he purpose of space

management programmes
is to get the right product,
at the right time, into the
right space, describes Mike Robin,
the senior manager for merchandising
in the South Pacifc at A.C.Nielsen.
There is a scientifc side and an art
side to merchandising, he continues.
We can take care of the science as
we provide the software tools to
improve performance.
Shelf space is too precious to leave
to intuition. As the cost of space
increases, space management
programmes allow retailers and
suppliers to analyse product
performance based on solid facts.
Understanding the importance of
department and category is critical
to meeting your customers needs.
In an industry operating on small
margins and high turnover, even
a minor change at the shelf can
have major efects showing up as
either extra proft or loss. Good space
management programmes can lead
to increased market share, consumer
satisfaction and loyalty.
PLANNING
Although visual merchandising
and shelf displays are important, the
focus is moving beyond individual
shelves to the total store and to
cross-store comparisons. Wherever
they operate, global retailers and
manufacturers want to be able to
balance the diference between
in-store space and assortment
performances in a standardised way.
They want this to be executed
quickly, efciently and accurately.
Macro store planning needs to work
alongside micro shelf planning.
Efective retailers and suppliers
understand a solid category
management framework enables
them to be more efective and
successful in their strategies.
Detailed and accurate information
is, therefore, the backbone of all
space management applications.
Retailers and manufacturers agree
that a tool to help organise shelves
is one of the retail industrys most
important developments.
METROPOLITAN-
STYLE EXAMPLE
The merchandise manager of
Foodstufs Ltd. in Wellington, Peter
Davis, faced these problems whilst
planning the new New World store in
the Capitals railway station due to
open at the end of this year. It will be
the companys second Metro store
designed for city dwellers with an
emphasis on convenience. Overseas
trips to the UK, France, Italy and
the US inspired Foodstufs to create
a store with a metropolitan style.
We will focus on merchandising
excellence, promises Davis.
To achieve this, Foodstufs did
something quite unusual for a retailer
it outsourced its space management.
Foodstufs, Auckland ofce began
outsourcing early this year and the
Wellington management introduced
it a few months ago.
It is quite revolutionary for a retailer
to outsource the space management
for a whole store, comments
A.C.Nielsens Robin. Retailers usually
like to have tight control over the
process and do not like sharing
precious sales or turnover fgures with
outsiders. We provide the tools and
databases, but in the end its the retailer
who makes the decision, says Robin.
GETTING IT RIGHT
Foodstufs Davis is happy with the
decision to outsource because this
gives the key accountants the time
to concentrate on their tasks. He
looks forward to getting proper
answers to questions such as have
we allocated enough space to
certain product categories? The
planogrammes should also help
automatic re-ordering based on
market share.
Melinder Kaur, the manager of retailer
services at A.C.Nielsen, is responsible
for all of the 46 New World stores
and their shelf performance in the
Wellington region including the one
under construction. She is looking at
the stores category by category. From
spACE MANAGEMENT
What happens at the shelf is crucial. Its where the customers
interact with retailers and the manufacturers. Understanding
the dynamics of this interaction is essential.
Retailers and
manufacturers agree that
a tool to help organise
shelves is one of the retail
industrys most important
developments.
Imagine your new store opens in
eight weeks. Pressure is mounting
and the debate between department
managers over space and layout of
their categories is in full swing. As the
foor planner, you are in the middle
bouncing from meeting to meeting
armed with your printed foor plan,
a rainbow of highlighters and, of
course, an eraser. Space is no longer
a commodity, it is the battleground
where key choices are made. The
outcome could mean success or
failure. A computerised store planner
could help to make simple the process
of building, designing and evaluating
proftable and efective layouts.
Understanding the
importance of department
and category is critical
to meeting your
customers needs.
key information provided by the
retailer such as how much a product
moves and the category schematic
she creates a store planogramme.
Using AutoCAD for increased accuracy
and realism, the planogrammes can
be dragged and dropped onto the foor
plan, bringing vital performance data
to support decisions. Shoppable and
non-shoppable areas can be created
such as bakery or back-ofce.
Customers are becoming increasingly
confused and frustrated in some stores
as they have too many choices on
the shelves. They want neat and clean
shelf layouts in their favourite stores.
TOOLS
Making it easy for the consumer
and the appropriate shelf performance
will positively impact revenue, proft
and overall growth says Kaur, pointing
to the latest version of the store
*

TECHNOLOGY

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planning tool Spaceman released in
October last year. Spaceman is a
solution for category management,
she says. It makes sure products are
where shoppers want them. It helps
to determine which product to stock
where, and how many facings of each
product are needed to maintain the
balance between overstocking and
out of stocks.
Ric Bardsley, the space planning
manager at Warehouse Stationery
Ltd. reveals the blue sheds are also
working on proftable store layouts.
He uses information such as sales
histories and feedback from the
stores behind planogrammes
in order to develop an efective store
database. Bardsley is sure Warehouse
Stationery will soon deliver more
proftable stores.
Manufacturer;
Category segments;
Brands;
Sub brands; and
Price.
TEAMING UP
Make a partner of your retailer
work with him, take a category
management approach, but keep
it simple, is Gatleys advice. Rather
than merely compete for promotional
or shelf space, manufacturers
and retailers should work together
to make the entire category as
proftable as possible.
Jamie Rowaldson, the process
development manager of Coca Cola
Amatil NZ Ltd., has been creating new
merchandising standards with the
data based planogramme called
Fridgeman a Spaceman application.
We have a large product range, but
only limited space in the market, he
says. With the help of planogrammes
we were able to increase the space
for the proftable products. Fridgeman
is an automatic planning tool that
is easy to use in store, he adds. It
helped in understanding the current
performance and in making a fact-
based decision on the optimal
assortment.
Using channel clustering and an
automated space planning tool,
Coca Cola Amatil was able to
maximise the return on investment
fridges for their cold drinks.
By Doris Evans, a freelance retail writer
based in Auckland.

Customers are becoming

increasingly confused and
frustrated in some stores as
they have too many choices
on the shelves.
Brent Gatley, the trade marketing
manager of Energizer NZ, has vast
experience with planogrammes.
Before Energizer NZ (a wholesaler
and distributor of batteries) started
to work with software planogrammes,
it conducted a lot of market research,
looked at sales and movement of
articles and its inventory management.
With the help of the software they
are now able to learn more about
the relationship between sales
versus movement versus space
versus proft by:
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