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Merchandising Matters

Advice to vendors on packaging and racks.

By Lisa Kanak, The Cropper's Coprner (April 18, 2005)

How a store is laid out and merchandised is probably the most important visual aspect of our business. It sets the tone for traffic flow. It determines how much product we can comfortably fit into our stores, and can dramatically affect our sales for the better or worse.

Yet merchandising is often times the afterthought. We purchase first, and figure out where "it" will go later. Then, once "it" arrives, we discover "it" won�t fit in the space we thought it would. We need to create more space or worse, we crowd "it" together so that most of the packages are buried, or difficult to get to.

In our store, we had one product line that was heading to oblivion. During one of our marathon merchandising weekends, we created a custom spinner rack using the pieces we had purchased from Display Dynamics. In about 45 minutes, I had each of those "poor performers" on that spinner rack. The result? Most of those "poor performers" began to sell out. Now, instead of discontinuing the line, we are only eliminating a small portion of it and replacing its poor performers with newer products.

Merchandising matters. It�s a fact. Product placement affects sales. If people can�t easily see, touch, grab, or find what they are looking for, they will ignore it � even if it is the exact product they ask you for.

Manufacturers know that product has to be seen in its best light in order to achieve the maximum sell through. Many manufacturers have answered this issue by providing specialty racks for stores to display their products.

Problems with racks.

How much time and effort is spent designing racks to fit product? Each trade show we attend, we are amazed at the number of "new" custom fixtures that have been designed to "fit" this or that product line. What about the racks we purchased last year? They are now languishing in a back room, or packed with product it wasn�t designed to hold.

Each time I tell my father we need to replace one of our fixtures for something else, my father says, "buying fixtures is just like pouring money down the drain." However, without proper fixtures, product does not sell as well.

Our store is moving towards generic racks that can be used for specific size ranges of products. We have a slat-wall background, with adjustable spinner racks, slat wall spinner racks, slant wall racks, waterfall racks and these nifty flip racks. We can switch out the products easily. Fixtures can be moved to create a different product arrangement. And best of all, because we know how much each fixture can hold (from a dimensional point of view), we can create merchandise slots to be filled with products. Couple this with a point of sale that tells me what products we�re selling a lot of, or not selling enough of, we can determine which slots need replacing � and which slots should be kept.

Talk about being able to know our inventory � know our store�s real product needs, and being able to go to a trade show with confidence with a shopping list, and not being worried about buying too much (or too little).

There is just one cog in my "perfect display" framework � product packaging. Poor product packaging throws everything off. In fact, we have cut products from our sales floor for that reason alone.

Poor product packaging � something that takes up "too much space" compared to the price point, looks unappealing, or does not display well � can affect dramatically affect sales. Yet, it is one thing that simply takes a bit of prior planning from the manufacturer�s standpoint.

Simply stated, retailers don�t need more special racks � we need merchandise that can hang well on generic, easy-to-find, easy-to-replace (should they become broken), easy to move, flexible "standard" displays.

One of our least favorite sizes (especially for stickers) is 8 � x 11; that size takes up a huge amount of horizontal space. Our favorite, and most popular sticker module size is actually about 6 x 12. With this sizing, we can fit 5 neatly across a 30" waterfall rack � with just the top 1/3 of the sticker design showing. We also know that this size sticker means I can fit 50 skus in a 5� tall, 2 �� wide space, with my top rack at 6� high.

Conversely, when racking those 8 � x 11 stickers, my available SKUs drop to 30 total designs on a waterfall rack � and if placed on a slant-wall rack, the number only increases to 32. Where stickers are "king" (as they are in our store), low inventory investment (since we purchase 6-12 of each design), and high turn rates lead to higher profits. So as retailers, we want to fit as many stickers as neatly as possible onto each rack.

If 8 � x 11 were the only other "standard" size we had to worry about, this wouldn�t be as problematic. But it seems that when it comes to stickers, nothing is standard. Stickers come in all sorts of package sizes. And, they become difficult to merchandise, plan-o-gram, and generally "fit" into a display space.

What can be even more frustrating is when a product intended to hang is packaged just a hair too long for slat wall � or is sized a hair too wide to fit neatly on a standard spinner rack. Instead of tightly fitting products, we have excess white space. For retailers "excess white space" is synonymous with "wasted space." And, the sad fact is, most products don�t have an "excuse" for not merchandising well.

Advice to manufacturers.

Manufacturers can help solve these problems. My suggestion is to look at how package sizing will affect the way it is merchandised. Re-think your sticker module dimensions. Dimensions do matter. Many times, an 8 � x 11" sticker sheet could be split into two 5 x 12 sticker sheets � re-sizing a sticker design up or down slightly, or even adding a couple of extra "fluff" pieces is all that may need to be done. Or, if creating two complimentary packages isn�t in the game plan, simply extend the width an inch and a half, fold the sticker sheet in half, and package it in the same space as the single sheet.

Heidi Swapp introduced some innovative packaging concepts � products were folded at perforation marks in quarters. Honestly, customers will purchase an alphabet module that does not have the entire alphabet shown. If you�ve seen the innovative rub-on packaging from Making Memories (all you see is the uppercase and/or lowercase A) � it�s incredible. I can fit more than 30 SKUs of their designs & colors on the side of one standard spinner rack. Try that with an 8 � x 11 package! Of course, the best part is that they all sell and sell and sell.

Also, make sure the packaging doesn�t "curl" when hung. Curling stickers are difficult to see, read, and just look cheap. If you�re going to package them, it does pay to have that thin piece of cardboard backing � of course since many manufacturers are going to cardstock stickers, the backing is a bit less necessary. Make sure the top 1/3 of the sticker gives a clear indication of the items on the remainder of the sticker mod. If a sticker has to be completely visible to be purchased, it�s taking up a lot more space than it can ever pay for.

One last tip: develop suggested plan-o-grams using standardized racking systems for product lines (partial line plan, half-line plan, or entire line plan � i.e., store-within-a-store). Plan-o-grams and signage using standardized displays will be less costly � and much more useful than a one-season, custom fixture.

If we can keep slat wall, spinner racks, and waterfall racks in mind when we develop packaging concepts, it will allow for less wasted space, make it easier to slot products, purchase products, and sell them.

So, please manufacturers, get out of the racking business, and onto the standard merchandising bandwagon. Keep a slat wall spinner rack in your design area, along with a standard waterfall rack, and a small piece of slat wall. It will help you see what customers see � before the product goes into production and into the stores.

Spending a little more time on package planning, and less money on display design will enable your retailers to spend less on specialized racking and more on your products � or putting some profits away for a rainy day.

(Note: Lisa operates The Cropper�s Corner in Fredericksburg, VA. Email her at lisakanak@adelphia.net. To read previous Memory columns, click on the titles in the right-hand column. To comment on Lisa's ideas, email mike@clnonline.com.)

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