An approach to standardise the Merchandising process of an Online Apparel Brand

68 Pages·2015·1.33 MB·English

AN APPROACH TO STANDARDISE THE
MERCHANDISING PROCESS OF AN
ONLINE APPAREL BRAND

A dissertation submitted in partial fulfilment of
the requirement for the award of Degree in
Bachelor of Fashion Technology
(Apparel Production)

Submitted By
PUSKAR KUMAR SINGH
(B.F.Tech 2011-15)

Under the Guidance of
RANJAN KUMAR SAHA
Associate Professor

Department of Fashion Technology
National Institute of Fashion Technology, Mumbai
MAY, 2015
ABSTRACT

The Indian online apparel market has become more competitive these days and the
competition is getting more and tougher with every single day passing.
This project is designed to understand the merchandising process of an online
apparel brand and suggest ways to standardise it so that the problems like
merchandise stock outs and late response time, and eventually, the percentage of
order cancellations and return to origin (RTO) orders can be minimised.
The objective of this project is to understand the root causes of merchandise stock
outs and to suggest measures to avoid such situations and standardise the
processes in order to eliminate or minimise such situations. A detailed study of the
entire process and work flow has been done and data at every step has been
analysed to find out the root cause of the stock outs and the same was rectified
using various tools and techniques like optimizing the process at every stage and
removing non-valuable added activities and utilizing the available resources
effectively and efficiently.

Keywords: Merchandising, online brand, sales forecasting, inventory management.
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CERTIFICATE

This is to certify that this Project Report titled “AN APPROACH TO STANDARDISE
THE MERCHANDISING PROCESS OF AN ONLINE APPAREL BRAND” is based
on my, Puskar Kumar Singh’s original research work, conducted under the
guidance of Mr. Ranjan Kumar Saha towards partial fulfilment of the requirement for
award of the Bachelor’s Degree in Fashion Technology (Apparel Production), of the
National Institute of Fashion Technology, Mumbai.

No part of this work has been copied from any other source. Material, wherever
borrowed has been duly acknowledged.

Signature
Puskar Kumar Singh

Signature

Mr. Ranjan Kumar Saha (Faculty Mentor)
ii
ACKNOWLEDGEMENTS

I wish to express my gratitude to everybody who has assisted in learning processes
during this graduation project.
I wish to thank Bewakoof Brands Pvt. Ltd., Ghatkopar, Mumbai for providing me a
great opportunity to do my graduation project with them. I would like to thank Mr.
Sumit Kumar, Merchandiser, Bewakoof Brands Pvt. Ltd. for guiding me in the course
of this project.
Also, I wish to thank Mr. Siddharth Munot, founder of Bewakoof.com, for his
immense support and motivation throughout my graduation project.
I would like to thank my faculty mentor Mr. Ranjan Kumar Saha, Associate
Professor, Centre Co-ordinator, Department of Fashion Technology, Mumbai for his
expert guidance during the project.
I wish to thank Ms. Nilima Rani Singh, Director, NIFT, Mumbai for providing me with
resources I needed to finish my graduation project.
I would like to thank Mr. Anurag Ranjan (Merchandiser, Bewakoof.com), Mr. Ayush
Chandak (Merchandiser, Bewakoof.com), Mr. Amber Mani (Sampling Manager,
Bewakoof.com), Mr. Vivek Yadav (Operations, Bewakoof.com), Mr. Gourav Agarwal
(Operations, Bewakoof.com), Mr. Savio (Manager, Logistics and Customer Care)
and Mr. Altamash Siddiqui (Manager, Logistics and Customer Care) for their help
and support in my project.
I would like to thank all the faculties and staff of Department of Fashion Technology,
NIFT Mumbai for their support and guidance.
Lastly, I would like to thank my family for encouraging me at every step.

