Merchandising MASTERY STATEMENT:

Transcription

1 GROTE TRAINING SERIES Merchandising MASTERY STATEMENT: In this module you will learn the Grote merchandising system and be able to identify and use the various components that are available. At Grote Industries, merchandising has a broad definition and includes: Point of Purchase (POP) Point of Sale (POS) Plan-O-Grams (POG) Promotions Product Packaging Store/Walk-in area maintenance Trade shows (both national and local) Literature Grote website and electronic ordering mechanisms Proper merchandising is an important function in the Grote sales process. You need to understand how these items can help you gather more real estate and market share. Market Classification... 2 The Total Package for the Automotive Market... 3 Displaying the Product in your Branch or Store... 4 Creating a POG... 6 Right Lamps for the Job... 7 Merchandising and Product Documentation... 9 Getting the Business... 9 The Upgrade POG, POP and POS Examples Additional Resources... 12

2 MARKET CLASSIFICATION At Grote merchandising is typically applied to two markets: Traditional Automotive markets are comprised mostly of automotive warehouse distributors which sell products using the independent 3-step distribution models. Heavy Duty Market is composed of Heavy Duty distributors, OE Dealer supply networks, and company owned groups. It s important to know what merchandising methods are available. This way, when you bring new customers on board, regardless of markets, you can suggest to your customer the proper products to build the offering for maximum exposure. It is important to create a strong, professional image. Grote Package Design Let s begin at the product level and the parts delivery mechanisms. Grote parts can be offered in three basic packaging formats: Bulk quantity without packaging (part number by -3 suffix) Polybag packaged product (no extension) Retail Packaging in carded or four-color boxes (part number by -5 suffix) Grote bulk packaging is identified by a -3 at the end of the standard 5-digit part number. This generally indicates that a full case is being shipped without further packaging to the distributor. Bulk packaging is used in shipping high usage products and in some Original Equipment purchases to ease the installation process and to reduce packaging costs. At option of the distributor this product is sold to the market in less than case quantity. The standard Grote polybag is a blue bag that has a see-through panel front and back. At the top of the bag is a printed area for the UPC, part number, and product description in English, French, and Spanish. The Grote polybag is generally considered a packaging type for the Heavy Duty market, but it is increasingly being accepted in the Traditional Automotive marketplace as well. In general, polybag packaging is less expensive to the customer than the -5 retail pack. Some slower moving products are packaged in a non-graphic color poly bag. Basic Grote retail packaging can be of several different types, but all are, with a few recent exceptions, indicated by a -5 suffix to the standard 5-digit part number. The retail pack can be a proprietary slide-lock pack, display box, window box, or clamshell. Grote has made significant efforts to make the clamshell and slide-lock packs as small as possible to make Plan-O-Gram (POG) setup flexible. There is usually a price premium for retail pack product in comparison to poly-bagged product. Like the polybag, the retail pack also contains descriptions in trilingual format. 2

3 In addition to the trilingual copy, another significant selling point/feature of the Grote retail pack is the inclusion of CAD drawings/line art to show exact measurement data (this allows the consumer to know that the part will absolutely fit before purchasing, reducing later returns) and feature and benefit data printed on the back of the cards/ package. This is a unique feature that few manufacturers offer. In-Store Merchandising In-store merchandising is one of the many benefits that Grote offers its customers. Whether you are a Heavy Duty customer that relies predominantly on delivery sales, or a retail location that depends on walk-in traffic, the Grote merchandising plan is an important element in the sales process. Grote s trilingual packaging is written in English, Spanish, and French. THE TOTAL PACKAGE FOR THE AUTOMOTIVE MARKET There is one piece of literature that best identifies the Grote merchandising sales approach. The Total Package Brochure identifies the six key elements that identify what Grote has to offer a typical automotive aftermarket distributor. The main takeaway is that the Grote sales process isn t about selling a light in a box, we offer a great deal more. This more is what separates the Grote line from our competitors such as Peterson and Optronics. The Total Package helps drive lighting sales through the jobber network. Step 1. Merchandising and Packaging: these items will be covered in-depth in this section. However, the main elements are our slide lock packaging and display boxes that allow customers to quickly take returns and put them back on the shelf to avoid stocking fees and increasing profits. 3

