Chapter 7 Fashion Promotion and Retailing
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fi nancial losses. Good buyers seem to have
instincts about what and how much their stores
will need. Also, sales data from check-out com-
puters tells them which items are increasing or
decreasing in popularity.
Some markdowns are planned for sales
promotions, hoping to attract more shoppers.
However, some retailers have been criticized
for overdoing price promotions. In the effort to
provide marked down merchandise to please
consumers, retailers sometimes fi rst mark up the
goods to higher-than-normal prices. This means
the sale price is really the retailers’ regular
price. This practice allows their margin (money
made or profi t) to be acceptable fi nancially. In
the long run, if such promotions run constantly,
retail companies lose their credibility with cus-
tomers. The pricing policies and ethics of the
retailers are questioned.
Private Label Brands
Private label merchandise is produced
specifi cally by or for a retailer. The trademark
or brand name on the label is owned by the
retail company that sells the goods, rather than
by the manufacturer. The merchandise is pro-
duced exclusively in the colors, patterns, styles,
and fabrics the retailer specifi es.
Retailers provide specifi cations (specs),
and usually samples, of the designs they want
produced by the contracted sewing shop. Some-
times they supply the fabrics. Often the goods
are very similar to national brands and made
by the same factory. Sometimes retailers pur-
chase a manufacturer’s line and have it carry
their own private label. Some retail companies
even have their own manufacturing plants.
Through private labels, retailers are entering
the apparel production business. Product devel-
opment directors are assisted by buyers in estab-
lishing the basic items and fashion copies to be
made for their companies, as in 7-10. Product
developers need a thorough knowledge of
fabrics and manufacturing methods.
There are various advantages to private label
programs for retailers.
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Retailers have exclusive design control.
They can specify the quality, fi t, price, and
packaging of their items.
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Retailers pay less than regular prices for
the goods. Expenses for the merchandising,
designing, and selling functions of a
manufacturing fi rm have been eliminated.
The retail company can then have higher
markups and better profi ts.
7-9
Each different item in the inventory of this store, such
as red-and-white shirts, green jerseys, yellow pullovers, etc.
has a different SKU number.
7-10
Retail product developers plan private label
merchandise and arrange for production of the items.