DECA Retail Merchandising Practice Exam

Question: 1 / 400

What is the outcome of poor merchandise planning?

Increased customer loyalty

Unsold inventory and financial losses

Poor merchandise planning leads to unsold inventory and financial losses, which is the outcome identified in this scenario. When a retailer fails to effectively plan their merchandise, it often results in overstocking items that do not sell, leading to excess inventory. This unsold stock ties up capital that could have been used more effectively elsewhere in the business. Additionally, holding onto outdated or non-moving merchandise can reduce cash flow and contribute to markdowns, further impacting overall profitability.

In contrast, good merchandise planning aims to align inventory levels with customer demand, which enhances sales opportunities and minimizes financial setbacks. Thus, focusing on effective merchandise planning is crucial for maintaining a healthy balance of stock, maximizing profitability, and minimizing losses.

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Improved store reputation

Better employee performance

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