LF 805 CLASS-4. .New Product Development

Graduate Diploma
Leather and Footwear Management

Spring 2022
Skills for Employment Investment Program (SEIP)

Executive Development Center (EDC)
East West University
LF 805
Merchandising and Supply Chain Management
New Product Development
Skills for Employment Investment Program (SEIP)

Executive Development Center (EDC)
East West University
Shoe line Development TARGET PRICE TK.990.00
TARGET COST PRICE TK.330.00
BRAND NAME IPANIMA
PROJECT NAME SUSMITA
SUB CATEGORY LADIES SANDAL
UPPER MATERIALS LEATHER
LINING MATERIALS BEIGE PU

SOCKS MATERIALS BEIGE PU
FOOTBED BLACK EVA
OUTSOLE BLACK PVC
FINAL SAMPLE ETD FEB,2022
PRODUCTION MONTH MARCH 2022

GM%, MOQ, Source, Promotion, Stores REMARKS OWN FACTORY
“A shoe has so much more to offer
then just to walk !”..Christian Louboutin
MERCHANDISE MANAGEMENT
Price Points Analysis
 The first step consists of defining all the price points which are
foresee/danger for all the categories pertaining/relating to the same
product group (men, ladies, children, etc)
 For each category, the number of lines and quantity planned to be
bought per price point is considered.
 Obviously, the number of pairs to be bought per category and its
corresponding value must be with respect to the Open-to-buy plan.
 The following is an example of a worksheet which each individual buyer
can use to help in his/her planning.
 Examle of Price Points (PPs) are as follow:
TK.550, TK,590, TK.650, TK. 690 or TK.599, TK.699, TK.799, TK.899 Etc
Merchandise Management
Price Points Analysis
30% 26% 25000000

Contribution %
25% 20000000
20% 18%
16% 16% 15000000
14%
15%
10% 10000000
10%
5% 5000000
0% 0
350 390 450 490 550 590
Pairs Turnover
Findings:
1.Which Price Points contribute more and more
2.Which price points are missing
3.Any overlapping Price Points
4.Must follow Price Points discipline like TK.550, TK.590, TK.650 but not like Tk.540,
TK.644 etc!!!
Shoe Line Building
 A key part of the shoe line building process is the planning of the
Core and Additional Collection in terms of price points, number of
lines and quantities per line / price points.
 The Core collection is the part of the shoe line which is given to ALL
stores in order to fulfill basic target customers requirements and
project an overall same company image.
 The Additional collections are developed to satisfy specific stores

customers needs.
 At this point of the planning process, it is important that each buyer

establishes a frame work for their collection, which will be in synch
with the company marketing strategy and its budget plan.
Channels of SOURCING:
 When working with a factory we have three choices, each having advantages and disadvantages. The
difference is the relationship with the person we are working with and ultimately the factory.
1. Direct/Own Factory: Working with a factory directly has advantages in that you are able
to influence the design and quality by direct visits to the factory and
working closely with the designers.
2. Indirect/Local Suppliers: This indicates a route to a supplier through a third party, or

independent agent who may be working for one or more factories.
Generally, this sales person has a specific or limited collection
depending on the number of factories he works for.
3. International Suppliers: These sales people often have a wider collection form a variety of
factories from different parts of the world and at varying price levels for
similar articles.
These people often work with factories who have their own product
development an design teams and can offer new fashions but this may also add
to the costs.
 In most cases, a combination of all three may be useful to have the best collection and product mix.
Country’s Factors for Importing or Sourcing
Sourcing from Importers
For imports, the choice of country and which factory are important. Factors to consider are:
 Country political climate or stability, which may threaten the promised delivery, dates.
 Trade restrictions and possible new quotas and duties, which will affect the costing and
deliveries.
 Manufacturing skills and experience of a particular type of product.
 Lead times for ordering are important if you wish to reorder the article during the selling
season.
 There are various risks and costs to be considered such as labour, pricing, rates of exchange,
letters of credit requirements and the impact on cash flow.
 Under no circumstance must you deal with a factory that engage children in production.
The Sweetness of Low Price is Soon Forgotten
by the Bitter Taste of Poor Quality
Product Sourcing
Desirability Factors for Products Sourcing
The importance of sourcing the product has been contained eight key points. Each
point was defined in detailed and the benefits from each point made very clear. This
presentation contained the following points:
1.Product Comfort
2.Product Quality
3.Fashion harmony
4.Latest/ First class design
5.Brand reputation/Position
6.On time delivery
7.Commitment
8.Production Capacity
 Efficient Personnel- NO child Labor

 Factory Image or Company Images
 Reputation for Good service to merchants

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Graduate Diploma

Leather and Footwear Management

Skills for Employment Investment Program (SEIP)

Merchandising and Supply Chain Management

New Product Development

Skills for Employment Investment Program (SEIP)

TARGET COST PRICE TK.330.00

BRAND NAME IPANIMA

PROJECT NAME SUSMITA

SUB CATEGORY LADIES SANDAL

UPPER MATERIALS LEATHER

LINING MATERIALS BEIGE PU

OUTSOLE BLACK PVC

FINAL SAMPLE ETD FEB,2022

PRODUCTION MONTH MARCH 2022

30% 26% 25000000

 The Additional collections are developed to satisfy specific stores

 At this point of the planning process, it is important that each buyer

2. Indirect/Local Suppliers: This indicates a route to a supplier through a third party, or

Sourcing from Importers

 Efficient Personnel- NO child Labor

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