category definition group 1
TRANSCRIPT
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Submitted by:
Ashim
Ambrish
Deepshikha
Deepmala
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men's c s ls irt
woven knitted
combination
( wovenandknitted)
Category definition
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woven
printed
otton linen wool
solidsYarn-dyed
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cotton
Slim Regular
Apple hem-line
Straighthem-line
With slits
With collars
Flat rolll
Half sleeves Full sleeves
Doublecuffs
Single cuffs Loop
Mandarin Detachable
Withoutcollars
Without
slits
Regular
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Yarn dyed
checks
gingham madras
stripes
horizontal vertical diagonal
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knitted
knitted
singlejersey
singlejersey
interlock
interlockdouble
knit
doubleknit
pointelle
pointelle pique
pique
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single jersey
cotton
round neck
half sleeve
solids sku's
printed
digital
rubber
heat
transfer
yarn dyed
checks
stripes
embroidered
full sleevev-neck
boat neck
y neck
flat rollcollar
polyester
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Basket analysis
Frequent shopper data
House-hold panel data
Point of sale data
Occasion analysis
Fair share and demand gapping
Financial analysis
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Destinationcategories
Large dollarsalesHighhousehold
penetrationHigh purchasefrequencyDifferentiatedfromcompetitors
Preferredcategories
large dollarsalesHighhousehold
penetrationHigh purchasefrequency
Conveniencecategories
Average dollarsalesAveragehousehold
penetrationInfrequentpurchaseswithin aparticularstore.
Occasionalcategory
Seasonal oroccasional
dollar salesAveragehouseholdpenetrationSeasonal oroccasionalpurchasefrequency.
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Destination categories Knitted ; single jersey ;printed shirts
Rubber print
Heat transfer
Digital print
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Woven ; printed
Digital
Screen
Rubber
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Preferred categories
Woven; regular fit; slim fit ; flat roll collared ;
solids
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Woven; regular fit ; yarn dyed; stripes
Horizontal
Vertical
Diagonal
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Knitted ; single jersey ; solids
Knitted ; single jersey; yarn dyed; stripes
Horizontal
Vertical
diagonal
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convenience categories
woven ;slim fit; apple hemline; yarn dyed; checks
gingham
madras
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knitted ; Pointelle ; pique;
boat neck
y neck Flat roll
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woven ;slim fit; collar
mandarin
detachable
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Occasional/ Seasonal:
woven ; slim fit ; embroidered
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Involves the development of marketing strategies
for the category.
Category marketing strategies can be classified intothe demand-chain and supply-chain strategies.
The demand-chain strategies are targeted at traffic,profit, transaction, image, turf,cash and Excitement
The supply-chain ones focus on merchandise flowand transaction cost
One of the tools that retailers can use is the growthshare matrix : Each of the category needs to beplotted on the basis of its sales growth and share inthe total business.
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Woven
arndyedc ecks
Knitted c ecks
Woven slim fit
mandarin,detac
ablecollar
Woven solids
Wovenyarndyedstripes
Knitted single jerseysolids andyarndyed
Wovenembroidereds irt
Knitted single jersey;printed s irts
Marketshare
Marketgrowth
low high
low
high
sleepers winners
Questionables Morning star
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Once the strategies for the category have been
selected, the next step is to determine the
assortment
pricing,
promotion,
shelving and
supply-chain tacticsrequired to ensure that the strategies Work.
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Assortment tactics
Style Roundneck
Flat roll collar V- neck Boat neck
construction Woven
/knitted
Woven /knitted Woven /knitted Woven /knitted
Prints Digital
/rubber/heat
transfer
Digital /rubber/heat
transfer
Digital
/rubber/heattransfer
Digital
/rubber/heattransfer
iber
composition
otton/li
nen
otton/linen otton/linen otton/linen
colors Green
/red/white
Green/red/white Green/red/whit
e
Green/red/whit
e
sleeve Half/full Half/full Half/full Half/full
size S,M,L,XL S,M,L,XL S,M,L,XL S,M,L,XL
SKUs 288 units 288 units 288 units 288 units
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Create as many as sub-categories as possible to
increase opportunity
Add club packs as necessary
Create high quality private label
Maximum Variety vs. Market
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Pricing tactics
Top 10 SKUs below lowest competitor everyday
Shelf presentation
Prominent aisle location
Located at the back of thestore
Vertical color blocking
Destination category
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Promotion
Match competitors if they are aggressively
promoting
Avoid out of stock
Feature and display 52 weeks a year
Direct mail advertising
SMSes
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Assortment tactics
style solids stripes
design plain Horizontal/v
ertical/diagonal
construction Woven/
knitted
Woven/
knitted
colors White /
purple/
green /red
green/
white/
purple/red
sleeve Half/full Half/full
size S, M , L, XL S,M,L, XL
SKUS 64 Units 128 units
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Broad variety
Decrease the number of national brands and
eliminate sizes that have relatively low volume.
