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Part Two Apparel Industries
Resident buying offi ces (RBOs) are service
businesses located in major market centers
where there are many sources of goods, such as
New York City, Los Angeles, Hong Kong, etc.
Independent resident buying offi ces are hired
by noncompeting member retailers from many
parts of the country selling similar goods.
Another type, retailer-owned resident buying
offi ces, is operated by large retail companies only
for their stores or sites. Most of the merchandise
purchased for all of the company’s branches is
done centrally at these buying offi ces.
Resident buying offi ces provide their mem-
ber retailers with trend forecasting and global
supply information. They send news bulletins
electronically about new items, best sellers, price
changes, supply conditions, and other develop-
ments. They sometimes set up market appoint-
ments with certain apparel fi rms for visiting
buyers. They may recommend suppliers and
accompany buyers on calls.
If requested, resident buying offi ces will do
the actual buying for retailers. They will follow
up on shipments of orders, place reorders, and
fi ll-in orders for fast delivery. They will also pre-
pare sample advertising, direct mailing pieces,
and promotional ideas for their member stores.
Fees charged by resident buying offi ces vary
in relation to the types and amounts of services
provided. Group buying is most important to
small merchants. The clout of all the retailers
as a larger group can result in lower prices
(through quantity discounts) and more reliable
deliveries.
Timing and Pricing for Demand
Merchandise is offered by retailers well
ahead of the wearing season. Thus, consumers
are urged to buy their summer garments in the
spring. Retailers try to sell all of their shorts,
swimsuits, and other summer attire by July 4th.
Fall clothes are made available in midsummer.
Retailers like to be sold out of their seasonal
merchandise early, as insurance against con-
sumers changing their minds when the season
arrives. However, consumers are now objecting
to this type of timing. They prefer items to be
available during the season of wear rather than
only before the season.
Retailers must constantly be aware of con-
sumer desires. They must notice changes in
consumer lifestyle patterns and tastes. Consumers
make the fi nal decisions about what will, or will
not, sell. If the public is not ready for certain
styles, they will not move. To encourage sales,
the presentation of items by retailers must edu-
cate consumers about how to wear or combine
articles of clothing. Retailers must show how
to put together and accessorize outfi ts. In this
way, they can create consumer demand through
understanding.
Retail buyers must try to order the correct
number of stock keeping units (SKUs). SKU num-
bers give the style, color, size, vendor, and other
chosen information for each item. See 7-9. The
items that sell quickly may not be available for
reorder because manufacturers may already be
working on the next season’s line. That causes
the retailer to lose the opportunity of additional
sales dollars. Buyers must also try not to order
more than consumers will purchase. Goods left
over will be sold at reduced prices. This causes
7-8
During market weeks, manufacturer’s showrooms
display all merchandise as nicely as possible to entice retail
buyers to order goods for their stores, catalogs, and websites.