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Dhyana van der Pols

SOURCING & CALCULATIONS: MARKET ENTRY


HOW TO BE PREPARED?
Sourcing- design- product calculations
Sourcing & Calculations
Content
1. Product
Calculations:
Collection Diamond
2. Trade offer: Product
& Sales Structure
1. Product Calculations

1.1 Bottom up calculating


1.2 Top- Down
1.3 Retailer Price Brackets/ Categories
1.4 Your sample collection
Product Calculations
1.1 Bottom up calculating
• Fabric+ consumption
• Trims
• Accessories
• Packing
• Washing
• Embroidery
• Bank & Handling
• Payment conditions: f.i. 10 days 4%
• Delivery Conditions: DDU- In warehouse/ at border
• 5% unforeseen
• 2% seconds- defects
• Profit margin
• Agent fee or trade channel fee
• Final price
Product Calculations
1.1 Bottom up calculating
• Costing sheet calculation
assignment
1. Trouser
1. Product Calculations
1.2 Top- Down: Mark-up

• Importing Wholesaler: + 25%-40%


Importing Manufacturer : Buy at 10
Euro; sell at 17; in store at 59,95
Euro
• 59,95: 3,4= 17,6x 40% minus=
10,5 Euro
• Retail Chain Group + 45%-55%
1. Product Calculations
1.2 Top- Down: Mark-up
59,95:3=19,9 retailer mark up between 2,6-
3,4
19,9:1,7=11,7 importer/ wholesaler mark up
11,7:12%import duties=10
10 minus CIF/ air shipment=8,50
8,50 including 15% GM= 7,3 manufacturing
cost
Product Calculations
1.2 Top- Down
Exporting manufacturers

Importing Wholesalers Importing Manufacturers Agents

Importing Retailers

Home Selling
Department Clothing and/or Other
Stores multiples Shopping retailers
companies buying
houses

Non importing retailers


Product Calculations
1.3 Retailer Price Brackets/ categories

Collection Diamond
Product Calculations
1.3 Retailer Price Brackets/ categories

Collection Diamond

Basic
NOS15%
Core collection
Profile 6-14%

Basic 20% Core concept


45-58%

Collection Diamond
vBasic: NOS: never out of stock: Service Products
vCore: mainstream collection: concept
vProfile Items: trends+ window stoppers
Product Calculations
1.3 Retailer Price Brackets/ categories

Collection Diamond
Collection Diamond
vBasic: NOS: never out of stock: Service Products
vCore: mainstream collection: concept
vProfile Items: trends+ window stoppers
Basic
NOS15%
Core collection
Profile 6-14%

Basic 20% Core concept


45-58%

Basic: T shirt long/short sleeve/ round/ V neck


5 pocket twill trouser
Basic jeans in 4 waist/ 2 inseam sizes
Stock service products at non seasonal prices
Fixed retail value
T shirt: 9,95-19,95
5pocket Twill: 39,95-49,95
Jeans at 39,95
Product Calculations
1.3 Retailer Price Brackets/ categories

Collection Diamond Core concept: Thematic


fashion actuals:
seasonal collection 4-6
Basic
times a year
NOS15%
Core collection Identity collection;
Profile 6-14%
fashion statements,
Basic 20% Core concept
45-58% seasonal colors, all
relevant style details
Divided over themes
and color cards
Product Calculations
1.3 Retailer Price Brackets/ categories

Collection Diamond
Profile items
Catwalk styles, Window
Basic stoppers, Trend setting/
NOS15%
Core collection adapting; “style lab”
Profile 6-14%
Diesel f.i.
Basic 20% Core concept
45-58%
Communicating you are
up to date and informed
and able to translate
design elements in RMG
Product Calculations
1.3 Retailer Price Brackets/ categories

v Basic: NOS: bigger volume- repeat orders: small


prices: commodity
v Core collection: big sample collections, sales men
samples, showroom selling; no repeats- max.
3000pcs per style: mid price level: profits above
10%
v Profile items: small series, luxury part of collection:
GM 15%+
Product Calculations
1.3 Retailer Price Brackets/ categories

Example: WE GROUP
v Basic T- shirt: 9,95
v Basic polo: 19,95
v Basic shirt: 19,95
v Basic trouser: 39,95
v Collection: 49,95/ 59,95/ 69,95
v Profiled Items: 89,95, 119,95, 139,95
Product Calculations
1.3 Retailer Price Brackets/ categories

Collection Diamond
Your sample collection

Basic
NOS15% First determine which
Core collection part of the diamond is
Profile 6-14%

