Sir Isaac

For every action, there is an equal and opposite reaction.
Feeling Newtonian this morning.
(third law of motion,  for you physics nerds.)

If you want to change the outcome,  change the inputs. 
If you change the inventory levels  sales will change.  Be sure the outcome is what you want.   If it isn’t,  there are other inputs you may not be factoring.  Traffic,  price,  selling,  conversion rates,  friendliness of staff?  All variables.
If you add time to your workout,  your results will change.  Phase 3, added in   another 15 min a day.  Wearing me out.. But results better be better.

-That Planning Guy

What’s YOUR Excuse???

This morning at the gym, while I was doing elliptical as I often do, there was a lady on the rowing machine.  She had a prosthetic leg, so she was rowing with 1 leg in the strap/slide thing, and the other on the floor.   I would guess she was 30-ish, though my women-age-guessing is truly awful, so likely between 25 and 45.  She was very fit, workout gear, looked pretty hardcore.  But what stuck me is that she likely could not do other machines, running, elliptical, stair master, etc as they are so leg-centric.  So she was rowing.
Now, I didn’t talk to her, don’t know anything about her, don’t know her story or even her name.  Just seeing her on a workout machine for about 40 minutes put the thought in my head about what excuses we all use every day for whatever we can not do, achieve, accomplish.
(If you are reading this expecting inspiring things, please don’t confuse me for Ghandi- I am taller. You should go read Nelson Mandela, MLK, The Dali Lama, not That Planning Guy. I am just a guy with an opinion)
The Merch Planning system we use does not suit what we need.  Yeah, I said it.  We stopped using it, and have gone offline into Excel sheets of varying difficulty and complexity.  Some are simple 5-line OTB (BOP-Sales-MD+Rec=EOP) Some are incredibly complex using formulas that combine a ISERROR() with IF()  with GetPIvot”” – and external references, and of course build in a forward-forecast engine that re-projects and re-trends.
I would rather we had a system that did this for us, and all levels & sheets rolled up, allocate down,  forward forecast, re-project, auto calc, and we could plan at Div/Dept/Class/Vendor/Location/Region interchangeably and all at once.  But we don’t have it, so should we do a bad job of giving the actionable data to the users? (in this case, Buyers/DMM)
Not having a tool is not a reason to not do a job.  The 19th century Pioneers built houses from trees without a Makita cordless drill/driver, or without a Sawzall. Not even a Poulan chainsaw!   Couldn’t even swing by the Home Depot for a box of nails. (you can do it! We can help! Not so much in 1850) Was it hard? I would assume so. But option 2 of living outdoors was pretty bad as well. Rain, cold, and a chance of being eaten by bears would make me build fast.

We (my company) are actively seeking out and doing due diligence for several planning systems.  JustEnough, ANT, TXT, Logility-we will research and review them, and one will be implemented this year (I hope)
Can we make excuses why we cant do? Sure.  And no one would really question it much.  We could say “We’ll do after we get tools” and that would likely fly.
I bet the lady at the gym could not work out and no one would lose respect- After all, it has to be difficult to do.  Wouldn’t blame someone for not working out at 6:30 AM, least of all a lady with a prosthetic leg.

“I never saw a wild thing sorry for itself. A small bird will drop frozen dead from a bough without ever having felt sorry for itself.”  -D.H.Lawrence

So whats your excuse why you cant get something done? Too busy?  Too Tired? Too short of a deadline? Not enough tools?  Sorry, I am throwing the BS flag on that one.

Not sure which quote to end with- Nike Just DO IT? I prefer Larry the Cable Guy- GET ER DONE.

After you achieve what cant be done, then you can go back and complain about it.

-THAT Planning Guy

PS- The pioneers probably didn’t whine about stress or workloads either.  Can you imagine? Sitting around with the other Pioneer guys, all in flannel, cold, windy, eating jerked meat. “Oh I am so stressed about the harvest, I just don’t know how I will ever harvest all the crops in order to feed my family.  Its just too much work” Huh?


