One-Page Guide to Solving Your Category Management Problems
Category Management Definition: Managing Product
Categories as Business Units to Satisfy Customers Needs.
“Find out what the Customers want and give it to them”.
Category Management the pre-eminent technique used by leading retailers and suppliers to deliver their retail strategy and develop new products.
Category Definition: Base the category on the grouping of like products that the customer expects to see in the store displayed together and in which a meaningful choice can be made. Example, Canned Fruit not Canned Goods.
Sub Category Definition: Divide the category further, based on product types that the customer can relate too based on the customer decision making hierarchy. Example,
Canned Peaches, Canned Apricots not by brand.
Product Group Hierarchy: Have at least 5 levels, up to 10 if possible. Start at the top with the basic groupings that are displayed together. Example, Hypermarket Food Groupings,
Grocery 1, Grocery 2, Beers Wines Spirits, Health and
Beauty, Household, Fresh Food, Frozen Food. Split these further down into Categories, Sub Categories, Product
Groups and Sub Product Groups based on how the customer perceives them and your Category definitions.
Product Data Reports: Construct data reports for each
Category based on the Product Group Hierarchy. For each product show sales, profit, movement for last year and year on year growth. If you have different store formats or differing regional sales then show format and regional sales.
Adjust each figure for the number of stores stocking the product and its availability during the year.
Market Research: For each Category you need to know what’s happening in the market and each sub sector, what’s growing, what’s declining, new developments, what your competitors are doing, growth rates and make a projection
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