Point
of Sale Display of Products
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Merchandising
(E)
by
Laurus Nobilis
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What
is the Point of Sale Display? What are the main elements
of Merchandising? How to apply the Point of Sale
Display and Merchandising
in your business?
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Posted:
Nov 2008 |
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Every
business has it's main objective – the Profit.
Roughly speaking, the profit is the difference
between all input costs of some product and sales
price. The profit itself is the result of sales
turnover. |
With
every sales transaction there is some profit generated.
Therefore, more sales means more profit. Now it is
obvious that if we want to increase our profit, we need
to increase our sales volume.
The
sales volume in same time period, in the same sale
outlet can be different. The demand for the product does
not have some fixed demand. The sales result can always
be higher or lower. The sales depends of many factors.
The product benefits, brand, image, price, service,
exclusivity, etc are some of the elements that influence
the product.
But
for the same product, with the same characteristics,
during the same period in the same retail outlet, the
sales volume can vary. The moment that influences the
sales in the outlet is called Merchandising or Point
of Sale Display of Products.
Merchandising is the decisive moment in proper point of
sale display of product.
The
merchandising is the process of effective positioning
and arranging of product in the sale outlet that have the main objective
– maximizing the sales in the given moment. The
Merchandising is the process of point of sale display
of product, that increases the chances
of product to be bought. The Merchandising gives
competitive advantage of one product over another. The
Merchandising
is increasing the sales level above the sales that
occurs without merchandising.
There
are several approaches to merchandising.
Approach is different for every industry. Food
merchandising is different that TV sets merchandising.
Fashion clothing point of sale display is different than
newspapers and magazines point of sale display. Still, some
elements can be applied in different branches.
The
general approach to Merchandising can be defined as system that is
covered by elements of CLIPBOARD concept. CLIPBOARD
stands for the following elements of Merchandising:
- Corporate
Block Layout
– Grouping products from one franchise owner
at a specific place is called corporate block
positioning. This positioning gives advantage
of visual impact, brands synergy and increases
perception of brands value.
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Location
– Right
location ideally means multiple sales points,
early in the traffic flow, before competition,
ate the eye level and easily reachable.
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- Inventory
Management - Too
much stock in the outlet means frozen capital
and danger of expired dates. Too low stock
might lead to Stock Out and loss of sales, profit
and customer's loyalty. Proper inventory
management can be done with right use of
history sales data, proper forecasting and
negotiating with customer.
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- Pricing
– Most
of the people will first
observe the price before considering shopping.
This is especially typical in future
consumption outlets. Most of the people are
price sensitive. Exposing the price with clear
price tag is giving the right information to
the shopper and making him to make the right
decision. If the price is not displayed or is
incorrect, the customer may feel that
something wrong with product, or that the price
is too high. This can discourage customer from
shopping.
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- Brand
Order – Every
supplier has more than one brand in different
packs. These brands have different market
strength. During the merchandising, brand order
should be respected. This means that the
strongest brand should be positioned in a first
place, in a main traffic flow. This gives the
effect of umbrella, since the stronger brand
is supporting other brands.
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- Out-warding
Facing of Labels – This
is the small, but important detail in point of
sale display. Labels
facing the shopper gives a clear
communication, increases brand image and calls
for action – shopping.
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- Advertising
materials – are
supporting products, gives info about price,
promotion, function and benefits. They
should be used whenever possible.
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- Rotation
of Stock – Since
most of the FMCG products have limited
shelf life, expiry is not the solution.
First Expires First Out ( FEFO ) rule
enables fresh product for consumer and
no write off for retailer.
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- Dust/Housekeeping
– Who
likes dusty and dirty product? Do You?
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