What is Planogram in Retail?
In the retail industry, a planogram is considered as one of the visual merchandising tools. It is a diagram/model indicating the placement of retail products to be displayed on shelves as part of the efforts to maximize sales. An effective planogram can be measured by the sales volume generated from the specific diagrammed area.
These days, many retail stores use text and box-based planograms to optimize shelf space, inventory turn, and profit margins. Usually, the design of a planogram will depend on the types of brands or products. Most apparel brands will focus on the presentation thus, use pictorial planograms to illustrate the appearance and the brand image for each product.
How Planogram Works
A planogram is a solution to a business’ visual merchandising needs. It is usually useful for big-box retailers or grocery tools with many products and product categories from many suppliers. However, it always depends on the retailer himself. A smaller store with fewer products and displays usually do not use a comprehensive planogram. On the other hand, a bigger store with many products needs a comprehensive planogram to easily identify the location of the products. A planogram brings essential benefits for a business’s visual merchandising, particularly to plan out your store layout. Generally, a planogram provides two main advantages: maximizing sales and spaces.
Besides the two main advantages, planograms also provide many other advantages, including:
- Maximizing selling potential of every corner of the spaces in the retail stores
- Satisfying customers with a better visual look
- Reducing out-of-stock and tightening inventory control
- Making it easier for product replacement by store staff
- Helping in positioning-related products
How to Create an Effective Planogram
Using a planogram helps to maximize sales and space. There are several options you can consider to use effective planogram, including:
1. Hire an expert
In the retail industry, there is a professional planogrammer that can help you to use effective planogram. In the United States, a planogrammer is paid a $47,000 annual salary. The amount will depend on which area you are located in. However, if you cannot hire a planogrammer, you can allocate this responsibility to a visual merchandiser.
2. Consult with planogram experts
Another effective way you can consider to create an effective planogram is by hiring third- party experts who can use their skills to design your planogram. Some companies are specializing in using behavioral research to assist in visual merchandising. These companies usually provide consulting and software to help you plan your planogram.
3. Use Planogram Software
If you cannot afford to hire a planogrammer and third-party experts, you have another option: use planogram software. There are many planogram software on the market that you can choose based on your special needs and budget. If your budget is tight, you can try free planogram software.
Generally, planograms are useful tools in visual merchandising that can increase sales and spaces. It ensures that the most searched and profitable products are displayed in the right location and look as appealing as possible to customers.
