Retail News Update

Retailers are adding dividers, angles and other tactics to call attention to shelves and make restocking easier. Studies show their efforts are paying off.

The best way to appreciate the impact category management has had on the shelving supermarkets use is to recall an ancient proverb: “A journey of 1,000 miles begins with a single step.”

Category management’s impact on store shelving equipment and techniques has been a series of single steps rather than any dramatic giant leaps, experts say.

True, when the category management concept first surfaced about a decade ago, some stores plunged in with ideas such as creating breakfast aisles that included everything from frozen items to cereals.

But “category management failed miserably to address the cost side of the equation,” contends Milton Merl, president of consulting firm Milton Merl & Associates, New York. With the cost of a standard 4-foot store shelf gondola around $15, it has been difficult for supermarkets to justify spending $80 to $90 for a wheeled unit that could be brought into something like a breakfast aisle, Merl notes.

However, just because stores aren’t completely rearranging their products doesn’t mean that many haven’t taken category management to heart. Those that have are doing the small things, the single steps, like installing dividers on existing shelving, or adding new signage on shelf rails, or even tilting bottom shelf signage upward, to enhance sales and decrease restocking costs.

“Stores are trying to get more efficient,” says Tony Kadysewski, communications manager with Trion Industries, a major shelving product manufacturer in Wilkes-Barre, Pa. “What you want is the shelf to communicate very effectively. You want people to determine very quickly ‘What are my choices here?’”

Adding shelf divider rails and installing either gravity- or spring-fed pushers behind products can increase shelf integrity, ensuring that products will be where consumers can see them and can see the proper price tags in front of them.

Looking at results from European stores (American chains won’t release figures), Trion has found sales of confectionary products increase 10 to 25 percent with a shelf system that includes dividers, a front rail with easy-to-read labels and a pusher system to keep products flowing forward. Trion found sales in pasta and rice increase 11 to 20 percent, in snack foods 10 to 15 percent and in soups and sauces, 8 to 17 percent.

Dividers have become especially popular in the health and beauty category, which often includes many small and oddly shaped containers. “Health and beauty in general have always inspired people to find a way to keep things straight,” notes Fred Mulfinger, manager of analytical services at Gladson & Associates, store-design firm in Lisle, Ill.

Trion found that for one 100-store U.S. supermarket chain, spending $139,600 to install a shelf divider system for 400 facings of deodorant and hair care saved five hours a week per store in labor costs, or $390,000 a year chain-wide, a dramatic demonstration of the impact small shelf changes can have on a chain’s bottom line.

Labeling also has taken on added significance in shelf management, both from the consumer and the store-efficiency points of view. With few stores unit pricing items these days, the importance of readable shelf price labels has increased. Easy-to-follow pricing labels, in turn, can aid faster restocking.

Gladson has developed a system for putting color photos of items on shelf price labeling. “Some of these small efforts are going a long way to keep the planogram faithful, to keep the planogram useful,” says Mulfinger.

For larger chains, Gladson has come up with life-size planograms that can be attached to the back of shelving units. Called Shelf Master, the planogram can display actual items to be put in various spots on the shelves, providing store employees with an almost paint-by-numbers approach to restocking. The system can cut restocking costs as much as 80 percent, Mulfinger says. When purchased with black-and-white photos, the system is cost-effective for chains or 150 stores or more, he says. A color-photo version becomes cost-effective for chains with 200 or more stores. The technique works best in relatively static categories where the same layout will be used for a long period of time, he says.

Another shelf management consequence of category management has been stores working harder to draw shoppers into specific aisles. “They’re all trying to make a difference in the areas that set them apart,” such as produce, meats or prepared foods, Merl says.

In other sections of the store, the desire to create visual appeal often has meant turning more to displays provided by manufacturers, Merl says. Some, such as PepsiCo’s Frito-Lay unit, have promoted all-in-one displays that include a variety of their products. “We know retailers have become much more conscious of pre-built displays,” Merl says. “We find them being more receptive of POP being supplied by manufacturers. They try to create areas of visual destinations.”

That can be true even for something as routine as a baking aisle, says Mulfinger. “If you want to be a destination for (baking) mixes, you would carry more,” he notes. If not, then a store could determine an efficient product assortment, analyzing sales of each item in a category and arranging items in some coherent pattern, he explains.

A store would examine how many items in a given subcategory, say baking mixes, it needs for the market penetration it desires. If five mixes account for 90 percent of sales but four account for 80 percent, the store would need to decide it if it’s worth carrying the fifth product, Mulfinger says.

Stores still need to address such mundane shelf management concerns as how to increase sales from hard-to-see bottom shelves, experts agree.

One solution advocated by Trion’s Kadysewski–shelf tags angled upwards as much as 60 degrees to catch shoppers” attention.