Retail Merchandising The Definitive Guide Operations and Standards

Familiarize yourself with the current ownership and management. Look up, compare and analyze past audits so you can put the latest information into perspective. Look for trends, repeat unacceptables and location to district averages. If you have any notes or questions, compile them ahead of time. Retail audit software can help by allowing you to run reports to see location trends as well as have a store’s entire audit history ready for review.

If you use software, view your collaborative calendar to see to schedule audits, see where audits are in progress and where audits have yet to occur. Once you have a good base, you are ready to start incorporating more layers and techniques. Place displays in strategic hot spot areas such as the end of aisles, the POS, and to the right of the DZ. Look out for damaged displays with broken or missing pieces, burnt out lights, peeling stickers, faded signs or fraying flooring that could become a trip hazard. Designing your space to comply with the Americans with Disabilities Act (ADA) guidelines is a win-win.

  1. Scores are automatically calculated including the visit score and a score by section as the visit takes place.
  2. The basic rule is that the higher the price, the slower the rate of sale.
  3. Most grocery stores offer row after row of products you can buy, take home, and either enjoy the items as-is or create delicious dishes from the goods you purchased.

Analyze traffic flow and place displays where they will achieve maximum impact. Be aware of dead spots so that you can correct underserving areas. Last, ensure stores have a way to contact and follow-up to ask questions and report any issues. Having enough product on hand can ensure that supply meets demand.

An important consideration in merchandising businesses is that service-providing companies do not fall under this category. Unless the company offers products as part of the service, the service alone does not qualify a business as a merchandising one. Unless a barbershop sells hair products, barbering services alone cannot make the barbershop a merchandising business.

After 90 days, a retailer needs to get rid of their merchandise. Because seasons are three months long and consumption habits for specialty items follow seasonal trends. This may change if you’re a big, high-volume store that needs only about two weeks worth of merchandise at any given time.

Examples of such businesses are grocery stores, drug stores, and clothing stores. The important factor to note is that all retail businesses buy their products from wholesalers or manufacturers and sell them to end consumers. Companies who provide services are not considered merchandising businesses, unless they offer merchandise as part of their service. For instance, if you go to a tanning salon, the tanning session is considered a service. However, if the salon offers tanning lotions, creams, and tanning enhancers, it could be considered a merchandising business because it has products available for you to purchase. Product merchandising refers to the advertising activities used to sell a product.

Assign points and, if you are using software, make use of a “Critical” flag accordingly. A “Critical” item sets the value of the entire section to zero, regardless of other items, if found non-compliant during the visit. With software, you don’t need to worry about keeping track of the total score. Scores are automatically 6 rights of merchandising calculated including the visit score and a score by section as the visit takes place. While it is easy to think of everything as important, some items are often more important than others, even critical to the continued success of the business. Seasonal merchandising and CPG-paid bulk floor displays come to mind.

Also, consider adopting Bindy; 92% of our customers report improved execution of merchandising programs. When employees are rude, sarcastic or not knowledgeable, no matter how great your store looks, your sales will be negatively impacted. After two bad experiences, 42% of customers will stop shopping with a brand. Observe during your audit and conduct regular touch points with your team to ensure service standards are being met. The frequency of merchandiser store visits (at least visits involving the merchandising checklist) will vary from one organization to the next. On one end of the spectrum, some organizations conduct as many as one visit per week.

As with any specific departmental audit program (merchandising, loss prevention, health, and safety), general operational factors such as cleanliness, orderliness and safety should be in view. While your district managers, sales reps or other resources are in the store, have them conduct one or more audits on broad operational factors such as general cleanliness or safety and security. It does not have to take a lot of time and paints a more complete picture that gives some context to your merchandising program. If it takes one paragraph to define the standard, use one paragraph. Attach a best practice photo to an item to illustrate the standard; 40% of people respond better to visual information, and visual information can increase understanding by up to 400%!

Traffic flow issues

Likewise, certain promotional signage may not apply to all retail banners in a merchandiser’s territory. At the core of any successful audit program is a checklist covering key compliance areas. Below we detail best practices to consider for building a merchandising audit checklist and executing a merchandising audit program. Merchandising audits, also called Store Walks or Store Visits, drive higher compliance with brand standards at store level. They increase sales and profit margins, boost customer satisfaction and cut business risks. Merchandising can be defined as a business practice that involves marketing and selling products for individual customers to purchase in small quantities.

Merchandise Meaning

Merchandising businesses are companies that buy products and then resell them to end consumers, whether online or in brick-and-mortar stores. Merchandising businesses are specific to products rather than services. If a business only offers services, it does not qualify as a merchandising business.

Confusing displays

It is a business that purchases finished products and resells them to consumers. Think of the last time you went shopping for food, household items, or personal supplies. That store had purchased the items wholesale from a distributor or a manufacturer and made it available to you.

Leaving some room allows customers to slow down and appreciate your offerings, and it makes your space look like it was thoughtfully laid out and curated. Customers can become uncomfortable when others bump into them or when they bump into other displays while they are browsing. They may even move away from merchandise that interests them just to avoid feeling confined and crowded. Ensure shoppers can move freely between displays and through aisles.

The location of the product is of prime importance since it decides the accessibility to the customer. For example you would expect to see a ‘sale’ product on a trestle table near the front entrance; whereas you might see a new range displayed on a mannequin with accessories close by. Refer to the Merchandising category for checklists, how-tos and best practices for merchandising. Rework confusing displays so the customer can easily read signage and absorb the display’s purpose without difficulty.

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Finding the right price point can spell the difference between making a profit on an item or taking a loss. One of the easiest ways to seat a price is to employ a cost-plus pricing strategy. Under this arrangement, the merchandiser considers her cost for the item and then adds a profit margin or mark https://1investing.in/ up to determine the selling price. Variations of this strategy can also include fixed and variable costs with some flexibility to adjust pricing if demand is not strong enough to support a higher, initial price. Merchandisers need to have a place to put their items on display for consumer review.

Every store needs these products, even if customers don’t always buy them, because they “wow” customers. Pricing plays a big part in merchandising, but there aren’t set formulas. The basic rule is that the higher the price, the slower the rate of sale. However, this rule may not be true for your store, and you need to experiment to find out what pricing rules apply. Finally, whether you are a large retailer or a small to medium business, don’t let a customer who is checking out get a bad impression from a messy cash wrap. Ensure staff do not leave food, drinks or personal items in view, and any non-applicable paperwork is out of sight.

So “the right time” for a product can mean when it’s introduced, put on sale, or even closed out. “The right product” refers to selecting and offering profitable goods the customers will appreciate. Having Visual Merchandising standards which allow the team in store to deliver a consistent visual message to the customer. For example, colour blocking of wall units, the use of gondolas, or handwritten versus printed ticketing. Having product at the ‘right price’ is a balance between making sure that it is high enough to make a profit and yet low enough to meet the competition and customers’ expectations. Similarly, damaged signage that’s torn, marked or worn makes you look unprofessional and should be taken out of the rotation.