Time to do what YOU want to do

Recently a friend asked me how I find the time to write my posts, go to the gym, work a lot, and everything else in my life.
As I am THAT Planning guy— lets do the math!

168 hours in the week:
49 hours are spent asleep (I sleep about 7 hours a night)
45 hours a week average at work, with 5 hours commute (about 1/2 hour each way)
I spend 1 hour a day at the gym, 5 hours a week.
I like to play golf both weekend days, 10 hours
Eating? about 10 hours a week
For us, family time is watching TV or movies, near 3 hours a day, 20 hours.
Even adding in 30 min a day for shower and brushing teeth, getting dressed, etc, 7 hours.

That leaves 17 hours- or nearly 2 1/2  hours a day to do what YOU find important.  For me it is writing, reading, thinking.  Or close my eyes and do nothing.  Maybe a short run. Maybe the shooting range.
Where does YOUR 2 hours go- is it productive? Is it leading you towards a goal?  Every minute, every hour, every day should have a purpose.

Last, shout out to a dear friend who left a company after nearly 20 years. I have known you for most of them, and so excited that you are with a company I have known for more like 20 weeks, but a great group all the same.  Congrats on starting a new chapter of your life!

-That Planning Guy



Smart vs Wise

A smart man learns from his mistakes.
A wise man learns from other people’s mistakes.
Which one are YOU?

If you are just starting out in your career,  the best thing you can do is find a great mentor.  Someone who has walked  a mile in your moccasins.  Been there,  done that,  planned the t-shirt buy. 
If you are later in your career BE that mentor.   Give back. 

Someone,  likely many,  helped get you where you are,  return that favor.
Karma is replenishable.   Build yours. 

-That Planning Guy

Great week

Awesome week for That Planning Guy — and its still only Wednesday.
Tuesday attending the Platt Retail Institute Analytics event was great.  SO many smart people in one event.  Learned a lot of fun things about signage and a different perception of what a ‘sign’ can do.  Then a visit to the Murtec conference, and some time in Restaurant Tech- great to hear innovations in other industries.
Dinner @ Olives Tuesday with a great crew, and dinner at Lago tonight with same crew, but expanded.  Met some smart restaurant people doing some really interesting IT/tech things.  Still curious who if anyone is doing any pricing analytics? Love to hear about that.

Rest of week could be even more telling as this journey continues. A few phone calls and a few email conversations still to have.

Come gather ’round people
Wherever you roam
And admit that the waters
Around you have grown
And accept it that soon
You’ll be drenched to the bone
If your time to you
Is worth savin’
Then you better start swimmin’
Or you’ll sink like a stone
For the times they are a-changin’
-Bob Dylan.

-That Planning Guy


Digital Retail Forum

Attending a great event today,  presented by Platt Retail Institute. 
A lot of talk about how consumers are being engaged,  and how to we do even better.  
How do we measure tears? Emotional responses to IoT,  interactions. 
More to follow.
-That Planning Guy,  on location!

ROI- Retail Orphan Initiative

I took part in the ROI event this year in NY at the NRF conference.  I can only say that I was truly proud to be a part of the great day for the great cause.

I ran across this in RIS this week: RIS ROI Article

All I can say is THANK YOU to Darren Singer and Shopko Stores for showing what caring looks like.

As SVP of Retail Health & Wellness for Shopko Stores, my mission is to improve the quality of life for the patients and families in the communities we serve. Joining the Retail Orphan Initiative and my compatriots in our industry in this righteous cause of caring for orphans and foster kids is aligned to this goal. This cause resonates with me as a father and a citizen of the world. I hope it does you as well.

For this reason, I am issuing a donation challenge to like-minded retailers and partners to join RetailROI make a difference. I have donated $1,000 and challenge my friends and colleagues in the industry to donate as well. $1,000 to RetailROI this month means 50 special needs orphans can move from an impersonal orphanage into a loving foster home.

Whether you are participating in March Gladness or simply want to make a donation, I urge you to get involved. You can donate here. 100% of the money raised after payment fees goes to help these children. Will you please join me?

Together we can make a HUGE Difference.

