Merchandising PGA 3.0 Level 2 Test Exam Q&A Latest Updated

Merchandising PGA 3.0 Level 2 Test Exam Q&A Latest Updated What does a typical OTB plan cover? - CORRECT ANSWER -it covers one year, and is broken down into 12 one -month segments for each merchandise category. What do OTB plans help merchandisers do? - CORRECT ANSWER -•Avoid over - or under -investing in inventory •Maintain inventory at levels that support forecasted sales •Avoid running out of individual products or merchandise categories Steps for OTB Plan Development - CORRECT ANSWER - 1. Forecasting Sales - CORRECT ANSWER -• Forecast annual merchandise sales, as described in the Business Planning course • Break down forecasted annual sales into merchandise classifications • Distribute annual sales into individual months by classification 2. Forecasting the Cost of Goods Sold: - CORRECT ANSWER -•Forecast the annual COGS, as described in the Business Planning course •Determine the COGS for each merchandise classification •Calculate total sales and the COGS as a percent of total sales •Calculate the monthly COGS by classification 3. Projecting Turnover - CORRECT ANSWER -•Project an annual turn rate for each merchandise classification and the entire inventory 4.Establishing Beginning -of-Month Inventory Levels: - CORRECT ANSWER -•Forecast average inventory levels for the entire inventory and for each classification •Adjust average inventory levels up or down to account for sales fluctuations throughout the year 5.Calculating Open -to-Buy Budgets: - CORRECT ANSWER -•Calculate OTB budgets at cost for each merchandise classification •Adjust budgets for each classification based on actual performance data