- 10 Jun 2011
Merchandising and IT Departments
By Frances Thomas, IT Business Development Manager at Retail Assist
In any large business, there is always the likelihood that at best, certain internal teams are not aware of the nuances of the tasks fulfilled by other teams; and at worst, they are completely unaware of any areas of work that they are not directly exposed to on a day-to-day basis. Due to the wide array of departments that make up most retail businesses, these are rarely exceptions to the rule.
Historically it was the Merchandising teams that were the key contacts for IT within the Buying and Merchandising departments. The need to maximise profit through stock management was responsible for driving the development of sophisticated Merchandise Management and Management Information Systems. As customers became more demanding and trading conditions more difficult the Merchandise teams relied upon the IT solution to provide flexible, responsive systems that supported fast delivery of product to market and provided the product performance data as soon as possible.
My merchandising background and IT experience mean that I am in the unique position of appreciating the key drivers for both areas. I believe there is a great opportunity for merchandising teams and IT departments to learn from each other and deliver greater results.
When transferring from Karen Millen’s merchandising team to the IT department, I was struck immediately by a difference in pace. The merchandising teams in fashion retail work in a high pressure environment to a routine of deadlines. Certain tasks and information have to be completed within set timescales in order to make informed buying and trading decisions, these in turn drive sales and maximise profit. There is only one opportunity to sell a product at that product’s first price. After this every action erodes margin. Preventing this erosion is vital and this is reflected in the working environment of the merchandising team. IT needs to understand what is important to the merchandising team and respond to this with the same sense of urgency and priority to truly work in partnership. The Merchandising teams can assist IT by explaining the role and the priorities and giving context to the tasks that IT perform for them.
In contrast, IT is divided into several departments each of which work to different deadlines and pressures but all impact the merchandising team in some way. This variety of the IT roles is not always fully understood by the merchandising teams. Desktop, Help Desk and development teams all play a part in supporting and underpinning the business. Understanding what IT does and what IT can provide is a major advantage to a team competing for the customer and the sale. Merchandising teams have a great opportunity to really understand what IT provides and support IT in improving the systems and IT services.
IT teams are involved in all aspects of the supply chain, and wider business resulting in an in depth knowledge of the processes and systems as a whole. Tapping into this knowledge offers the merchandising teams a great opportunity to ensure a holistic approach to resolving issues and improving systems.
The IT team aid the merchandising team when any system change requests are made and any systems training required. However it is important for Merchandisers to recognise the challenges that developments pose, alongside the opportunities created by them. The highly logical and process driven nature of IT departments can be invaluable for Merchandisers when planning user groups, reviews and planning future best practise.
Equally; understanding the business from the merchandising perspective means a greater understanding of the wider trading challenges. Ensuring that IT strategy is aligned with the needs of the key business drivers is crucial in ensuring that IT developments support the growth of the company and the ability to trade competitively.
Due to the highly seasonal nature of the retail industry, IT teams must recognise the life cycle of products and how they drive process. Also they must appreciate that this cyclical environment affects merchandising strategy and the way that the team works; meaning that some of the demands they make on the IT department will be high priority, and require an immediate response.
The merchandising teams tend to be highly driven by their department performance, sales and margin, and any IT applications need to facilitate easy visibility of this. The IT team are tasked with providing systems that cater to external customer expectations, such as multiple purchasing channels, alongside internal requirements.
In conclusion, many merchandising and IT departments at large retailers are already adept at recognising each others’ key requirements and motivations. However, the more the teams are able to work together and the more closely their strategies are aligned, the more joined up and ultimately the more successful the retail business can be as a whole.