Presenting the case for closer relationships between Merchandising and IT teams in retail businesses

June 5, 2011 - PRLog -- Frances Thomas has worked both in Merchandising and IT in retail businesses.  She discusses what she has learnt from working on both sides of the fence and argues that closer cooperation results in better outcomes for the business as a whole.

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, that they are completely unaware of any areas of work to which they are not directly exposed on a day-to-day basis. Due to the wide array of departments that make up most retail businesses, there 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 IT solutions to provide flexible, responsive systems that supported fast delivery of product to market and provided product performance data in a timely fashion.

My merchandising background and my IT experience mean that I am in the unusual 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 fashion retailer Karen Millen’s merchandising team to its IT department, I was immediately struck by a difference in pace. 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 with the same sense of urgency and priority to truly work in partnership. The Merchandising teams can assist IT by explaining their priorities and giving context to the tasks that IT perform for them.

In contrast, IT is divided into several departments each of which works to different deadlines and pressures, but all impact the Merchandising team in some way. This diversity with the IT role is not always fully understood by 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 systems and IT services.

IT teams are involved in all aspects of the supply chain and of the wider business, resulting in an in-depth knowledge of 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 aids the Merchandising team when any system change requests are made and any systems’ training is required. However, it is important for Merchandisers to recognise the challenges that developments pose, alongside the opportunities they create. The highly-logical and process-driven nature of IT departments can be invaluable for Merchandisers when planning user groups, reviews and planning future best practice.

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 business and its key drivers is crucial in ensuring that IT developments support the growth of the company and its 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 this drives process.  They must also appreciate that this cyclical environment affects merchandising strategy and the way in which the team works, meaning that some of the demands it makes make on the IT department will be high priority, and require an immediate response.

Merchandising teams tend to be driven by departmental performance, sales and margin, and any IT applications need to facilitate easy visibility of this. The IT team is tasked with providing systems that cater to external customer expectations, such as purchasing through multiple 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 a retail business can be as a whole.

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Romain Consulting is a UK-based Marketing & Corporate Communications consultancy. Services including PR are delivered by a high-calibre, highly-experienced technology Marketer. Former Marketing Director of global group. Strategy, planning & execution. Full range of Communications & Product Marketing activities are available on a project or retained basis. Specialisms: technology, insurance & financial services, retail. French speaker.