Men’s Dept. ‘The Rail’ Applied Buying By Quinn Nevares
Dec 13, 2014
Men’s Dept. ‘The Rail’Applied BuyingBy Quinn Nevares
Company Overview
Company Overview• 1901 John W. Nordstrom & Carl Wallin
opened a small shoe store in Seattle, WA
• Corporate Headquarters: Seattle, WA• Annual Sales Fiscal 2013: $12.15B
• 1 year growth +11.69%
• Q2 ‘13 Highlights• Total company net sales $3.1B – +6.4%• Same store increase of 4.4%• Top performing merch. categories Men’s Shoes, Men’s Apparel and Cosmetics
• Men’s Contemporary Dept.: ‘The Rail’• Downtown San Francisco, CA • Westfield Mall• Fall 2013
‘The Rail’ Target Audience
Target Customer #1 • Jason• 17 years old• Applied to UCLA• Lives in Noe Valley• Supported by HSL income of
$200,000• Plays fantasy football, brand
conscious, enjoys video games and hanging with friends
Target Customer #2• Zack• 28 years old• Bachelors Degree from UCSF• Creative Technical Consultant for Google• Income $75,000• Lives in Russian Hill• Enjoys bike riding, alternative music, drinks local coffee and loves the SF Giants
Strengths • Men’s shoes and apparel top
performing category’s – Q2 ’13 Disciplined execution of expenses and inventory
• Strong communication with customer – lifestyle blog, social media, and online store
Opportunities • Expand outdoor and active
lifestyle merchandise category – more styles, more colors
• Marketing strategy – create exciting events that are dept. specific to drive traffic
• Expand brand partnerships
Weaknesses• Merchandise mix weighted
to fashion items – not enough basics
• Appeal overall to younger demographic with styles and colors
• Weak execution of promotional strategy – Anniversary Sale under-delivered
Threats• Weak economy may result
in inability to make sales plan
• Store expansion will create higher operating expenses
•Market Trends• Political Factors: -3%• Internet tax bill may threaten online sales•Newly appointed International Trade Representative – affecting cost of foreign labor and imported goods
• Economic: -2%• SF Bay Area one of lowest unemployment rates in CA 7.4% • Inflation projected 2% - up .3% from 2012•Retail Industry hopes to see increase in employment opportunities – expansion in domestic manufacturing
Market Trends• Social Factors: - +3%• Consumer Price Index is up +1.5% • Consumer Credit is up +1.9%• SF Tourism is up +1% and spending +5.5%
• Marketing & Promotional Plans - +5%• Private Holiday Shopping events for Fashion
Rewards Holders• Customers earn reward points and enjoy
free holiday treats, music and exclusive offers
Nordstrom’s Current Sales - visual• Sales to date for 2013 $5.7 B• Year to date same store sales increase of
+6.2%• Plan to open 3 full line stores in 2014, and
flagship in Manhattan by 2018
6 Month Plan• Projected Sales Plan: +7.2%• Plan Turnover of 1.7• Total Markup Percent: 55%
Current Sales • Sales to date for 2013 $5.7 B• Year to date same store sales
increase +6.2%• Plan to open over 25 stores in 2013,
and flagship in Manhattan by 2018
6 Month Plan• Projected Sales Plan: +7.2%• Plan Turnover of 1.7
• Total Markup Percent: 55%
Merchandise Mix Modifications
Tanks15%
T-Shirts35%
SS Button Ups30%
Shorts20%
Summer ’13 Assortment Mix
Denim30%
LS But-ton Ups25%
Sweaters25%
Jackets
20%
Fall ’13 Assortment Mix
• Added 30% denim for back to school and fall • Sweaters included for fall fashion trends - 25%• Jackets introduced for colder weather – 20%
Merchandise Mix Modifications
Blue/Green30%
Red/Orange35%
Graphics35%
Summer ‘13 Color Mix
Dark Red28%
Olive Green22%
Grey/Neutral30%
Black20%
Fall ‘13 Color Mix
• Modified graphics to gray tones – decrease 5%• Incorporated basic black into 20% of color mix• Dark red and olive green reflect fall color
trends
Fashion Trend Forecast• Upcoming fall trends show
neutral earthtone color palates• Rugged and outdoorsman
inspired – megatrend ‘Migration’• Incorporate floral, plaid and
tapestry accents• Well tailored pieces and layers
are key – fit is everything
Private Label Program: RailExclusive• Department was saturated with trendy colors
and fashion prints and graphics, need for basic styles/colors
• Introducing 2 key basic essentials:• Crew neck T-shirts w/ printed pocket for August• Zip- Up Hoodies w/ printed lining for September
• Launch for back to school, beginning of Fall season
• Apply additional 2% MU to overall plan of 55%
Private Label Program: RailExclusive
• Department saturated with trendy colors and fashion prints
• Need for basic styles/colors• Introducing 2 key basic essentials:• Crew neck T-shirts w/ printed pocket for
August• Zip- Up Hoodies w/ printed lining for
September• Launch for back to school, beginning of
Fall season• Apply additional 2% MU to overall plan
of 55%
• Men’s Basic V-Neck T Shirt
• Budget: 30% of LS Shirts Purchases for August - $23,700
• Price: $28.00/845 Units• Opportunity• Basic neutral colored T shirts
in White, brown and army with graphic print pocket and sleeve lining• Great opportunity to increase
markup and profit margin
• Men’s Zip-Up Hoodie• Budget: 50% of Sweater
Purchases of Sept - $20,200• Price $42.00/480 Units• Opportunity• Solid color options of dark gray,
maroon and black with hoodie printed hoodie lining and cuffs
• Promotional Event: Fashion Show Event
Fall ‘13 collection• Hosted and DJ’ed by Joshua Kissi and Travis
Gumbs of Street Etiquette - -successful men’s fashion/lifestyle blog
• First 100 guests will receive free Jack Spade iPhone case
• 20% discount on Jack Spade collection and RailExclusive
• Music, beverage and snacks • Styling tips from hosts Joshua and Travis• 10% of proceeds go to Project Open
Hand
Marketing Calendar:
August 5th send out postcard mailers to customers w/in 50 mile radiusAugust 12th email blastsAugust 19th announce event details on Facebook, Twitter, YouTube, Instagram, Tumblr and post on Men’s Shop BlogSeptember 9th repeat social media announcementsAugust 14th -September 14th promote w/in store hand out flyers/display invitationSeptember 14 Fashion Show September 14-15 20% discount on Jack Spade and RailExclusive