The Foundations of Merchandising

Feb 26, 2010

We all are shoppers and consumers, and most of us are creative entrepreneurs of one type or another. So, we are well-equipped to create and build an effective showroom, right?

Is there a right way and a wrong way to put stock on the shelves? Are there rules to merchandising that are more than just simple regimentation? And, by the way, is it best to merchandise vertically or horizontally?

The answers to those proverbial questions are a decisive maybe, yes and sometimes. While there are some hard and fast rules to quality merchandising, there are many ways to effectively place products in order to maximize visibility, turns and ergonomics.

Consistency is King

If we start with the basics, we soon discover what sets the most successful retailers apart from others-the key element of consistency.

As much as we aspire to embrace change, don’t you believe it. We crave order when there is a decision to be made, because it helps us along the path of “least resistance.” While shopping, we are assaulted with tricky “call-outs,” colors, logos, flashing lights and canned announcements. Soon, our overexposed minds seek the refuge of order and direction.

Consistency and order in merchandising can be as simple as it gets, and starts with taking inventory of what you have to work with.

Let’s say you are building a display of performance products. It’s an odd-shaped assortment of open stock, boxed and carded merchandise. Some of it is small and light like gauges, some big and heavy like exhaust components.

Look at what you have to work with in the way of fixtures. If you are going to hang all of the carded products, make sure you use the same type of hooks on all the packages. If you are going to use two different lengths of hooks, always put the longer ones on the bottom. Make sure that where you place this section of carded product makes sense to the shopper, and doesn’t look like a disconnected afterthought.

This applies to shelves as well. Never use a deep shelf above a shallow one. First of all it creates a top-heavy, unbalanced look. And from a visibility standpoint, the product below the deep shelf is hidden and at a disadvantage for selling and stocking.

This small-on-top, larger-on-the-bottom concept is a natural direction to go when building just about anything. Foundations are rarely smaller than the buildings they support. And, while physically possible, top-heavy designs are not as symmetrically appealing.

With the top-to-bottom balance established, now let’s talk about left-to-right. Back in my days of working for a large mass merchant, regardless of whether we built a display vertically or horizontally, we always put smaller items to the left.

In other words, if you had 8-ounce and 12-ounce cans of car wax to stock, the smaller size always went on the left. Why? Well, conventional wisdom dictated that most people are right-handed and that they would naturally reach for the larger size on the right, therefore increasing your average sale.

That theory can be debunked by any number of exceptions these days, so let’s just say the real reason was to promote consistency throughout the departments. And that, of course, brings us back to path of least resistance.

Multiple Goals

Now, let’s move past the basics and on to more complex fare.

We established that our fixtures will be symmetrical and balanced, and that it doesn’t matter if the small item is on the left or right, as long as you do it the same way every time. Now, the challenging part is to lay-out or merchandise your product with multiple goals in mind.

The first question is, vertical or horizontal?

Well, the answer for most retailers lies within two areas of physics-how big your showroom is and how many different types of products you have to display.

I have found that in most, but not all, cases, specialty equipment retailers are short on space and long on product mix. That would suggest that multiple vertical statements are best. This allows you to tell a story in a short amount of space, and to reorder and maintain the line with less labor.

Now, armed with a plan, here are our goals:

• Determine by available showroom space vertical or horizontal layout
• Determine a layout that is easy to follow for customers and those who re-order product.
• Determine space allocations equal to the movement of the product
• Lay-out products using every available square inch of space between products, and keep it tight
• Always make a dedicated space for new, featured or promotional products

Rule number one when you are merchandising is to not stock the area until you are completely satisfied with the layout. Only have enough products to create a single (unless volume of that part number dictates otherwise) facing or “home” for each item.

Only when you have the layout finished do you load in the balance of the product.

Always start at the bottom and work your way up, creating a free zone of about 6 inches to work with above and none below. And, try to leave one or two empty facings per 3- or 4-foot section for product that is backordered.

Next, maintain a low profile. Don’t exceed 60 inches in height on freestanding merchandisers or gondolas. If you fixtures are already that high, don’t stock tall items on top shelves that will block your customers’ view of the rest of your showroom.

Always use shelf tags to identify product placement. If you don’t have any, make some. It will save you lots of time later. If you don’t claim the space, it’s a good bet that the wrong item will end up there.

And when staging carded product during a remodel, take it off the wall or panel, but leave it on the hook so similar part numbers will stay together.

On a larger scale, be sure to draw up a floor plan so that you can move categories around in concept two or three times without actually touching a product. Your goal should be to perform your merchandising task just one time per plan. And that one time gets it right.

While I would never claim to have the final word in showroom merchandising, having been its student for a while I can tell you again that the most successful retailers follow guidelines on the basics. Beyond the basics and into display work is another world where the real fun begins. After you’ve built the foundation, you can let yourself run wild with creativity!

Good Selling!

Note from Brion: Remember, the shopper in your store thinks he’s at the short-attention-span theater. The good news is you direct the film, so make it easy to follow the merchandising path… to a happy ending!