the usage rate of the venue

 Check to ensure no pests, rodents, vermin or dirt is introduced into the store through the
items being unpacked
 Verify items look suitable for the purpose they are to be used for using the various senses
(smell, sight, touch and taste as appropriate) and a combination of industry and venue
knowledge and common sense. This involves a quick check of each item to ensure (as
appropriate to the nature of each individual item):

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 Linen is the expected/correct color. If you know the property always uses white
sheets, it would cause concern if the delivery of sheets you were unpacking was blue
in color
 Fruit and vegetables are fit for the purposes they are going to be used for. This may
involve checking to ensure food intended to be eaten „as is‟ is free from blemishes,
are not bruised and are suitable for sale or use. Items to be used in stocks, stews and
sauces can be of lesser quality but must still meet internal specifications and all food
safety requirements
 Matches the information on the carton or packaging from which it is being taken
 The fitting for light globes matches the fittings in the venue. There is no point
stowing „bayonet‟ light fittings in store if the property uses „screw in‟ globes
 Adhere to „full box/carton‟ policy in stores where this is an internal requirement.
Merchandise may include but not limited to:
o Type
o Brand
o Size
o Customer needs
o Color
o Price
1.2. Placing e-merchandise

Ecommerce merchandising is the practice of displaying products strategically on a website to

increase findability, conversions, and revenue.E-merchandising is a marketing strategy that
utilizes some techniques that are usually called “leverage”.

1.3. Displaying merchandise

A merchandise display is the physical placement of products and items in a retail store. It
can be a powerful way to highlight a product or products' most important features and pique
customers' interest.

1.4. Identifying damage and out-of-date stock

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Damaged stock means any items of Inventory that, in the reasonable judgment of the Parties, is
not usable or saleable at full wholesale or retail price because of: (i) physical deterioration or
damage or (ii) a failure to meet the quality grade as classified by Seller.An expiry date (or
expiration date) in trading is the point at which a position automatically closes. In other
words, a trader will have to decide what they want to do with their open position before the
expiry date.

Out-of-date stock

Generally speaking, it is the responsibility of the venue to make sure they use stock before it
reaches it use-by date. However, in some cases, a supplier may be prepared to take back items
that have exceeded this date as a gesture of goodwill to a good customer/a venue that buys a lot
of stock from them. Checking the use-by dates of incoming stock to ensure there is still plenty of
life left in the products is a good way of preventing out-of-date stock needing to be cleared or
returned.

Product recalls

Where the supplier, the manufacturer or the authorities have issued a product recall there is a
need to return any items matching the individual recall notification. A credit note will be issued
for this stock or the supplier will arrange for exchange stock to be provided when the recalled
stock is collected. Excess stock Suppliers are under no obligation to pick up, exchange or
provide credit for excess stock but many do so, once again as a goodwill gesture. Where excess
stock is to be returned your manager will have discussed the matter with the supplier and agreed
about the quantity being returned and the amount of money the supplier is prepared to credit you
with (or the alternate type and quantity of stock the supplier will provide in exchange).

Unsatisfactory and poor quality goods

Any items failing to meet advertised claims or deemed not to be of „merchantable condition‟ can
be returned to the supplier. An exchange or refund (via a credit note) is the usual way of dealing
with goods of sub-standard condition, taste, appearance.

Important considerations

When returning goods to a supplier you should record:

Name of supplier to whom goods have been returned

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Quantity and description of goods returned

Date returned

Where possible also obtain a signature from the delivery driver stating they have taken the
identified stock – some will provide a special „credit return‟ document to this effect. This „credit
return‟ should be passed on to the office to help in processing the account.

1.5. Placing Stock range

Range defines the difference between the highest and lowest stock traded for a defined period,
such as a day, month, or year. The range is marked on charts, for a single trading period, as the
high and low points on a candlestick or bar.You sell stock in much the same way that you buy
stock. Place an order with your broker, and wait for the order to be filled through your
investment account.

