PPT 18-1

5th Edition5th Edition

PPT 18-2McGraw-Hill/IrwinLevy/Weitz: Retailing Management, 5/e Copyright © 2004 by The McGraw-Hill Companies, Inc. All rights reserved.

Store Layout, Design Store Layout, Design and Visual and Visual

MerchandisingMerchandising

Chapter 18Chapter 18

PPT 18-3

Managing the Store

Store Management

Layout, Design andVisual Merchandising

Customer Service

PPT 18-4

REI’s Store Environment

PPT 18-5

Store Design Objectives

• Consistent with retailers image and strategy

• Positive influence on customer satisfaction and purchase behavior

• Cost effective

• Flexible

• Meet needs of disabled

PPT 18-6

Tradeoff in Store Design

Easy of locating merchandise for planned purchases

Exploration of store, impulse purchases

PPT 18-7

Types of Store Layouts

• Grid

• Racetrack

• Free Form

PPT 18-8

Grid Layout

Long gondolas in repetitive pattern.

• Easy to locate merchandise

• Does not encourage customers to explore store

– Limited site lines to merchandise

• Allows more merchandise to be displayed

• Cost efficient

Used in grocery, discount, and drug stores. Why?

PPT 18-9

Grid Store Layout

Fruit

Vegetables

Office & customer service

Books, magazines, seasonal display

Rec

eivi

ng

& s

tora

ge

Exit

Entrance

Cart area

Checkouts

PPT 18-10

Racetrack Layout

Loop with a major aisle that has access to departments and store’s multiple entrances.

• Draws customers around the store.

• Provide different site lines and encourage exploration, impulse buying

• Used in department stores

PPT 18-11

JCPenney Racetrack Layout

PPT 18-12

Example of Race Track Layout

PPT 18-13

Free-Form (Boutique) Layout

Fixtures and aisles arranged asymmetrically

• Pleasant relaxing ambiance doesn’t come cheap – small store experience

• Inefficient use of space

• More susceptible to shoplifting – salespeople can not view adjacent spaces.

Used in specialty stores and upscale department stores

PPT 18-14

Free-Form Layout

Storage, Receiving, Marketing

Underwear Dressing Rooms

Checkout counter

Clearance Items

Feature Feature

Jean

s

Cas

ual

Wea

r

Sto

ckin

gs

Acc

esso

ries

Pan

ts

Top

sT

ops

Ski

rts

and

Dre

sses

Hat

s a

nd H

andb

ags

Open Display Window Open Display Window

PPT 18-15

Example of Boutique Area

PPT 18-16

Display Areas

Feature areas

– End caps

– Promotional aisle

– Freestanding fixtures

– Point-of-sale areas

– Walls

PPT 18-17

Designing a Webpage: Lessons from Store Design

• Simplicity matters

• Getting around

• Prioritize

• Design layout based on what you want to accomplish

• Follow the standards of the industry leaders

PPT 18-18

Space Planning

Allocating floor/shelf space locating merchandisein store (or on website)

Where should merchandise be displayed?

How much space should be allocated to each category/item?

How many items of each SKUs should be displayed?

PPT 18-19

Space Planning Considerations

• Profitability of merchandise

• Customer Buying considerations

– Impulse products near front

– Demand/Destination areas off the beaten path

• Physical characteristics of product.

• Complementary products should be adjacent

• Sales rate

– More units of faster selling merchandise need to be displayed

PPT 18-20

Prime Locations for Merchandise

• Highly trafficked areas

– Store entrances

– Near checkout counter

• Highly visible areas

– End aisle

– Displays

PPT 18-21

Special Considerations

• Avoid the “butt-brush” effect.

• Make merchandise accessible.

• Allow a transition zone.

PPT 18-22

Visual Merchandising

PPT 18-23

Visual Merchandising

PPT 18-24

Visual Merchandising

PPT 18-25

Visual Merchandising

PPT 18-26

Visual Merchandising

• Visual Merchandising.

• Seven Colors Group

PPT 18-27

Financial Comparison Report for Existing & Proposed Salad Dressing Planogram

Brand

Gross Margin

Per Week

Sales

Per Week

Unit Sales Per Week

Inventory Turnover

Section: Salad Dressing current

1. 7SEAS $50.33 $273.68 222.00 35.52 2. HV RANCH 26.01 165.13 90.80 22.59 3. KENS STK 46.76 330.14 266.00 27.61 4. KRAFT 59.83 336.42 238.00 23.48 5. NWMN OW 32.63 186.06 114.00 34.87 6. PRS CHOI 27.88 122.18 82.00 59.22 7. WLD FRMS 20.80 109.85 65.00 45.07 8. WSHBN _102.76 __590.03 __431.00 25.73 TOTALS $367.00 $2,113.49 1,508.80 28.53

PPT 18-28

Brand

GrossMargin

Per WeekSales

Per WeekUnit SalesPer Week

InventoryTurnover

Section: Salad Dressing revised

1. 7SEAS $50.33 $273.68 222.00 35.522. DUNNE 6.97 46.20 44.00 26.002. HV RANCH 26.01 165.13 90.80 22.593. KENS STK 46.76 330.14 266.00 27.614. KRAFT 58.40 336.42 229.00 27.135. NWMN OW 32.63 186.06 114.00 34.876. PRS CHOI 27.88 122.18 82.00 59.227. WLD FRMS 20.80 109.85 65.00 45.078. WSHBN _102.76 __590.03 __431.00 25.73TOTALS $367.54 $2,150.24 1,543.80 29.19

Financial Comparison Report for Existing & Proposed Salad Dressing Planogram

PPT 18-29

Brand

GrossMargin

Per WeekSales

Per WeekUnit SalesPer Week

InventoryTurnover

Net Change

1. 7SEAS $0.00 $0.00 0.00 0.002. DUNNE 6.97 46.20 44.00 26.002. HV RANCH $0.00 $0.00 0.00 0.003. KENS STK $0.00 $0.00 0.00 0.004. KRAFT ($1.43) ($9.45) -9.00 3.645. NWMN OW $0.00 $0.00 0.00 0.006. PRS CHOI $0.00 $0.00 0.00 0.007. WLD FRMS $0.00 $0.00 0.00 0.008. WSHBN $0.00 _$0.00 0.00 0.00TOTALS $5.54 $36.75 35.00 0.66

Financial Comparison Report for Existing & Proposed Salad Dressing Planogram

PPT 18-30

Evaluating Space Productivity

Productivity ratios are output/input

– Sales per square foot

– Sales per linear foot

– Gross or contribution margin per square foot

PPT 18-31

Merchandise Presentation Techniques

• Idea-Oriented Presentation

• Style/Item Presentation

• Color Organization

• Price Lining

• Vertical Merchandising

• Tonnage Merchandising

• Frontal Presentation

PPT 18-32

Types of Apparel Display Fixtures

Straight Rack

Rounder Four-Way

Gondola

PPT 18-33

Straight Rack

PPT 18-34

Rounder

PPT 18-35

Four-Way

PPT 18-36

Gondola

PPT 18-37

Creating a Store Environment

Color

Scent Music

Lighting

Store Atmosphere

PPT 18-38

Visual Communications

• Coordinate signs and graphics with the store’s image.

• Inform the customer.

• Use signs and graphics as props.

• Keep signs and graphics fresh.

• Limit the copy of signs.

• Use appropriate typefaces on signs

• Create theatrical effects.

PPT 18-39

Lighting

• Highlight merchandise.

• Structure space and

capture a mood.

• Downplay features.