Trying to understand the apparel industry

[AffiliateDreamer]

Ok I hope someone can clear this up for me, it seems pretty mind boggling at the moment.

You sell clothing, so you have to buy products that come in various sizes and colors.

So you sell productx, you buy the same product in 3 sizes, and you buy 2 for each size.

So to break it down:

= ProductX * 3 sizes * 2 quantity
= 6

So you want to sell 10 pairs of pants, that means you are going to buy 60 products in total (6 per style as outline above).

Now we must factor in the seasons: spring, summer, fall, and winter.

What does one do with the left over inventory that doesn't sell? Styles change, depending on how much people care about the latest trends this could become a huge problem!

Is there an industry standard for unsold apparel?

I understand you could always sell leftovers on ebay, or to liquidators, or have a annual warehouse blowout sale, etc.

Any book recommendations to get an better grasp of the entire process?

thanks!

[Easy_Coder]

Have you negoiated stock rotation with your supplier?

[mida68]

My clients just mark it down 40% and stash it in a Clearance category - eventually it will sell. You have to expect that a certain percentage of your stock is not going to sell out at full price. My clients also price the items abvove keystone as requested by some designers. They would gladly sell it below keystone as their overhead is low (online only) so the 40% off to get rid of stock is not a problem for them.

Hope that helps!

[AffiliateDreamer]

Easy_Code, no i haven't discussed that at all (I have only approached a few designers thus far)...I never knew that option was even on the table!

[flyingpylon]

I never knew that option was even on the table!

As an aside, I never would have known either. I'm getting into ecommerce as well (though not apparel), and it is exactly these types of things I'd like to learn more about. I keep looking for a book or a site or something that would walk me through the basics of retail merchandising (preferably without an emphasis on physical stores) but I have yet to find it.

[CernyM]

I never knew that option was even on the table!

As an aside, I never would have known either. I'm getting into ecommerce as well (though not apparel), and it is exactly these types of things I'd like to learn more about. I keep looking for a book or a site or something that would walk me through the basics of retail merchandising (preferably without an emphasis on physical stores) but I have yet to find it.

Its not really an option for the majority of small apparel retailers. Manufacturers, especially those with established lines, are of the "you buy it, you own it" philosophy.

Large retailers carry more weight and can force some manufacturers to guarantee that some or all of their goods will sell through.

[Easy_Coder]

You won't know it's an option until you ask. Sometimes these deals come with purchase commitments on your part... which is fine but you need to have the ability to rotate stock once per quarter or maybe quicker/later based on your inventory turns. Otherwise it's a one sided relationship that's not in your favor.

I have a customer in the apparel space and they have a 100% return policy with their supplier for everything except items purchased on closeout. This customer is selling on average roughly 250K annually in apparel so they're small. The supplier is a global multi-billion dollar organization. So, it's doable for you to get conditions that are more partnership like.

[AffiliateDreamer]

Another hurdle I have to cross now are buying cycles.

It seems manufactures launch their lines 6 months in advance of the season, so you have to make your orders very early.

Ofcourse a seasoned store won't have much issues with this, but a new store has no idea of projected sales etc. so its pretty hard to plan out inventory styles/quantity!

[jsinger]

Apparel has been easy recently. Wait till hemlines rise or fall dramatically. mini skirts, maxi skirts. When one is in, the other is unsalable.

Flares, boot cut, straight leg pants. Fabrics (denim: in or out this month? LOL) Bright colors? Pastels? Earth tones? What is MTV wearing...this week? Low waist girls pants died three months ago...instantly!

The life of the average B/M womens clothing store in measured in nano-years. Especially true for stores that target teen girls.