Factors affecting orders placed and items ordered

The type, quality and quantity of stock ordered will largely depend on the individual
establishment or property placing the order:

o Nature and style of the property

o Amount of storage space available
o Rate at which items are used
o Money/credit available
o Customer/guest demand, needs, wants and preferences
1.6.Rotating stock

It is standard procedure all stock delivered into a venue needs to be rotated so the older stock is
used before the newer stock. Rotating stock is a system used especially in food stores and to
reduce wastage, in which the oldest stock is moved to the front of shelves and new stock is added
at the back. Stocking new merchandise behind or in place of old merchandise is known as
rotating stock.For that, there are two main stock rotation or inventory replenishment methods
that are worth noting. The first is First-In, First-Out (FIFO) while the second is First-
Expired, First-Out (FEFO). As for which process best suits your store and products, that's what
we intend to explore below.

What is the main rule of stock rotation?

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If products with an early sell by date are at the front, and later ones at the back, they will be sold
first. If things are organized the other way round, or stock is improperly rotated, newer stock will
be sold first, leaving out of date stock sitting on the shelves which will have to be thrown away.

Why is stock rotation important?

Stock rotation must be applied to help avoid situations such as:

 Stock loss due to items becoming out of date stock

 Stock looking old and tired by virtue of spending too long in storage. This stock is
unattractive and customers will not buy it
 Damage to stock – or a reduction in quality – that may occur if stock spends excessive time
in storage. The longer an item spends in storage the greater the risk of damage to it.

Does stock rotation apply to all stock? Generally speaking, yes. However there are limited
instances where certain products may be bought with the deliberate intention of not rotating
them. For example:

 Some wines may be bought and cellared for future use as a specific strategy to increase
their value
 Some meat may be purchased and deliberately kept to „age‟ it.
Stock rotation options

The four stock rotation options are:

 First In, First Out (FIFO)

 First In, Last Out (FILO)
 Last In, First Out (LIFO)
 Last In, Last Out (LILO)

What stock rotation system applies? The most commonly used method of rotating stock in
hospitality outlets is the First In, First Out method. This means stock should be used or sold in
the order it has arrived into the premises.

In practice this means you will need to:

 Move old stock forward and place the new stock behind it. Never load new stock in front of
existing stock

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 Lift existing stock up and put new stock under it

 Create a new storage area/stack for new stock and make sure the old stock is used before
this new stack is started
 Log the identification information on items (such as kegs of beer, cartons) when they are
delivered by date of delivery and then make sure you refer to this record when using kegs or
cartons to make sure you use the old ones first
 Check best-before and use-by dates and use oldest stock first.
1.7.Ensuring stock presentation

A stock market or equity market is a market for the trading of company stock.

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SELF CHECK-1 WRITTEN TEST

Name -------------------------------------------------- ID. No ---------------------

INSTRUCTION: Choose the best answer from the given alternatives.

1. According to American Marketing Association, ______________ is the planning involved in

marketing the right merchandise at the right place at the right time in the right quantities at
the right price.
A. Merchandising C. Stocking
B. Product D. Pricing
2. What is the first step in process of merchandising?
A. Understanding consumer needs
B. Planning the right assortment
C. Identifying and sourcing the right merchandise
D. Providing right quantities
3. Which of the following is not benefit of merchandising?
A. Lower sales C. More satisfied customers
B. Faster inventory turnover D. Increased customer loyalty
4. Stocking new merchandise behind or in place of old merchandise is known as _______.
A. Rotating stock
B. Stock presentation
C. Stock range
D. Placing stock
5. The most commonly used method of rotating stock in hospitality outlets is the ___________
method.
A. First In, First Out (FIFO)
B. First In, Last Out (FILO)
C. Last In, First Out (LIFO)
D. Last In, Last Out (LILO)

Note: Satisfactory rating -100% Score= --------------

You can ask your instructor for the copy of the correct answer Rating =----------------

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UNIT OF
COMPETENCY:


INFORMATION MODULE TITLE:

SHEET-2 


LO2. PLACE AND ARRANGE MERCHANDISE

INFORMATION TITLE:
PLACING AND ARRANGING MERCHANDISE

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2. Preparing and applying labels and tickets

What is a label?

Exactly what constitutes a label varies. There are three common, generic styles of labels:

 An adhesive label peeled from a roll of pre-printed labels

 A computer-generated document printed out from the stock management system
 A simple hand-written note or adhesive label with the relevant information written on the
label with a marking pen.

