Retail Category Management Basics
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Retail Category Management Basics

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Category Management Basics

Category Management Basics

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Retail Category Management Basics Retail Category Management Basics Presentation Transcript

  • 09/02/09
    • Amit Kumar –Business Development Partner
  • CATEGORY MANAGEMENT INVOLVES BUILDING A BUSINESS PLAN AROUND THE 4 P’S PROMOTING PRODUCTS PRICING PLACEMENT
  • Objectives
    • Review Objectives & Agenda
    • Category Management Overview
      • Why Category Management?
      • What is Category Management?
    • Implementing Category Management
      • Core Components
        • Strategy
        • Business Process
    09/02/09
  • Agenda -- Continued
      • Enabling Components
        • Organizational Capability
        • Information Technology
        • Collaborative Relationships
        • Scorecard
      • Benefits of Category Management
    09/02/09
  • Agenda -- Continued
    • The Strategic Category Business Process
      • Corporate Strategy
      • Category Definition
      • Category Role
      • Category Assessment
        • Assessment Worksheets
      • Category Profitability
    09/02/09
  • Agenda -- Continued
    • Category Management Strategies
    • Category Management Tactics
      • Assortment Tactics
        • Assortment Choices
        • Category Role Linkage
        • Assortment Analysis
        • Assortment Assessment Worksheets
    09/02/09
  • Agenda -- Continued
      • Pricing Tactics
        • Pricing Choices
        • Category Role Linkage
        • Pricing Analysis
        • Pricing Assessment Worksheets
      • Promotion Tactics
        • Promotion Choices
        • Category Role Linkage
        • Promotion Analysis
        • Promotion Assessment Worksheets
    09/02/09
  • Agenda -- Continued
      • Shelf Presentation Tactics
        • Shelf Presentation Choices
        • Category Role Linkage
        • Shelf Presentation Analysis
        • Shelf Presentation Assessment Worksheets
    • Integration Into Strategic Category Plan
      • Strategic Category Planning Worksheets
    09/02/09
  • Why Category Management?
    • Consumer Trends
      • Complex consumer demographics
      • Population growth rates have declined
    • Competitive Pressure
      • New store formats
        • Warehouse clubs & mass merchandisers
      • New product introductions
    09/02/09
  • Why Category Management? -- Continued
    • Economic Considerations
      • Slow growth economy & low interest rates
        • Companies pressured to improve financial performance
    • Industry Capability
      • Shared business goals -- Focus on Consumer
        • Shifting from internal optimization to maximizing consumer value
      • Trading Partner Alliances
        • Leveraging of resources between trading partners
    09/02/09
  • Why Category Management? -- Continued
    • Empowerment
      • Authority & accountability to front-line managers
        • Pricing
        • Procurement
        • Promotion
    • Information Technology
      • Distributors & Suppliers share data
    09/02/09
  • Category Management & ECR
    • ECR (Efficient Consumer Response) creates an environment and tools which enable the distributor & supplier trading partners to work collaboratively to deliver superior value on the products and services they offer consumers
    09/02/09
  • Category Management & ECR -- Continued
    • Category Management key component of ECR
      • Provides strategic framework, business process and organizational framework within which collaboration takes place
      • Profound impact on each of the four ECR strategies
        • Efficient promotion
        • Efficient Replenishment
        • Efficient Product Introductions
        • Efficient Store Assortments
    09/02/09
  • Definition
    • Category Management is a distributor/supplier process of managing categories as strategic business units, producing enhanced business results by focusing on delivering consumer value.
    09/02/09
  • Basic Principles of Category Management
    • Categories are managed as strategic business units
    • Categories are managed strategically through category plans and strategic roles
    • Category Managers control their share of company assets
    • Asset Returns measure performance and establish priorities
    09/02/09
  • Basic Principles of Category Management -- Continued
    • Responsibility for category performance/ownership is clearly defined and not fragmented across organization
    • Category Management leverages distributor and supplier expertise for mutual benefit … neither party can do the job alone
    09/02/09
  • Six Components of Category Management
    • Core Components (essential)
      • Strategy
      • Business Process
    • Enabling Components (assisting)
      • Scorecard
      • Organization Capability
      • Information Technology
      • Collaborative Relationships
    09/02/09
  • Strategy
    • Categories are strategic business units
    • Overall company strategies provide a infrastructure for category level strategies
    • Strategies must be clearly understood throughout the Retailer’s organization