Create high and low quality private labels
Equal Variety versus Market
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Pricing tactics
Top 20 SKUs equal to lowest competitors
everyday
Shelf presentation
Large section Side wall of the store
45 customer sightline
PreferredcategoryPreferred category
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Promotion Tactic
Match competition if they are aggressively
promotingFeature & Display 26 weeks a year
Newspapers
Direct mail
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Assortment tactics
STYLE CHECKS MANDARIN
BOAT Y-NECK FLATROLL
Construc
tion
woven woven knitted knitted knitted
Colors Green/white/red
/purple
Green/white/red
/purple
Green/white/red
/purple
Green/white/red
/purple
Green/white/red
/purple
Design Gingham
/madras
Plain/stri
pe
Plain/stri
pes
Plain/stri
pes
Plain/stri
pes
Sleeves Half/full Half/full Half/full Half/full Half/full
Size S,M,L,
XL
S,M,L,
XL
S,M,L,
XL
S,M,L,
XL
S,M,L,
XL
SKUS 64 Units 64 units 64 units 64 units 64 units
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Assortment tactics
Decrease assortment by avoiding redundancy Prune low profit/ low volume items
Create lower quality private label for high volume itemsif economic return can be shown.
Pricing tactic
Never use items for EDLP
Raise prices to increase marginsConveniencecategory
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Shelf presentation Decrease space allocated to the category
Place high margin items in prominent positions
Do not display category
Do not feature category in ads
Promotion tactic
Promote only budget buys where margin is high on promotion
Limit promotional pass through
Signs both internal and external to the store
Informative in-house displays of merchandise
Conveniencecategory
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Assortment tactics
Time varietystyle embroidered basic
constructi
on
woven W
oven/knitted
Fibre
composition
Cotton/linen/
wool
wool
colors Green/red/wh
ite/purple
Green/red
/white/pur
ple
size S,M,L,XL S,M,L,XL
Sleeves Half/full Half/full
SKUs 96 units 64 units
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Pricing tactics No
n-inflammatory
Raise price points where possible
Below average operating Expense during non peakperiod.
Shelf presentationMinimum space requiredAvoid using major displaysUse shelf talkers to push more profitable items
Promotion TacticDecrease promotional frequencyUse of flyers
In store promotion
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Category
Subcategory
Segment
Brand
SKU
Distributor
Contribution
And productivity
Market
Market share
And
benchmarks
Consumer
Buyer profile and
Purchasebehavior
Supplier
Share andefficiency
Category assessment from four perspectives
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Economic Performance
It includes the profit generation by the categories
based on sales, inventory, space, and people. It also encompasses the assessment of the
performance of suppliers and the processes
employed by the retailers for managing the
categories.Perceptual performance
It includes the assessment of the perception of
customers in terms of their roles in creating a store
image and patronage.
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Gross Margin Return on Inventory (GMROI)
= Gross margins
Average Inventory @ Cost
used to evaluate departments, merchandise
classification, vendor lines, and items.
compares and evaluates departments with
different margin/ turnover profiles.
Items with higher GMROI are allocated more
space.
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Sales-to-stock ratio:
= net sales
average inventory at retail
The Inventory turnover ratio:
= COGS
Average Inventory @ Cost
Gross Margin return on Floor Space:
= gross margin
space providedGross margin return on Persons employed:
= gross margin/ persons employed
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Assumptions Size of store is 1000 sq ft
No. of employees working in the store is 20
No. of SKUs is 4512
Total sales= 3000 Total sales : Rs 30,00000
Destination category constitutes(7%) : 316
Preferred category (60%): 2707
Convenience category(20%) :902
Seasonal/occasional category(13%): 587
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Size of store is 1000 sq ft
Non selling area ( 8%) : 80 sq ft
Selling area : 920 sq ft
destination categ
ory (7%) :70 sq ft
Preferred category ( 60%) : 600 sq ft
Convenience category ( 20%) : 200 sq ft
Seasonal / occasional category ( 5%) :50 sq ft
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Destination :knitted =Rs 799 Rs 1499
woven= Rs 1499- Rs 2499
Preferred : knitted= Rs 699 Rs 1199
woven = Rs 1099- Rs 1199
Convenience : knitted = Rs 599 Rs 999
woven = Rs 799 Rs 1099
Seasonal/
occasi
onal: Rs 799 Rs 1999
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Sr. No. Particulars Amount Per Unit (Rs.)1 Retail Price s 799
2 Cost of goods 559
Gross margin (30%) 240Discounts and allowances3 Cash discount 10
4 Merchandise allowances 10
5 Others 5
Total 25Adjusted gross margin 215Direct distribution costs7 Warehouse space 0.58 Warehouse handling 1.0
9 Warehouse inventory costs 2.0
10 Transportation to store 1.011 Store space costs 3.2
12 Store inventory costs 4.0
13 Store handling costs 6.0
Total Direct product cost 17.714 DPP 197.3