Supplementary reasons labels are used on stock items

Labels will mainly serve to identify the item but information on the label may also include:

 Directions to staff – “Use this first”, “Check with Graham before using”
 Advice to staff – “Last one – no more being ordered”
 Allocation of items – “For use by Kitchen/John Barnes only”.

An e-ticket (electronic ticket) is a paperless electronic document used for ticketing

passengers, particularly in the commercial airline industry. Virtually all major airlines now
use this method of ticketing.Tickets and labels communicate information about a product. This
allows customers to make informed choices about the products and services your store sells.

Tickets and labels need to be effective and eye-catching to attract the customers' attention and to
encourage them to buy the product.

We need to prepare two types of tickets:

 Display tickets

Display tickets, or signs, are used in window displays, table promotions, on walls, or in free
standing displays.Display tickets will be provided by the Visual Merchandising Manager upon
request. This will ensure that company standards for display are maintained.

There are five basic parts of a display ticket.

o The lead line – a short, catchy line eg. ‘Today only’, ‘Reduced’ or ‘New’.
o The head line - this should identify the merchandise, eg. ‘New SummerSuits’.
o The descriptive line - this tells the customer about the merchandise especially the benefits
that aren’t obvious, eg. “Made from cool wool”.

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o The price line - tells customers the price of the merchandise. The cents are written smaller
than the dollars to avoid confusion.
o The base line - describes the quality, conditions or weight of the merchandise, eg. “While
stocks last”.

 Price tickets

Price tickets are attached directly to the merchandise or on the shelf directly below the
merchandise. If each item of merchandise has a barcode, then the price will be recorded on a
shelf ticket. This is commonly seen in a supermarket.

Remember that effective tickets need to:

 sell the product

 give information that's not self-evident
 promote the product
 display the price of the product

Price tickets usually include the following information, whether they're printed or written by
hand:

 size, or quantity, of the merchandise

 date code
 bar code
 price per unit
 identification code

TICKETING
Ticketing and Re-ticketing
Ticket application, de-stubbing, pricecorrections, markups, markdowns,redline and
blackline.
Hang Tag Application
Cloth, string, plastic and custom tagsapplied by hand.
Joker Tag Application
Stitched or applied by hand witha tagging gun.

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LABELING
Size Labeling
Sort and apply size labels toprepare any type of garmentfor accurate distribution.
Pressure Labeling
Print and apply unique SKUs to ensureaccurate e-commerce distribution.
Carton Label Application
Print and apply box labels tostreamline transportation backto the distribution center.
Branding and Sew-In Labels
Sort and sew labels into garmentsby hand or using industrial sewingmachines for any type
of garmentto meet government, retail and/orbranding standards

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2.1.Preparing labels and ticket

Most stock delivered to a venue will already be labelled sufficiently for the purposes of storage
and general use of the item.

Where items are delivered without some form of appropriate identification, wrapping or
labelling, or where you need to take individual items out of packets, cartons or wrapping you
may need to provide your own labels for these items.

Labelling requirements

Activities involved in labelling stock can include:

Physically placing existing labels on storage containers and shelving in order to:

 Identify the stock items

 Display delivery date

Preparing hand-written and/or computer-generated labels and attaching them to individual stock
items

Using electronic bar coding and labelling equipment and attaching labels to:

 Shelves
 Containers
 Individual stock items

Observing food safety requirements in relation to the labelling of food such as:

 Labels, tags or spikes must not make direct contact with food
 Ensure day/date and time of delivery is noted on label
 Any re-packaged food items must be labelled with details of the original package/item.

Labels for stock items are usually positioned immediately above or below the item/shelf. In some
cases a label may actually be attached to the item itself. The primary purpose of clear and
accurate labelling is to identify clearly the items in stock; on the shelf or in other storage areas.
For example, it is virtually impossible to visually differentiate between:

 Single bed sheets

 Double bed sheets

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 Queen-size bed sheets

 King-size bed sheets
 When they are folded and sitting on a shelf.

Appropriate labelling overcomes this problem helping staff to easily identify and access the
correct size sheet and also helps with the placement of stock on shelves or into storage bins.