Basic 20% Core concept yours to shine


45-58%
Product Calculations
1.4. Your sample collection
Collection Diamond Your sample collection
should be:
vUp to date – trend
Basic following for mainstream
NOS15% customers
Core collection
Profile 6-14%
vContain the season style
Basic 20% Core concept elements
45-58%
vRight color: seasonal
vRight fashion fabric/
print/ texture
vRight accessories: zips,
puller, drawstrings,
labels!!, buttons
vRight washing
Product Calculations
1.4. Your sample collection
v Should be labeled properly with:
v Date
v Style number/ reference customer Client code
v Size, pattern code
v Collection reference: theme winter 2007
v Your address data/ contact data
v Fabric code, description
v Washing Code if applicable
v Optional Price
v Optional Delivery conditions
2.1 Sales Structure: Chains/
Channels & Commissions

• Agents/ Local buying houses: 7-12% on


product price or CMT price
• Agents: independent: min. 10% + bonus
• Agents: selling capacity: 5% commission
• Sales organization in target market
• Sales representative: on pay roll
• Importing manufacturers: 1,4- 1,7
2.2. Sourcing Strategy : What do you
control? Pre production services
The Supply Chain
YOU
Raw
Procurement Production Wholesaler Retailer Customer
material Trims+
producer rest

Material management Physical distribution

Logistic management

Logistic management: the control of the supply


chain without owning it
2.3. Sourcing Strategy: How?
LC procedure in buying and selling

v LC at sight
v LC 30 days
v LC 60 days
v LC net
v LC back to back!!!!! Supply chain control requires
active banking system
2.4. Trend Info: be Informed
2.4. Trend Info: be Informed

• International Fairs
• International fabric fairs
• Suppliers: fabric manufacturers:
color cards
• Buyers: have info available on
trends/ colors and patterns
• Through Internet
• Design books
• Branch Magazines
• Cluster
• Agents
2.5. Trend Info- Fairs
2.6. Trend Info- Fairs
Fashion Forecast
2.7. Trend Info- Magazines-
Design
Date Modelname
Season Modelcode
Stylesheetno. Pattern PDNG 8212
Basic pattern
Client DYNAMIC

2.8 Product: Size charts+


tolerances
SIZES 128 140 152 164 176

Description REQ REQ REQ REQ REQ

1/2 CHEST 35,00 +1 37,00 +0.50 39,00 +1 41,00 +1 43,00 +1

1/2 WAIST 32,00 OK 34,00 OK 36,00 OK 38,00 OK 40,00 OK

1/2 BOTTOM HEM 35,50 +1 38,00 +1 40,50 +0.5 43,00 OK 45,50 OK

1/2 ARM HOLE 19,00 - 0.50 20,00 - 0.50 21,00 - 0.50 22,00 -1 23,00 - 0.50

SLEEVE LENGTH 46,00 +0.50 49,00 +0.50 52,00 +1 55,00 +1 58,00 +0.50

1/2 CUFF OPENNING 10,00 OK 10,50 OK 11,00 -0,50 11,50 - 0.50 12,00 - 0.50

CENTER BACK LENGTH 46,00 +1 48,00 + 1.50 50,00 +1 52,00 + 1.50 54,00 +1
2.8. Product Specifications
Size Charts

Size table for women's outerwear


(body sizes) in cm
character sizes •XS •S •M •L •XL •XXL
•figure sizes •34 •36 •38 •40 •42 •44 •46 •48 •50

•chest width •80 •84 •88 •92 •96 •100 •104 •110 •116
•waist size •61 •64 •68 •72 •76 •81 •86 •91 •97
•hip girth •86 •90 •94 •98 •102 •106 •110 •114 •118
2.8. Product Specifications
Size Charts

Size table for men's outerwear


(body sizes) in cm,
except trousers/jeans
character sizes •XS •S •M •L •XL •XXL
•figure sizes •42 •44 •46 •48 •50 •52 •54 •56 •58 •60
•chest width •84 •88 •92 •96 •100 •104 •108 •112 •116 •120
2.8. Product Specifications
Size Charts

Size table for men's trousers (garment sizes) in cm:


figure sizes •40 •41 •42 •43 •44 •45 •46 •47 •48 •49
•waistband •68 •68 •72 •72 •76 •76 • 80 •80 •84 •84
width
•side length •100 •108 •102 •110 •104 •111 •104 •112 •106 •112

figure sizes •50 •51 •52 •53 •54 •55 •56 •58 •60 •62
•waistband •88 •88 •92 •92 •97 •97 •102 •108 •114 •120
width
•side length •106 •113 •108 •114 •108 •114 •111 •111 •111 •111
2.9. Product Specifications
Visualize total offer- Correspondence
2.9. Product Specifications
Visualize total offer- Correspondence
Target the EU countries

Right Product
Right Price
Right distribution channel
Right country & segment
Right sample color
Right fabric
Right flexibility- minimum
Right lead time
Right service
Right communication