How to Tell a Good Retail Story - (1) Commodity

How to Tell a Good Retail Story - (1) Commodity

The most important thing for convenience stores is "location location location", and "commodity power" is the most important thing.

Regarding the product structure of convenience stores, let's start with the category.

What is a category? Category refers to a group of products that can replace each other. In the minds of consumers, this group of commodities are interrelated or interchangeable to meet consumer needs.

Why should category management be done in a convenience store? It can be analyzed from two perspectives:

First, for consumers, it is easy to find and easy to buy.

Second, for channels, it is a process of comprehensive product management, manufacturer management, space utilization and logistics efficiency, and then through promotion to obtain maximum profits.

After clarifying the concept of "category", let's talk about the composition of each category.

1. How to choose products?

Regarding the category strategy, first of all, it must be selected from the three aspects of sales volume, sales amount, and gross profit. The purpose of the introduction of commodities is nothing more than to sell and increase gross profit. The second consideration is the drainage force, which is the so-called magnetic commodity. Next, other benefits will be considered, such as display fees, deployment fees, gross profit rebates, and even goods that can be refunded.

Generally speaking, the headquarters of convenience store companies regularly hold new product meetings, but each company has different considerations for introducing new products and selecting products, and the priority of consideration methods will also be adjusted.

Some will give priority to supplementing the price band (high, medium, low), some will consider the specifications of the product (family, personal, etc.), and some will consider the manufacturer's brand (first-line brand, new brand, Internet celebrity). Some will consider sales promotion planning and resources, and some will bid on competing stores (do a product matrix analysis).

2. Who will decide the outcome?

The product is selected and it is also on the shelves, then what? This is the key step for consumers to decide whether they are superior or inferior.

For new products, in a system with a strong headquarters style or franchise system, stores must cooperate with new products on the shelves, so that the market determines the success or failure of new products, not the store manager. If it’s up to the store manager, maybe many new products are just like sprouting seeds that die before they grow up.

As for how long is the new product evaluation period? Short-term guarantee products are basically observed for one month, and normal temperature products are at least one quarter or even six months.

However, under such a hierarchical management system, not all sales data determine the life and death of products. After all, convenience stores have limited SKUs and limited display space. In order to satisfy consumers' shopping convenience, we can also use this perspective to manage product selection.

The ABC classification applies to substitutable products, and the non-substitutable products do not necessarily apply to the ABC classification. In addition to the Pareto Principle (the eighty-two rule), we also need to refer to The Long Tail, because the rule of thumb tells us: 80% of sales Comes from 20% of products.

3. The effect of display

The category strategy has been established, the products have been selected, and then we have entered the steps of where and how to display.

To paraphrase the terminology, it is "table account" (the specific manifestation of display), another term is "pange map". The display planning can be viewed from the following perspectives, including the completeness of the display products, the number of display spaces, the display surface, the display height, the shelf movement, and the display type.

In summary, the specific manifestation of display is a ledger, which is a tool for category management and presentation. From the consumer side, it is easy to find and purchase, and from the product side, it is to increase sales and increase profits. From the point of view of the store, it is convenient to order and replenish.

4. The product itself can't speak, how to make it sound?

The room temperature products in the convenience store have hanging products on display, the purpose is to make the lying products stand up for consumers to choose. But the cold chain products in the air curtain cabinet seem to have not yet been. 7-ELEVEN pointed out that in order to change to a hanging display, in view of the appearance of the product, eating habits and food safety considerations, it has been discussing and re-planning the product packaging design with suppliers. Currently, there are more than 20 hanging items.

How to Tell a Good Retail Story-Commodity

5. XYBB-MALL Categories suitable for display in convenience stores:
- AUDIO (headphones, etc.)
- CABLES (Apple data line, etc.)
- COSMETICS (False Eyelashes, etc.)

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