Catalog Merchandising: Market Musings from a Chief Merchant

Mar 01, 2004 10:30 PM  By

As a veteran buyer in the home decor and furnishings industry, I have seen more product trends come and go than most other merchandisers in today’s market. Many of my peers have, for the most part, retired or finally left retail, never to return. But because merchandising is my passion, I am still at the markets constantly asking myself “Will this item sell?” A corollary question is “Will this product be a BM?” — a “born markdown,” as we used to say in the old days.

In the days of yore, as a young naïve buyer with catalog/retail giant Federated Department Stores, I had my neat merchandise classifications — barware, collectibles, decorative accessories, floral; I had the New York Gift Show; and I had a gut instinct. So I figured, What else did I need?

Even better, we had our Associated Merchandising Corp. (AMC) “all world” import meetings in Munich, where we were presented with the best items and ideas chosen for us by our AMC coordinators. That saved us many merchanding trips around the world, and we were in retail heaven!

Well, life as a merchant has definitely changed. The challenges of being a successful buyer are manifold. A buyer has to be smarter than ever. A mail order merchant has to shop every domestic market as well as in Asia and Europe so as not to miss a trend or a new item. A buyer has to know what the competition is running in their catalogs. A buyer has to try to get product exclusives — even though he or she may be buying only 50 pieces.

So it’s not easy to be a buyer today. I’d say that only after amassing as much trade market exposure as possible and subliminally digesting as much information on one’s categories can a buyer truly make an intelligent decision about an item.

The China syndrome

Having just returned from the megamarket of all markets, the Atlanta Gift & Home Decorative Show, I can safely say that, as never before, we have a deluge of merchandise, and it’s all coming from the megacountry: China. The treasured Italian ceramics, handpainted with the talent of their ancestry, are now coming from China. Glassware, artfully blown in Portugal, is now imported from China.

Furniture, handcrafted in Italy as well as in our own North Carolina, is now being imported from Indonesia and, you guessed it, China. You now have domestic importers bringing in merchandise from China as well as the Chinese bringing it in themselves even cheaper than the importers!

The good news is that the quality of the items coming from China is high while the price points remain low. The downside is that now everyone else sourcing at the major markets has access to the same goods at the same price points.

It is a struggle to find new merchandise, and sourcing yourself with a product development person is the ideal situation. Finding or developing your own exclusive product is always a preferable situation.

Once the buyer has decided to pursue a product from an overseas vendor, the next question is “Do I import this item myself, or do I go through an importer?” Another important factor to consider: To import goods, you will have to meet a manufacturer’s minimum requirements. This could mean committing to least 1,000 units, for example, depending on several factors including the product, the price, the factory, and the country of origin.

If you go through an importer, he takes the risk, but you have fewer margin points. If you import the merchandise yourself, then you take the risk — but you gotta love that markup! There should be at least a 10%-20% gain in markup when you are directly importing. What so many catalogers forget, though, is that you achieve the markup only when you sell the item!

Let’s assume you’ve decided to use a company to import the products for you. Now you have to decide which importer: Who will I work with, how will they get the goods here, and will the merchandise shipment be on time and in good condition? What if the item sells like hotcakes — how soon will I be able to get more of it? As with any vendor relationship, you’ll want to choose your importing partner wisely.

This brings up a whole other topic — the issue of supplier relationships. Connecting on some level with individuals is of prime importance, not only in our personal lives but in our business lives as well. Think of your vendors as partners.

The relationship between a merchant and a vendor is a lot like a marriage — you have to compromise on all levels, but in the end the question of credibility and trust is the primary one.

The glamorous life

Being a merchant is perhaps more challenging today, but the job has always required a lot of hard work. So many people have said to me over the years that, as a buyer, I had a “glamour job.” Yes, I did get to travel to all the exotic places in the world and eat in fabulous restaurants in places like Florence, Venice, Paris, and London.

But the flip side of those perks are the challenges involved in trying to find the one item out of many that will be a winner. Time and again I find myself recalling the mantra of one of my associates: “I’m a merchant, not a magician!”


Kathy Revello (krevello@aol.com) is president of Kathy Revello Associates, a catalog merchandising consultancy based in Sunnyvale, CA.