It is vital for retailers to ensure the customer is always able to find the desired product on the shelf. Therefore, merchandisers need to make sure that they are able to quickly and correctly deliver this product.
To do this, they use a planogram, which can both make the work of the merchandiser easier and complicate it. If the planogram is poorly prepared and the layout does not correspond to it, this can mean losses for retail operators.
Mike Savitsky, tech lead of merchandising automation solutions at IBA Group, explores how modern technologies are changing the way planogramming is undertaken and how this can benefit European manufacturers and retailers.
Obsolete Methods: Microsoft Excel Or Microsoft PowerPoint
Planograms are usually prepared using MS Power Point and MS Excel software and printed out. Often these are ordinary tables with the names of goods inscribed in the cells.
These planograms barely incorporate the features of commercial equipment, and products can be easily confused, because they often differ in only one detail. For example, the same mineral water can be sold in bottles of 1.5 litres and 2 litres, and cottage cheese of the same brand can be 1% and 5% fat.
Goods may be confused not only by merchandisers, but also by managers who later check the layout from photos. If one employee mixes up the numbers in the cells, then the other can just as easily confuse them.
As a result, the work looks good on paper, but in reality, the shopper fails to find the desired product on the shelf and leaves the store without a purchase. And this results in losses.
New Technologies for Retail: Planogram In A Minute With Plano Creator
To address this challenge, the Plano Creator module was developed, which is included in the Goods Checker system.
Goods Checker is an ecosystem designed to automate merchandising processes. The solution helps to monitor whether the goods are displayed correctly, plan the delivery logistics and deliver goods to the point of sale in due time. The performance results are stored in the database for further analytics.
With this solution, businesses are able to organise merchandising properly and increase sales. Managers, in turn, do not need to sort photos manually – they can devote more time to analytics, and merchandisers can immediately identify which products are wrongly placed.
Plano Creator is a constructor module intended for creating electronic planograms. With this module, a manager can create a planogram in just a couple of minutes incorporating several hundred items with photos, which provide a realistic presentation of goods and commercial equipment.
Pros Of Plano Creator
- Planograms are created faster than with Excel or PowerPoint.
- Convenient approach to handling of planograms with a large number of outlets and types of equipment.
- Convenient category tree even with more than 4,000 items.
- Friendly interface to quickly add new items and equipment.
- Checking the planogram for correctness (products in the air, products intersecting with the shelf, overlapping products, a wide product on a small one).
- Function of planogram view in the mobile application.
What is required:
- System purchase costs.
- Training for employees to use the new tool.
In Plano Creator, managers use drag-and-drop to create planograms that can be saved in MS Excel and PDF formats. Planograms with 100 SKUs can be created in one minute.
One of the planogram options in Plano Creator is the grid planogram. It may be used for products of the same size, such as chocolates or tobacco products.
To create a planogram, an entire brand, sub-brand or individual SKU may be selected.
The planogram shows the number of SKUs that need to be put on one shelf.
Using this system, it is possible to display not only the final SKUs, but also the entire sub-brand. This is useful when a product has not arrived at the store. In this case, the merchandiser sees that the space is available for the product.
The grid structure cannot be used for all purposes; rather it is suitable for a very limited range of products. Most often, manufacturers and distributors have a wide range of products, which in 99% of cases have different sizes.
That's why Plano Creator also has a shelf structure. The shelf structure enables users to customise the dimensions of the equipment, the number of shelves, their sizes, etc.
When preparing a planogram, the dimensions of each SKU are immediately visible, and after dragging it onto the equipment, the space remaining to the end of the shelf is calculated. This helps to check the occupancy of the rack.
The shelf structure assists in creating individual planograms, for example, for each retail chain. After all, demand is different at various locations, which means that the presentation of goods on the shelves must be adapted to demand. Also, this approach streamlines the distribution of goods across retail chains.
Plano Creator Drives Up Profits
Plano Creator is an easy tool to speed up the creation of planograms and simplify their updating. It also helps managers and executives get up-to-date and aggregated data from stores on time.
This ensures that managers are able to establish realistic KPIs for merchandisers and evaluate employees fairly, while managers can increase the percentage of layout compliance with planograms and track the reasons why planograms are not being observed – out of stocks, equipment breakdown, etc.
According to InStore Implementation Network, full adherence to planograms results in 7.8% sales growth.
When the merchandising process becomes transparent for all participants, and aggregated accurate data enters the enterprise information system, the percentage of planogram compliance increases, which means sales and profits grow.