As most grocery retailers are gearing towards increased sales through online stores or market places, merchandising teams need to address new challenges. From assortment selection to category roles and mix-margin, the main tasks Category Managers and Buyers must perform on a regular basis must be accelerated.
The addition of digital sales channel adds complexity, along with profitable growth opportunities and their share of risk. Reduced Teams and work-from-home constraints are raising the bar of the solutions to be found.
On what existing strengths can you build the next steps of your Merchandising Teams improvements?
Thank you for investing your time in assessing the Vendor’s Engagement effectiveness of your retail organisation . We have listed 10 simple question with a straightforward scoring. Each type of answer gives a number of points. The assessment and recommendations are right after the questionnaire.
Scoring
Yes = 2 No= 2 Don’t know = 0
Maximum Score: 20 points
Minimum Score: 20 points
Assessment Overview
More than 6 “No” answers
At this stage, merchandising activities in the organisation are probably driven by experience and instincts. It is also probable that vendors and their distributors play a leading role in the evolution of the categories in terms of Brands and Item selection. It is also probable that assortment certain categories are overcrowded with duplicate items, generating undesired performances such as:
- Long list of underperforming items by category
- Stock days that might not relate with the normal rotation of the category
- Disorganized shelves display with large collections of items
- Space allocation not supporting champions items with a high sales potential
The risks of maintaining such a situation are:
- Lower sales due to too many items
- Decreased margin due crowded storage with breakage and stock clearances required to lower stock level
- Decreased Cash flow due to purchase of too many items with low rotation
While considering your next steps on improving your merchandising activities, here are some priorities you might want to focus on first
- Setup a limit of number of items and Brands by Categories
- Setup quantified rules for listing a new item
- Setup quantified performances rules for delisting an item
Between 3 & 6 ”No” Answers
Healthy fundamentals have been already established for the merchandising activities. Some rules are already in place, and some of them might be running more efficiently than others. The merchandising organisation’s effectiveness – and its positive impact on Customers Satisfaction – would be greatly improved if the “missing rules” are setup.
- Dive into the causes of the “No” answer and ensure that the reasons you are given are going beyond assumption
- Try to quantify how much additional sales and margin gains a “yes” answer would deliver to the business
- Launch an internal project about “What are our options if we want to transform our No answers into Yes answers
Less than 3 “No” Answers
Congratulations! Your organisation has a professional and customer focused Merchandising team. Master. Have you already automatizing most of your merchandising tasks?
YES!
I am interested in having a more detailed – and free- diagnostic of my Merchandising organisation to identify what are the options available to grow our Commercial Offer’s attractiveness and profitability in the short term.
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