Unlocking the Power of NetSuite Merchandise Hierarchy for Optimal Catalogue Structuring

Introduction

From our experience working with companies in the Distribution, Retail and E-commerce industries, we know that they almost always measure sales margins, look at inventory levels or assign promotions per group of items belonging to a certain family or subfamily. Today, we invite you to discover a hidden gem within NetSuite—the Merchandise Hierarchy. This often-overlooked functionality allows you to create a structured tree within your item catalogue, enhancing reporting, analytics, boosting sales, optimizing stock levels, and seamlessly integrating with your e-commerce platform.

Activating Merchandise Hierarchy:

To begin, activate the Merchandise Hierarchy feature in NetSuite by navigating to setup - company - enable features - subtab “Items and Inventory.” Once enabled, a new menu will appear under setup, along with a dedicated subtab within the items section.

Setting Up the Hierarchy

Utilize the Hierarchy Manager to easily build a dynamic hierarchy. Create nodes and levels to categorize and assign items efficiently. Multiple hierarchy versions can be employed simultaneously, catering to your general item catalogue and specific transactions, such as sales or purchases.

Example Hierarchy Setup

Consider a scenario where you sell home cinema equipment. Your hierarchy might look like this:LevelNodesStoreMy home entertainment shopCompany/BrandSony, Samsung, LG, PhilipsProduct GroupTV, soundbar, accessoriesDepartment (for TV)LCD, LED, OLED, QLED, MiniledClass40-43”, 50-55”, 65”

Attributes and Item Level

Enhance the hierarchy further by adding attributes to items, such as color, material, size, or specific features like HDMI connectors, ambi-light, or refresh rate for TVs. Attributes describe the characteristics of your products across the Hierarchy, giving you greater flexibility to slice your workbooks and reports as needed, and no longer limiting you to your product classification by hierarchy nodes.

Dynamic Tree Structure

The Merchandise Hierarchy provides a dynamic, graphical representation of the tree structure. Explore levels, nodes, and connected items, allowing for easy navigation and management. When a node has no child connected, items can be added at that level.

Utilizing Hierarchy Information

Once set up, leverage the hierarchy's insights through reports and saved searches. Specific reports include Sales by Item, Purchase by Item, Current Inventory, and the SuiteAnalytics Merchandise Hierarchy Workbook.

Key Reports for Informed Decision-Making

• Sales by Item Report: identify top-selling products and areas for improvement within each hierarchy level.
• Purchase by Item Report: gain insights into purchasing patterns and make strategic decisions based on hierarchy data.
• Current Inventory Report: monitor stock levels, turnover rates, and overall merchandise hierarchy health.

Enhancing Saved Searches

Integrate the Merchandise Hierarchy into saved searches for promotions, price levels, and more, offering a comprehensive approach to utilizing this powerful functionality in NetSuite.

Conclusion

Unlock the full potential of your item catalogue with NetSuite's Merchandise Hierarchy. Streamline your operations, gain valuable insights, and elevate your e-commerce experience. Activate this feature today and witness the transformation in your business's efficiency and decision-making capabilities. Need help? Reach out to our Retail & eCommerce experts today.