4 Step 2. Plan-o-Grams: Grote plan-o-grams (again covered in greater detail later) deliver stylistically comprehensive sales tools to allow jobber stores to boost profits through high yield inventory turns and impressive store sets. Step 3. Exclusive Product: we have many items that our competition just cannot match or offer. Our engineering and product development process is a significant sales benefit and needs to be addressed when dealing with price conscious buyers that try to compare us to our competition. Step 4. Literature and Catalog support: Our comprehensive catalog is full of product information to make the counterman s job as easy as possible. With full color photos, detailed line drawings, electrical/technical information with features and benefits, it is a salesman s best friend. We also have reams of other sales literature to help close the sale much of it available for quick download from the Grote website. Step 5. Know How training - our multi-award winning training program is unique in the lighting industry and is available for our customers and in turn our customers customer. This program is currently a two volume set that covers basics of electricity and troubleshooting. It is a certification program that includes hats, patches, and wall certificates. Step 6. Guaranteed Changeover Process - the detailed changeover process is covered by your local rep. He can outline the Total Package process for the customer. As you walk through these six steps it should be quickly apparent that the Grote program is more than the lamp in the box it s not the lights you sell, it s how you sell the lights. Six Elements: 1. Merchandising and Packaging 2. Plan-O-Grams 3. Exclusive Product 4. Literature and Catalog support 5. Know How training 6. Guaranteed Changeover Process DISPLAYING THE PRODUCT IN YOUR BRANCH OR STORE Step 1. How will the sale be created? Phone/Counter sales Delivery of parts (wholesaling) Walk-in traffic After the decision has been made as to what type of product packaging will be marketed, the next decision to be made is how to display the product for sale. Grote has options to satisfy practically any situation. Depending on the customer s instore merchandising strategy, you may want to use labeled bin boxes for the back warehouse area while using polybags, bulk product, or a retail pack POG in the front of the store. Grote has several options for merchandising products including: Bin Boxes - Bin boxes are the most common method for storing product in the back of the warehouse or in the front of the store when using a bulk set-up. Grote has two sizes of bin boxes: a small bin box (99920) and a much larger bulk bin box (00780) for storage purposes. Either of these options may be appropriate. 4

5 Retail Plan-O-Grams (POGs) - Grote uses Spaceman Suite Merchandising Services plan-o-gram software to create professional POGs for the storefront. Grote recently updated its POG offering to include a refreshed 4-foot, 8-foot, 12-foot, and 16-foot option. If your customer is looking to use the Grote retail packaging style, then one of these POGs will certainly be the right solution. The POGS can also be converted to poly bag and bulk offerings. If one of the pre-packaged solutions is not suitable, if there is enough time, a special POG can be designed to utilize existing stock and/or requirements a customer might have. Additional POGs for 3-foot sections, or end caps, are available for seasonal items. Polybag POGs are becoming more popular as well, and this product is suited for hanging on peg holes. Step 2. How to create and merchandise a customer s selling area If you are working behind the counter to merchandise the product on the shelves, please follow these recommendations: Product should be displayed in numerical order. Product should be placed in bin boxes close to eye level, with excess inventory placed in a well-labeled overflow carton on a top shelf or below the shelving - if there is space, it can be placed behind the bin box. Bin boxes should be clean and have excess labeling covered or removed to make it as easy as possible to see the product. The bin box should have easy to read labels with part numbers printed in black permanent marker on the front of the bin box. Often address-style labels are used, but they do not hold up in the harsh environments of a warehouse. If you choose to use labels, you must make sure they remain clear and easy to read. A bulk dump bin display can be used for promotional items or fast moving products. Many of the same steps will be in order when stocking bulk product or bulk-displayed polybags. Make sure the product is clean. Depending on the customer s interior storage and inventory procedures, there may be an excessive amount of dirt, grime, and brake dust in the storage area. You will need to spend some time cleaning up the product area whenever you stop into the customer location. If you are setting up a retail pack POG for a customer, keep the following tips in mind: Use the peg diagram to pre-set the peg hooks in the designated holes. Grote builds its standard plan-o-grams on the 00180, 4-foot gondola that has been offered for many years. If your customer is providing his own hardware, you will want to verify the measurements before you begin and then make the appropriate adjustments. Grote uses the same methodology as some of the fastest growing auto parts retailers when setting up POGs. Larger items are placed on the top row with associated product (replacement parts, for example) nearby; the smaller items are hung on the lower hooks. A waterfall display is a space saving plan for displaying product. Products are overlapped by a system of bars projecting out from the display to allow for overlapping of product. 5

