In most retail stores, shelf positioning is considered a crucial process to drive sales. When implementing product placement or planning a strategic store layout, retailers must ensure planogram compliance to maximize sales and improve store performance. This is simply because of its goal: to help increase in-store sales and profitability.

Why Planogram Compliance Matters?

As a retailer, you must ensure that the products on the shelf are the same as those in the planogram. Planogram compliance refers to the store’s execution of pre-defined store layouts. The primary goal of planogram compliance is to ensure that every retail store is optimized to sell the offered products within the right time. Retailers and shoppers can easily find the right items when stores are compliant with the help of planogram software. Reports show only 30% of retailers can measure compliance, and product categories are less than 50% compliant without planograms, which causes poor retail execution. Nowadays, retailers find it difficult to maintain planogram compliance, which can lead to skewed results and inaccurate data. Most retailers now rely on professionals who provide planogram services to ensure proper compliance with the right product mix to target customers. The following are planogram factors you need to consider in your store:

1. Without planogram compliance, you will not get the results.

Your goal as a retailer is to boost sales, improve category profitability, and build a store that caters to the customer's needs so that they will keep coming back. Planograms can help you achieve your goals with proper shelf planning. Anyone can look at a shelf layout and try to replicate it in-store, thus simply creating a planogram is not enough. You need to ensure that it is implemented correctly. So, what happens when you fail to implement planograms properly? What financial implications occur due to non-compliance? These are the numerous consequences in addition to not increasing sales and profitability.

• It will be difficult to boost customer traffic.
• You will struggle to lower your stock replenishment costs.
• You will struggle with holding too much inventory.
• You risk wasting the potential for sales of your shelf space if you do not maintain compliance.

Planograms can help optimize inventory levels and reduce overstocking or understocking of products with the compliance feature. This helps improve operational efficiency, reduce wastage, and save costs.

2. If you do not manage the shelf space, you will lose customers.

For retail stores, shelf space allocation has a significant impact on sales. That is why it is often described as a retailer’s biggest asset. It also means that if you do not manage it yourself, someone else, like your suppliers, will do it. For example, you will find suppliers will have staff traveling from one store to another to manipulate shelf space allocations. If you do not take control of your shelf space, they will take a chance to fill extra shelf space. There is nothing wrong in providing more shelf space for each product. The problem occurs when a supplier pressures you into giving their product additional shelf space, even when it is not in the category’s best interest. Even a slight change in shelf space can impact the overall performance of your store, especially when you make such a change at multiple stores.

Planogram compliance can help ensure that products are displayed consistently across all stores, which can help reinforce the brand image and improve brand recognition. This helps create a more organized and visually appealing store layout for customers to find the products they are looking for. This improves the overall shopping experience, which increases customer loyalty and boosts sales.

Overview of Nexgen Planogram Services

Nexgen offers store-specific planograms for clients that optimize sales and achieve category objectives. We create customized planograms for your business to ensure that these are better aligned with your goals and merchandising strategies. Our expertise in planogram automation helps us build planograms faster, better and consistently. Whether it is creating a planogram from scratch, or a typical reset, we have the knowledge, tools, and experience to get the job done for you.

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