A strong retail strategy is the foundation to a successful consumer goods business, but in order for a business to truly maximize its success, this retail executive strategy must be closely followed by both the field reps and the retailer. Merchandising audits provide regular check ups on retailers, ensuring that they are complying with the agreements that you have made. These are the things you should know when field reps are performing their audits:
There are two basic categories of visual merchandising audits: shelf audits and seasonal/promotional audits. Shelf audits ensure planogram and pricing compliance while seasonal/promotional audits ensure that special promotion items are displayed and priced correctly. When performing shelf audits, there are several things the field rep should look for:
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In-Store Location: Is the product in the correct part of the store, as agreed upon with the retailer? This location should have been set during initial negotiations, so make sure that your products are in the right place.
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Shelf Position: Take note of the adjacent products. Knowing where your product is in relation to other products gives you a better idea of what type of marketing to use to compete with these neighboring brands.
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Facings: Studies have shown that a doubling of facings leads to a 20% increase in sales. You can choose to purchase more facings for your brand, but you should carefully weigh the cost of these extra facings with the projected increase in sales before making a decision.
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Product Holes: Are there open spaces on the shelf where your product should be? Check if those products are out of stock or if the retailer hasn’t restocked the shelf yet and the products are still in the back. Be proactive to ensure that these product holes are taken care of.
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Out of Stock: This is one of the most important things your field rep should be looking for while auditing. OOS causes major issues for distributors and retailers alike, and can result in a loss of up to of $75,000. It is vital to keep an eye on the availability of your products in order to prevent OOS, and audits can help you collect data to better predict and prevent OOS.
In addition to the usual shelf audits, the field rep may also need to perform seasonal and/or promotional audits as well. The things to look out for during these audits include:
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In-store Signage: In any promotion, awareness is the initial phase. It is important that customers know about the sale. If you paid for in-store signage, then you should make sure that it is optimally placed and is broadcasting the sale to the majority of customers.
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Special Ads and Displays: Once customers are aware of the sale, they should know where in the store to find the products, as well as what products are part of the sale. Displays are important especially at the point-of-purchase because they play a large part in consumer purchasing decisions.
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Seasonal/Promotional Pricing and Labels: If there is a disparity between what your sales promotions claim and what the pricing labels say, customers will not only be confused, but upset as well. This can result in lost sales if not quickly fixed.
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Employee Knowledge: This is perhaps the hardest aspect to measure but is important during promotions, as customers will typically ask the salesperson more specific questions. Therefore the employees can help boost your sales or cause you a loss in sales, depending on the extent of their knowledge.
Finally, the field rep should take note of the general appearance of the store, taking into consideration the cleanliness and overall condition. This is important because unsafe store conditions or haphazard stores may deter customers from returning or even staying in the store long enough to make a purchase.
With these points in mind, you can ensure that you are maximizing the benefits of your merchandising audits and providing your business with the keys to success.