6 Typically, it is easier to place the items on the peg hooks starting with the bottom hooks and working up. Try to avoid using the top row of peg holes to make it easier to insert the hooks. The peg diagram typically displays the right-hand hole of a two-pronged peg hook; this is done to allow maximum space and to let you move the hooks toward the left to condense when possible. It is not uncommon for customers to use what are known as waterfall racks. These layered components allow for more product to be displayed in a tighter area. It is often not as pleasing to the eye but Grote can accommodate this merchandising set up. If your customer wishes to use waterfall racks, this must be identified early in the custom plan-o-gram set up process. POG Plan-O-Gram POS Point Of Sale POP Point Of Purchase CREATING A POG In many cases you will be asked to create a POG from existing inventory or to make a recommended product offering. From a merchandising perspective, if you are unable to utilize an existing POG, you should keep the following ideas in mind: Heavy Duty Market What type of customer does the distributor serve? If it s a fleet/end user, make sure that their stock has the coverage that fleets demand in both Stop/Tail/Turn and Clearance/Marker product, as well as accessory needs. You can t sell what you don t have in stock. Make sure the inventory is suitable for the size of your customer base. Too often the distributors will find themselves special ordering one or two parts to complete an order. Make sure you have inventory. Use business intelligence purchase history reports, and fleet surveys to analyze inventory turns and reorder habits. New products The Grote marketing department spends a lot of effort and time to promote new products that we have at the fleet/end-user level. The distributor needs to carry the inventory to support product launch efforts. Recommended stocking levels are typically sent out to help the fleet judge their needs. Retail displays typically cater to public walk-in business. Traditional Distributors Custom Plan-O-Grams Grote offers many services to our distributor customers. One of those services is the ability to create custom plan-o-grams. As mentioned on page 4, Grote utilizes Spaceman Merchandiser software produced by AC Nielsen. This software allows the user to build plan-o-grams from a database and to place the product in a grid format onto a custom set up gondola (can include shelves and/or various style hooks and hangers). The process for having a custom plan-o-gram designed for your customer includes the following steps: LED lighting is usually preferred over incandescent. Identify the product that needs to be placed on the POG Identify and measure (to the.5 ) the type of gondola and space that will be allotted for the POG, it is sometimes helpful to know the brand of gondola 6

7 (Lozier for example). This includes, overall height, base height, width, notch measurement (the space between the notches that the shelves hang, side rails), peg hole spacing (typically 1 x 1 ), how many sections/ segments (12ft, but in three 4ft gondolas). Submit information to your local Grote rep. Grote Marketing will need a minimum of two weeks and depending on workload it could be 4 weeks or longer to finalize your custom POG. What type of customer does the distributor serve? Unlike heavy duty customers, traditional retail customers generally sell to a wider variety of consumers and as such need broad product coverage without a lot of depth. If a customer services a specific market segment (agricultural, for instance), make sure the products are in stock to meet those needs. LEDs Far too few of the traditional customer base is carrying sufficient LEDs in their standard product offerings. You should specifically made this a focus of the new POGs being offered. Grote displays are generated by popularity, profit, coverage, and new technology. In the traditional marketplace Grote has chosen to promote the Hi Count line of LEDs. In some instances you might use a longer warranty LED product, such as SuperNova, but in nearly all cases you will want to use the Hi Count line. RIGHT LAMPS FOR THE JOB Every year Grote produces a report of the top 100 best-selling parts from the previous year, compiled for both the Traditional and Heavy Duty markets. This report is the main tool you can use to identify the top selling parts to focus on with your customers.. Another way to select products to offer your customer or market is to check the movement code of the products located in the price sheet. A: Fastest moving items top movers for any market B: Next fastest moving items usually core products C: Steady moving items items that round out a complete product offering D: Limited sales items; based on demand or restricted to certain areas The right LED mix of product will instangly bolster sales dollars and market penetration. AA: Display items not subject to return or obsolescence protection DD: Special order items not subject to return or obsolescence protection. Additional lead times may be required (standard case only) W: Warehouse distributor or factory stock only, slow moving 7

8 DISC: Obsolete. Not subject to return after expiration of recall deadline N: Products used with another code to indicate that the item is new. Their activity index is estimated after a market test For the traditional market, the POG offering now is available in an 8, 12, and 16 store set (4 ft POGs are available on request). The percentage of LED SKUs to the total SKU count is: 8 : 20 LED SKUs out of 85 SKUs = 23% of the total offering 12 : 26 LED SKUs out of 115 SKUs = 22% of the total offering 16 : 30 LED SKUs out of 142 SKUs = 21% of the total offering One method to select the right mix of product is to look at the total value of the POG and the value of the sell-thru. Expect four turns per year on that inventory in the store. If the value of the POG is $1200 at the jobber level, then the jobber should expect $4800 in annual sales for sell-thru of the product. Also understand that the POG is a suggested mapping tool for popular items. It may not physically fit the area that the store manager gives you. Learn to adapt and work within the areas you have available. Stores may order a 12 display but only have room for 8 in the pegboard area. Look for areas on the pegboards behind sales/parts counters or shelves. You may be able to use the baseboard of the display to feature light kits and boxed items. The Dollar % total for LED product is typically 2x the Unit Sales %. Expect and manage four turn sell-thru on a product mix at a jobber store. POP (Point Of Purchase) In addition to Plan-O-Grams, Grote offers a wide variety of Point Of Purchase (POP) displays. The Grote POP is generally in the form of lighted displays showing the brightness, longevity, or design of the Grote lighting product. Typically, POP displays are included in customer assortments and tied to the order. The part numbers and pictures of available POP displays can be found in the back of the merchandising and POG book. When setting up POP displays, you need to work with the location manager to make sure they understand the potential dangers of lit displays that are not used properly or well maintained. Grote POP displays are manufactured with a high level of care and professionalism; however, if they are not properly maintained or their power supplies are not properly grounded, accidents can happen. Other POPs include a wide variety of counter mats, posters, and brochures. The literature can be found on the Grote Literature Brochure (GLB) order form available from you local Grote sales rep. 8

