Capture licensing

After watching all those Barney comforters and Star Wars pillow shams gather dust on your store shelves a few years ago, you may have vowed to never again stock licensed home fashions merchandise linked with the release of a children’s movie.

Daniel Hammer, Sr. VP, Dan River's Home Fashions for Kids.

While we can certainly empathize with your plight – no one enjoys seeing licensed merchandise relegated to the clearance table – we think it would be a mistake to shun those items entirely.

Licensed merchandise, even that which is available for just a short time following the release of a movie, can greatly enhance your overall business and help make your store a destination for parents who are redecorating a child’s room.

The key, in our opinion, is to have realistic expectations. Typically, merchandise linked with the release of a movie has a relatively short shelf life, so it makes sense to have everything on display a short time before the release date. Then, it can be promoted heavily while the movie is in theaters.

Once the movie has left town and the studio’s television advertising is cut back, demand can drop significantly. Therefore, we advise positioning yourself to be able to get out of the licensed merchandise as quickly as you got into it.

Yes, there is a slight chance a few of your customers won’t get to your store before your run out of stock, but we believe there’s a bigger risk in being saddled with lots of slow-moving inventory.

We suggest displaying such merchandise in temporary, end-of-aisle racks that are highly visible in the store. That way, the consumer has easy access to the products – these can be great “impulse purchases” – but they don’t take up valuable permanent shelf space occupied by your core home fashions products.

These core product lines can include proven long-term winners such as Barbie and Looney Tunes licensed goods, as well as an array of non-licensed home fashions for kids. But in our view, merchandise from the latest “hot” movie should never replace these lines.

Several children’s television favorites, including Scooby Doo, Powerpuff Girls and Spiderman, are scheduled to debut on the big screen during the second and third quarters of 2011. Plus, a sequel to Stuart Little is slated for release next year, as well as yet another Star Wars film.

So there should be a host of opportunities for retailers to sell licensed merchandise – even if the popularity of a particular film wanes after a short time. Just be prepared to move quickly into merchandise tied to a different movie.