Preparation of labels and tickets includes:

o Pricing gun

Pricing gun is a hand-held device used in stores for fixing a price label to a product. A handy
item to purchase is a pricing gun, which is capable of mechanically printing your price codes on
the price stickers. Examples of retail store supplies your stockroom will need are pricing guns,
labelers, and box cutters.

o shelf tickets
o Shelf talkers are small printed tickets attached to a retail/ a piece of printed paper or
an electronic screen fixed to a shelf in a store, to bring attention to goods on that
shelf:
o written labels

A slip of paper, cloth, or other material, marked or inscribed, for attachment to something to
indicate its manufacturer, nature, ownership, destination, etc.

o swing ticketing

Swing tickets, or tags, are small pieces of removable card or other material that are attached
to a product by a plastic joiner or piece of thread or ribbon. Swing tags are the industry
standard for displaying product information, such as the size, material, price and wash care
instructions.

o Bar coding

Bar coding is an automatic identification technology that allows data to be collected rapidly and
accurately from all aspects of a company's operations, including manufacturing, inspection,
transportation, and inventory elements.

o price boards

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The Board Price is the display of odds by Sportsbooks or a bookie trackside at a horse
racing or greyhound racing event.

o header boards
2.2. Using electronic tickets equipment

Electronic Ticket (issuing) Machines (ETMs) are machines with computer processers and
memory, which issue tickets for travel. While they vary in size and configuration, the basic
elements are: Microprocessor(s) Memory (fare table, rules, and transaction data)
What are the components of electronic ticket?
An official ticket number (including the airline's 3-digit ticketing code, a 4-digit form number, a
6-digit serial number, and sometimes a check digit) Carriage terms and conditions (or at least a
reference to them) Fare and tax details, including fare calculation details and some additional
data such as tour codes.
2.3.Identifying incorrect labels and tickets

Identifying incorrect labels and tickets are mandatory in merchandising products. Therefore
marketing professionals should always handle product labels and tickets in a planned way.

2.4.Maintaining labels and tickets

Ticket labels can be used to categorize your tickets by whatever you need such as subject,
priority, complaint, etc. Tickets can be labeled in the chat, mail and solved view.

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2.5.Placing labels and tickets

After you've prepared price and display tickets that suit the image of the store, you need to
position the ticket in the right place on the merchandise.

New merchandise and advertised lines need to be placed in the areas that will attract most
customer attention:

• In areas of greatest customer traffic flow.

• At the front of the department.

• Near the counter.

Merchandise that sells well or has a high profit margin must be placed in the prime retail
position. This is the position on a fixture that is between the eye and hip area.

Make sure that fixtures are placed in a position that allows easy access for customers, prams and
wheelchairs within each department.

2.6. Replacing labels and tickets

Labels and tickets should replace according to store policy. Based on the principle of store
policy, any business organization could be implemented to save time and resource.

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SELF CHECK-2 WRITTEN TEST

Name -------------------------------------------------- ID. No ---------------------

INSTRUCTION: Choose the best answer from the given alternatives.
1. An ___________ is a paperless electronic document used for ticketing passengers,
particularly in the commercial airline industry.
A. E-ticket (electronic ticket)
B. Tele marketing
C. Commercial business
D. International marketing
2. An automatic identification technology that allows data to be collected rapidly and accurately
from all aspects of a company's operations is______
A. Bar coding
B. Swing tickets
C. Pricing gun
D. Labeling
3. Of the following, which of the following is not included in preparation of labels and tickets?
A. Shelf tickets
B. Shelf talkers
C. Electronic Ticket
D. Header boards

Note: Satisfactory rating -100% Score= --------------

You can ask your instructor for the copy of the correct answer Rating =----------------

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 Training, Teaching and Learning Materials (TTLM)

UNIT OF
COMPETENCY:


INFORMATION MODULE TITLE:

SHEET-3 


LO3. MAINTAIN DISPLAYS



INFORMATION TITLE: MAINTAINING DISPLAYS

3. Maintaining displays

Many stores create special displays for promotional purposes. These creative displays are
designed to attract the customers' attention and to encourage them to inspect the merchandise
more closely.It's great to attract lots of shoppers into your store, but if they don't convert into
sales then all your effort is easily wasted. A well-executed retail display can help maximize
conversions so that browsers become customers.The four basic types of displays are those
that feature one item; similar products; related products; and a cross mix of items.