9 POS Point of Sale (POS) displays include spinning racks, dump bins, and counter top bins. Grote offers a wide variety of sales tools that allow your customers to display their product in an atypical POG fashion. If you have a branch that is unable to provide a full 4 feet of space or wants to set up a seasonal display, dump bins and spinner racks are a perfect solution. These items can also be found in the back of the merchandising and POG book. MERCHANDISING AND PRODUCT DOCUMENTATION Grote is constantly improving and introducing new documentation to support the sales process. As mentioned before, the GLB order form lists the available catalogs, marketing brochures, and sales tools available to order from the marketing department. However, the most efficient means to get up-to-date product data is located at The Grote website is brimming with valuable product data, including a live product catalog that is available 24 hours a day, 7 days a week. Downloadable data sheets are available at marketing/. There you or your customer can choose to print or download data sheets that show photos, line art, electrical data, plus features and benefits of the product. Electronic data interchange is also available. The Grote website is also a good source for identifying new products, promotions, press releases, and product photos. GETTING THE BUSINESS The final step in getting the business is setting up a plan to changeover the fleet, or jobber from a Grote competitor to a Grote supplier. Grote has a very detailed changeover program. The explicit details and paperwork should be worked out with your local Grote representative. If you have heard the expression, Plan your work then work your plan, you should know to map out your planned efforts when setting up the fleet storage and over-the-counter selling areas. You will need to know the number of bin boxes, small and large needed. Know if you have enough room for the new products, catalog requirements, etc. Coordinate with your Grote representative The Jobber store/branch selling area in the front needs peg hooks, number of gondola headers, POS materials in proper quantity, counter mats, posters, product displays, etc. Make scheduled calls at one week, one month, three months and six months for any questions your designated contact may have. 9

10 In terms of the merchandising effort, it is important to note that your changeover work is not complete until you have done the following things: Swept the floor, cleaned and straightened up the area around the Grote parts area, in front and back. Made sure there are catalogs available at the counter, in the back warehouse area (when permitted), and in the POG area. For fleets catalogs should be in storage/inventory. A call back or follow up visit is essential for every change over. Made sure the parts ordering computers have been loaded with Grote pricing and part numbers and that the proper interchanges have been completed to allow the counter personnel to order Grote parts instead of the competitive parts they previously ordered. The competitive inventory interchanged to Grote is in numerical order. Made sure that you have provided adequate and thorough training to the sales and counter staff on new Grote products, as well as the Grote part numbering system, catalog, and website. Identified a designated contact (store manager, fleet maintenance manager, sales manager, or counter manager) that you will be speaking with one week, one month, three months, and six months in the future. In those phone calls you will answer any questions and help with interchange problems and ordering /stocking issues they might be experiencing. This contact is a key piece of the Grote changeover experience because it helps ease a process that might be difficult for some members of the customer team. THE UPGRADE Our job is not complete when we get the successful changeover and the POG is set. It is the responsibility of the Grote sales person to follow up on regional issues that might be affecting the POG Agriculture sales for instance. It might be necessary to make changes to the individual store POG on a yearly basis to meet those regional needs. Every year during the business plan cycle you should look at the jobber POGs and identify areas for improvement, selection of new products and ways to increase the LED content. This must be done at lease once per year. In a fleet it might be necessary to update the fleet survey to account for new equipment added to the mix. New product launches should be a key part of your upgrade plan. 10

11 POG, POP AND POS EXAMPLES Below are additional examples of the types of plan-o-gram sizes and configurations, POP and POS. 4 4 Poly Bag 8 Custom Sizes

12 NOTES Counter-top bin box (54173) with product 4 position work lamp display (POD-001) Grote Select dump bin with header card (00781) ADDITIONAL RESOURCES These resources can be acquired online or through the marketing department. 12