Modern merchants have been making the switch to online storefronts in droves lately, but eCommerce is unlikely to replace brick-and-mortar stores. As store owners know, many customers prefer to be able to evaluate goods in person. While establishing an effective digital marketing strategy is important for brick-and-mortar store owners, retail merchandising is still the best way to attract storefront customers.
What Is Retail Merchandising?
Retail merchandising focuses on how store owners make their goods available to consumers. It refers to both the strategy and execution of merchandising. Everything from product selection and placement to display design falls into this general category.
General retail merchandising can also refer to things like packaging, product design, and brand promotions. When store owners engage with the basics of retail merchandising, they’re usually more focused on a subset of this essential strategy called in-store merchandising. In-store merchandising refers more specifically to factors that influence shopper’s experiences in retail establishments such as shelving layouts, space allotment, and display setups.
How to Develop an Effective Merchandising System
These days, most large retail companies use specialized digital merchandising software to manage merchandising systems. The software allows managers to assign tasks, execute merchandising decisions, and evaluate employee performance, often across multiple storefronts. These software programs can also offer a cost-effective solution to smaller businesses.
Whether store owners opt to invest in specialized software or not, their retail merchandising plans should always touch on a few key issues. A good system will include:
- A store layout that directs foot traffic appropriately.
- Changes in displays to reflect the season or upcoming holiday promotions.
- Budgeting for signage, lighting, and other store fixtures.
- The use of predictive analytics to ensure that merchandise is available as needed.
A well-developed retail merchandising system will maximize turn, minimize the need for markdowns, limit backorders, and increase margins. While store owners can put in most of this work up front, it’s also important to recognize that effective retail merchandising is an ongoing activity. The plan will change over time.
Retail Store Audits
Companies with multiple stores often perform retail audits to make sure each facility’s merchandising lives up to established standards. Store owners can also perform merchandising audits to ensure that all of their products, regardless of how they are branded, are being displayed appropriately. Auditors should check:
- Correct placement of items
- Expiration dates, if applicable
- Item counts on shelves
- Backroom inventory
- Use of floor space
- Shelving layouts
- Counts of facing items per SKU
As with retail audits performed by brands, merchandising audits are best executed by professionals working with software-assisted visual verification systems. Leveraging the power of modern software solutions allows store owners to collect valuable data and ensure that the employees tasked with performing the audit are held accountable.
A Good Strategy Creates Measurable Results
A good retail merchandising strategy will create measurable results that allow the business to grow and thrive. Store owners can start by performing in-house audits, then make adjustments as needed based on their results. Repeating these audits periodically and recording everything allows store owners to compare changes in merchandising strategies with customer data to see what works and what doesn’t.