ABSTRACT
The entry focuses on merchandise replenishment and budgeting. It explains the role of Gross Margin Return on Investment (GMROI) in merchandising decision‐making. This metric is important for trading partners in the retail supply chain to understand, particularly manufacturers and other service providers to the chains. It guides the trade‐offs involved in merchandise replenishment between profits and inventory investment. The entry contains instructions on calculating GMROI and using it to prepare a merchandise budget. Included is a chart of GMROI returns for various merchandise types.