3.1. Displaying unsuitable and out-of-date

Special promotion areas may include but not limited to:
o permanent or temporary
o interior or exterior

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o publicly accessible
o windows
o shelves
o wall fixtures
o on floor
3.2. Assisting supervisor display

Supervisors assist in selection of merchandise products for display. A sales person should use
effective communication with his/her supervisor.

3.3.Arranging and facing up merchandise

In the retail industry, facing (also known as blocking, zoning or leveling) is the practice of
pulling products forward to the front of the display or shelf on which they are placed, typically
with the items' labels facing forward. This is done to keep a store appearing neat and organized,
and can help create the illusion of a perfectly stocked store.

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3.4.Maintaining correct pricing information

There are government regulations to ensure that information on tickets is accurate and
appropriate for the goods they describe.

Any company must adhere to the Fair Trading Laws. These laws are:

o All tickets must describe the merchandise truthfully in terms of the standard, quality, value,
grade, composition, style, price or model.
o If a ticket has more than one price on it then it is unlawful to sell the goods for more than the
lowest price. The goods can either be sold at the lowest price or withdrawn from sale.
o A ticket must state the item that is for sale and the full cash price for that item, including all
parts of that item.
3.5.Identifying and replenishing stock levels

Stock replenishment is a process that ensures product flows through the supply chain at an
optimal rate for fulfilling orders while holding costs low. Demand forecasting and
optimization of physical storage space are good first steps for an effective stock replenishment
process.

3.6. Removing excess packaging

Reducing the amount of packaging we purchase can help to significantly reduce our use of
natural resources (including water and energy) and minimize the amount of waste going into
landfill.

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SELF CHECK-3 WRITTEN TEST

Name -------------------------------------------------- ID. No ---------------------

INSTRUCTION: Choose the best answer from the given alternatives.
1. A process that ensures product flows through the supply chain at an optimal rate for fulfilling
orders while holding costs low is __________.
A. Stock replenishment
B. Stock range
C. Stock rotation
D. Stock packaging
2. Special promotion areas do not include
A. Stock rotation
B. Interior or exterior
C. Publicly accessible
D. Windows
3. Any company must adhere to the Fair Trading Laws except
A. All tickets must describe the merchandise truthfully in terms of the standard, quality, value,
grade, composition, style, price or model.
B. If a ticket has more than one price on it then it is unlawful to sell the goods for more than the
lowest price.
C. A ticket must state the item that is for sale and the full cash price for that item, including all
parts of that item.
D. If a ticket has more than one price on it then it is lawful to sell the goods for more than the
lowest price.

Note: Satisfactory rating -100% Score= --------------

You can ask your instructor for the copy of the correct answer Rating =----------------

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 Training, Teaching and Learning Materials (TTLM)

UNIT OF
COMPETENCY:


INFORMATION MODULE TITLE:

SHEET-4 


LO3. PROTECTE MERCHANDISE

INFORMATION TITLE:
PROTECTING MERCHANDISE

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4. Protecting merchandise

Merchandise that is on shelves, or on display, needs to be protected to make sure that it

always remains at its best.Protecting deals with ways in which you can handle, store and
display goods so that they do not get damaged or broken in any way.

4.1. Identifying and applying correct handling storage

Material handling is the movement, protection, storage and control of materials and
products throughout manufacturing, warehousing, distribution.

4.2. Appling displaying techniques

Merchandising is the arrangement of products in a physical or online store to maximize sales.If
the merchandise that is selected does not fit with the theme or the style of the display it can be
off setting to the customer, which can lead them not to purchase the item.

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SELF CHECK-4 WRITTEN TEST

Name -------------------------------------------------- ID. No ---------------------

INSTRUCTION: Choose the best answer from the given alternatives.
1. Which of the following factors are not affecting merchandise mix decisions?
A. Enough budget
B. Space limitations
C. The rate of product off take
D. Stock replenishment schedule
2. _________ deals with ways in which you can handle, store and display goods so that
they do not get damaged or broken in any way.
A. Protecting
B. Recycling
C. Reusing
D. Stocking
3. The movement, protection, storage and control of materials and products throughout
manufacturing, warehousing and distribution are known as_________.
A. Material handling
B. Material storage
C. Material damaging
D. Material stocking Score= --------------
Rating =----------------
Note: Satisfactory rating -100%
You can ask your instructor for the copy of the correct answer

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