Darren Singer
SVP Retail Health and Wellness
Shopko Stores

The Retail Orphan Initiative is grassroots charity made up of retailers, vendors and partners in the Retail/Hospitality Industry to leverage our skills, networks and companies to make a real difference for orphans and vulnerable children in the US and around the world. Inspired by the work of the late Paul Singer (CIO of Target and SuperValu), RetailROI has helped over 180,000 children with clean water, schools, computer labs and business training in the last seven years. Please get involved. More information is available


Demand Forecasting and Weight Loss

Asked: “Can you project jacket orders for this fall/winter”? SURE, says That Planning Guy. Innocuous enough request, right? We all know from Replenishment 101 (click here) that Need = Demand () – OH – OO.  We have no on order, as we are well in pre-season.  We do have carryover product, so we just need to know demand, right?  We have years of history, myriads of like-items, plenty of data points to draw conclusions from.  OK, #datanerds:  GO!

Slight detour in the story, but I swear it will come back around…I am actively working on losing weight.  Trying to be ‘That Skinny Planning Guy’, yeah right.  I go to the gym every day, I monitor what I eat fanatically, and I understand the very simple math of calories in – calories out = calories deficit; 3500 calorie deficit= 1 lb lost fat! WOO! Easy!  Simply burn more than you consume, and every 3500 deficit, the scale rewards you. What can be easier? So— if I eat 2000 calories and burn 3000 calories every day, I should lose 1 pound every 3.5 days, or 2 lbs a week.  Just like clockwork.  Right?
First, let’s validate the dataset.  Calories in. For lunch I had a sandwich which said 400 calories on the label, and a salad which I estimated about 300.  But is 700 EXACT???? Not even close.  The 400 calorie sandwich had no mayo . I took the cheese off.  I added mustard.   I am not weighing a salad. I have no idea exactly to the gram how much dressing. So 700 is an estimate- at best.  My apple has 80 calories.   Do I have to eat all of it? Core and all? I am not a horse! What if it’s a really big apple???  The right side, calories out, is even more vague.  I went to the gym.  Regular readers won’t be surprised that I have a heart rate monitor and an app on the phone that tracks calories EXACTLY (#gymnerd) with an  EKG accurate HR monitor, age, weight, height, sex = calories burned.  Precise? I doubt it.  My resting (basal) metabolism burns 100 calories an hour- so says an article on Wikipedia, so that has to be right. At the gym I burned 500 calories in the hour. HARD work. Is that incremental? Or inclusive? And if incremental, is the 100/hour even close or just a big estimate again based on age, weight height, etc.
The point of all this is that none of this is an exact science.  But over an extended period of time, the math should be CLOSE. Will I lose EXACTLY 2 pounds this week? Doubt it.  Will I lose 20 over 10 weeks if I keep this up diligently? VERY likely. Time makes fluctuations over a curve smoother.

What does that have to do with a jacket projection?  Short term precision is nearly impossible, but being right over the time period is what matters most.
We need to have jackets on the floor when it gets colder.  It’s March now, so predicting when the weather in Vegas will get cooler is easy. Should occur sometime between late August and ‘it won’t get cold at all this year’. We had a 45 degree swing in daily high this week! If I could predict the weather with precision, you’d be reading ‘That Clairvoyant Guy’ website right now.  All I can tell is that it’s going to get hot, soon.

Factor #2- predict the weather for WHERE? We sell a good amount of jackets in February and March because it is cold where people are from, not necessarily here.  It is still snowing on some of you right now.  In Vegas, our customer base is truly the entire world- so predict the weather globally.

Factor #3- internal weather.  When it’s cold out or hot out, inside your glorious resort is perfectly comfortable.  People can come for a visit at several wonderful resorts and really never go outside at all.  Wake up to room service breakfast.  Go work out at gym. Have a Spa treatment, massage. Go have lunch.  Take in a little afternoon shopping, an afternoon nap.  Have an early supper and see an award-winning show.  Then do a little gaming after the show before heading to bed.  All that without ever leaving the building.  That’s a pretty perfect Vegas day! But, If 74 degrees is a little chilly for your tastes, you may need a sweater or a light coat- even though its July and 117 out.