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INDEX

ABSTRACT…………………………………………………………………………………(i)
CERTIFICATE……………………………………………………………………………..(ii)
ACKNOWLEDGEMENTS……………………………………………………………….(iii)
1 Introduction……………………………………………………………………………..1
1.1 Project…………………………………………………………………………..2
1.1.1 Background…………………………………………………………2
1.1.2 Problem Statement………………………………………………...2
1.1.3 Objectives……………………………………………………………3
2 Literature Review……………………………………………………………………..4
2.1 E-commerce…………………………………………………………………….5
2.1.1 E-commerce Models……………………………………………….5
2.1.2 Advantages and Disadvantages of E-commerce………………..6
2.1.3 E-commerce in India………………………………………………...7
2.1.4 Online Apparel Brands in India…………………………………….7
2.2 Merchandising…………………………………………………………………10
2.2.1 Need of Merchandising……………………………………………10
2.2.2 Role of a Merchandiser……………………………………………11
2.2.3 Major Documents created by Merchandiser…………………….17
2.2.4 Time and Action Calendar………………………………………...18
2.3 Fashion Forecasting…………………………………………………………..20
2.4 Case Study: Zara’s Agile Supply Chain……………………………………..21
2.4.1 Product Organisation and Design………………………………..21
2.4.2 Procurement………………………………………………………..22
2.4.3 Production…………………………………………………………..23
2.4.4 Product Distribution……………………………………………......23
2.4.5 Sales and Feedback……………………………………………….24
3 Research Methodology………………………………………………………………..26
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4 Data Collection and Analysis……………………………………………………….28
4.1 Primary Data Collection……………………………………………………..29
4.2 Primary Data Analysis……………………………………………………….30
4.2.1 Purchase Order Data Analysis……………………………………30
4.2.2 Sales Data Analysis………………………………………………..32
4.2.3 Shipping Data Analysis…………………………………………….33
5 Solutions and Implementations……………………………………………………..37
5.1 Planning………………………………………………………………………..38
5.2 Trims Management……………………………………………………………40
5.3 Print Planning…………………………………………………………………..47
6 Results……………………………………………………………………………………50
6.1 Purchase Order Data Analysis……………………………………………….51
6.2 Sales Data Analysis…………………………………………………………...53
6.3 Shipping Data Analysis……………………………………………………….54
7 Conclusion………………………………………………………………………………55
8 Bibliography…………………………………………………………………………….57
8 References………………………………………………………………………………58
9 Annexures……………………………………………………………………………….60

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LIST OF FIGURES

Fig. 2.1 Types of Merchandisers………………………………………………………..12
Fig. 4.1 Difference Between Actual Due Dates and Delivery Dates of Purchase
Orders in the Month of January 2015…………………………………………………..30
Fig. 4.2 Difference Between Actual Due Dates and Delivery Dates of Purchase
Orders in the Month of February 2015…………………………………………………..31
Fig. 4.3 Reasons for Order Cancellations……………………………………………….33
Fig. 4.4 Orders Despatched in January 2015…………………………………………..34
Fig. 4.5 Orders Despatched in February 2015………………………………………….35
Fig. 5.1 Data Sheet for Buffer Stock……………………………………………………..40
Fig. 5.2 E-Mail to the Merchandisers…………………………………………………….41
Fig. 5.3 Trim Data Sheet…………………………………………………………………..45
Fig. 5.4 Sales Data Sheet…………………………………………………………………48
Fig. 5.5 Inventory Data Sheet…………………………………………………………….49
Fig. 5.6 Plan Sheet………………………………………………………………………...49
Fig. 6.1 Difference Between Actual Due Dates and Delivery Dates of Purchase
Orders in the Month of March 2015……………………………………………………...51
Fig. 6.2 Difference Between Actual Due Dates and Delivery Dates of Purchase
Orders in the Month of April 2015………………………………………………………..52
Fig. 6.3 Orders Despatched in March 2015……………………………………………..54

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CHAPTER 1:
INTRODUCTION

1
1.1 PROJECT

1.1.1 Background:
There is a boom in India‟s economy with e-commerce continuing to increase its
share in the market. With the increasing availability of internet services through
various platforms, the e-commerce sector in India has a very good potential in the
near future.
In 2013, the e-retail market in India was worth US$ 2.3 billion. India has close to 10
million online shoppers and is growing at an estimated compound annual growth rate
of 30% whereas the global growth rate is 8–10%. (Shrivastava 2006) Electronics and
Apparel are the biggest categories in terms of sales. According to Forrester, the e-
commerce market in India is set to grow the fastest within the Asia-Pacific Region at
a CAGR of over 57% between 2012–16. (Wigder 2011)
In the last decade, the competition on the internet increased manifolds. Large
players have come into the booming Indian e-commerce platform. Flipkart,
Amazon.com, Snapdeal, Jabong etc. are the key players and trend-setters for the
various start-ups. As the competition has now become very stiff, the companies are
struggling for more and more agility and speed in procurement and delivery.
With the advancements in communication and information technology, companies,
now, are able to keep low inventories, still catering very smoothly. Low inventory
levels help in reduction of costs of inventory and also, lower capital investment on
stake. In order to keep low inventory, the replenishment cycles need to be short and
frequent. The lower the replenishment cycles, the lower would be the level of
inventory.
1.1.2 Problem Statement:
In an ever-increasing competition in the e-commerce apparel market, companies are
struggling to keep the inventory levels low to lower the inventory costs and
investment on goods, still catering the orders on time. At bewakoof.com, the
company keeps the inventories as low as possible with the help of just 3 week

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