    09/02/09
  • Business Process
    • A formal, disciplined set of activities designed to produce a specified output
      • Development and implementation of Written Category Business Plans
    09/02/09
  • Scorecard
    • A tools that defines, measures and monitors the progress of Category Business Plans
    09/02/09
  • Organizational Capability
    • Development of the organization’s core competency
      • Through organizational structure
      • Roles/Responsibilities
      • Skill/Knowledge development
      • Reward Systems
    09/02/09
  • Information Technology
    • Critical elements of the Category Business Planning Process
      • Need data-driven, fact-based analysis and performance measurement
    09/02/09
  • Collaborative Relationships
    • Relationships with suppliers who acquire unique perspectives, resources and skills
    • Common objective -- delivering superior consumer value more profitability
    09/02/09
  • Distributor vs. Supplier (Overlap & Differentiation)
    • Supplier (Manufacturers & Brokers)
      • STRATEGY
      • INFO TECH
      • ORG. CAP.
      • SCORECARD
    • Distributor (Wholesalers & Retailers)
      • STRATEGY
      • INFO TECH
      • ORG. CAP.
      • SCORECARD
    09/02/09
  • Category Definition Category Role Category Assessment Category Scorecard Category Strategies Category Tactical Plans Implementation Plan Category Review The Strategic Planning Process CATEGORY MANAGEMENT PROCESS 09/02/09
  • Category Definition
    • The trading partners need to define the new category with a name
      • What is it?
      • What are the sub-categories?
    09/02/09
  • Category Role
    • The distributor (with supplier input) would define the overall role the selected category is going to play in the distributor’s total business
      • How important is the category?
      • How to leverage the importance?
    09/02/09
  • Category Role -- Components
    • Destination
      • To be the primary category provider and help define the retailer as the store of choice by delivering consistent , superior target consumer value
    • Routine
      • To be one of the preferred category providers and help develop the retailer as the store of choice by delivering consistent , competitive target consumer value
    09/02/09
  • Category Role -- Components Continued
    • Occasional/Seasonal
      • To be a major category provider, help reinforce the retailer as the store of choice by delivering frequent , competitive target consumer value
    • Convenience
      • To be a category provider and help reinforce the retailer as the store of choice by delivering good target consumer value
    09/02/09
  • Category Assessment
    • Comprised of accumulation of all appropriate consumer, distributor, supplier and competitor data for analysis relative to opportunities represented for the category chosen
      • How is the category doing?
      • Versus Potential? Versus Goals?
    09/02/09
  • Scorecard
    • Establishment of the performance measures by which the category manager will measure the quality of the execution of the plan
      • What are the goals & objectives?
      • How is the progress?
    09/02/09
  • Category Strategies
    • Assignment of specific strategies to key elements of the overall category
      • What is the business plan?
      • How will it achieve the role & scorecard?
    09/02/09
  • Category Strategy - Components
    • Traffic Building
      • Consumer Draw
    • Transaction Building
      • Increase the Register Ring
    • Profit Generating
      • Improve Category Gross Margin
    • Turf Protecting
      • Defend Sales and Share (other formats)
    09/02/09
  • Category Strategy -- Components Continued
    • Cash Generating
      • Increase Category Cash Flow
    • Excitement Creating
      • Generate Sense of Urgency & Opportunity
    • Image Enhancing
      • Reinforce Retailer’s Desired Image
    09/02/09
  • Category Tactics
    • Specific activities supporting the category strategies which would include item variety, everyday and feature price targets, shelf presentation, etc.
      • What do we do to achieve the strategy?
      • Who does what?
    09/02/09
  • Category Tactics -- Components
    • Assortment
    • Pricing
    • Promotion
    • Shelf Presentation
    • Product Supply
    09/02/09
  • Plan Implementation
    • Key Components of Plan Implementation
      • Approval Process
        • Strategic Fit
        • Scorecard Impact
        • Resource Allocation
        • Impact on Other Areas
      • Assigning Responsibilities
      • Scheduling
    09/02/09
  • Category Review
    • Ongoing review and measurement of the progress of the plan toward the category role and scorecard, and modification of the plan when appropriate
    09/02/09
  • Conclusion
    • The Staples & Grocery Retail industry is in a major state of transition. This change is a function of a complex mix of consumer, technological and market factors.
    • Category Management represents a business oriented approach to achieving business results -- both for distributors and suppliers
    09/02/09
  • Thank You Email- [email_address] ,joinhand2hand@gmail.com Website-http://hand2handsolutions.webs.com/index.htm Contact +91-9818995422,09785641086 Grow with Growing Industry 09/02/09