Factor #4: Sizing.  Last year, we sold jackets in a perfect 1-2-2-2-1 bell curve, S-2XL.  But is that because that’s what we had on the floor?  If we had no mediums, that effects sales of L. So what we bought = what we sold.  Should we look at size sales for the first few weeks of selling? But was that indicative of the full season? Maybe we should follow S/O rate by style/color/size and of course by location, as the demographics in each location are so widely different.

Simple request, once you factor in global weather, internal thermostat strategy by resort, consumer demand, and the actual size of the potential customers.  And we didn’t even talk about color.

None of this is an exact science, but if we factor in all the ‘knowns’ and make educated, data-driven assumptions on the unknowns, time will smooth out the curve, and we will sell a lot of jackets.

-THAT Planning Guy


Pricing Elasticity 101

Price elasticity is a wonderful equation.  When you Google it, you get a lot of equations that look like this:

E_d = \frac{\frac{P_1 + P_2}{2}}{\frac{Q_{d_1} + Q_{d_2}}{2}}\times\frac{\Delta Q_d}{\Delta P} = \frac{P_1 + P_2}{Q_{d_1} + Q_{d_2}}\times\frac{\Delta Q_d}{\Delta P}

Isn’t that the writing they found at Roswell, New Mexico on the Alien ships? I am also fairly sure I went to a party during my younger days at a house that had many of those symbols over the door. But that’s a different story.

To be honest, I think that might be way over complicating the simple idea of elasticity.


So much easier to think of it this way— if you think of elasticity in between these 2  graphs, all pricing should fall in there somewhere.

The simple math is if the price increase and unit fall behave in lockstep (or worse, units fall disproportionately to the price change), that’s elastic.  If the the units fall less than the price increase, that’s inelastic.  And that’s where the money lies.

Identifying these items is often difficult, as some degree of what-if has to take place. But in a perfect scenario and all other factors being equal,  if you raise price and units don’t fall (inelastic) then you make more profit.   If you raise prices and the unit fall % is greater than the increase in profit kept, your elasticity was too high, and you lost money.

The math is easy; the execution is what is actually much harder.  Consumer behavior is a fickle science, and small ripples cans make large waves.  If the consumers feel the price is too high for the situation (whatever that may be) they will not shop.  This applies to a grocery store, a web site, any transaction-based environment.

My concern is if the unit loss leads to intangible losses: What are the ‘pull items’ from a basket analysis that also may fall, with the law of unintended consequences rearing its ugly head.  If you raise cigarettes, and you gain extra money but lose units, and the change proves to be inelastic, that’s great! Units fell 2%, and transactions fell 2% but revenue and profit up 5%.  BUT- before you pat yourself, what about the sales WITH the cigarettes- Lighters? Gum/mints? Any change to behavior in these? Whats the avg UPT of a transaction involving the item. If the add-on item is not impacted greatly, or the net is still positive, that’s a winner.  The point is to look outside the box to be sure you are right and not just do analysis in a vacuum.   If the results of the total store, and the total transactions, and the total profit is increased, then the move was genius. Someone once said “Analytics Drives Business.” Enjoy the fruits of this! And then find the next inelastic item to glean profit from.  They are out there, filling your shelves, your website, your stock rooms.
Too low, too high, Goldilocks pricing?

Retail is an imperfect circle. Remember your 3 R’s- Right product, Right time, Right price- and all 3 factors are critical.  A great product late is no better than a bad product, and a incorrectly priced item negates the first 2 every time.

-THAT Planning Guy



Monday Morning

What does that conjure up in your head? Dread?  Oh God another Monday… What will be waiting for me today….
WRONG. A whole new set of data to tear into.  Truths to be uncovered.   Answers to be revealed,  and business to be driven. 
Anyone can fix a problem in hindsight.  What separates the winners from the losers is fixing it in real time, or near real time.

Identify. Analyze.  React.  Repeat.

I challenge all my Data Nerd brethren to BRING IT on a Monday. 


-THAT Planning Guy