Opinion: Tackling Top Dealer Merchandising Questions

A picture of NTP-Stag merchandising director Val Byrd

As the NTP-Stag customer merchandising manager, I travel frequently to collaborate with our dealer partners to develop strategies aimed at improving their retail parts and accessories presentations. After 20 years in the industry, I am still passionate about marketing and merchandising, which has been nurtured by the positive results I have seen from our work.

Throughout the coming year, I am pleased to share my insights with you and answer your questions. This month, we received the following questions:

Q: How often should
I remodel my store?

The frequency that store resets must occur does not follow any strict rule, but most retail operations need a full or partial reset every five to seven years, just as a maintenance matter. Before I continue, I must clarify I do not mean “maintenance” as a way of cleaning up. Store conditioning (or cleanup) includes specific tasks that you should perform on a regular schedule, such as daily or weekly. Instead, the primary reason for a reset is to bring a store up to a current standard or even to correct an issue.

A typical store reset consists of replacing or repositioning store fixtures, refreshing the product mix, changing the merchandise location and adding new displays and point-of-purchase (P.O.P.) material. The ultimate goal is to make the retail space more interesting and maneuverable for the customer and to improve
retail operations.

Q: When should I replace my shelving?

From a financial standpoint, store fixtures such as racks and checkout counters are long-term assets that should last at least eight to 10 years. These are functional elements—vessels, or as I like to say, the plate on which the meal is served. The meal is the merchandise. From my viewpoint, the rack is always secondary to the object displayed. Shelving should enhance the retail environment, rather than distract from it.

Ultimately, replace shelving when it no longer meets the retail operation’s needs. Scratches, peeling paint or sharp edges are signs you should replace your racks. Perhaps the gondolas are so tall they block the line of sight across the store. Maybe they are too small or inadequate to display enough merchandise to present a reasonable display. The fixtures simply may not have the look you want in your updated space. As I said, shelving should be practical, but also consider color and style, as those features can add to the look and feel of the space.

Q: How can I drive impulse sales in my accessories store?

The most efficient method of boosting impulse sales is to develop a sales plan for high-traffic store areas, such as space near the checkout counter, the customer waiting area and the end caps. These locations, considered premium real estate, are exposed to more people than other store areas. Placing displays there is likely to generate customer engagement.

The ideal display products in these areas are consumable items, new products and seasonal items. For best results, an average-size RV store should change end caps monthly, or at least quarterly. Your loyal shoppers will memorize your store after a couple of visits, so making changes regularly will encourage browsing.

Q: I have a large number of obsolete parts in my store. How can I manage this problem?

The good news is this issue
can be fixed. The not-so-good news is resolving the issue will require a moderate amount of effort along with buy-in from your leadership team.

The process, also known as SKU rationalization, is a common strategy for managing the number of SKUs (stock keeping units) kept in a warehouse or shop. As in many other industries, available RV aftermarket products are at an all-time high. Test this theory by seeing how many black streak remover brands you can name, just off the top of your head.

I often refer to research published by the whizzes at Tata Consultancy Services. The research substantiates that “up to 35-40% of the total inventory in the average business is stuck in slow-moving, underachieving SKUs, whose collective contribution to sales is less than 5%.”

Read the last line again. That number is truly eye-opening.

The first step is to identify the “dog” items. Your point-of-sale (POS) system can help here. Most dealer management software programs feature a reporting function enabling you to pull canned reports to help with decision-making.

One key report is the gross margin report, which lists contributions for every SKU currently stocked in your store. Here, you will learn which items are contributing to your bottom line. Another important tool is the aged inventory report, which you can pull for a specific time period. This report shows which parts are
your artifacts.

The next step is to act. Mark these artifact SKUs as discontinued in your POS system, and move to the “disposal” step so you can address underperforming SKUs. If your list is large, start with the worst offenders and work your way up the list. While not necessary to “clean house,” starting is important.

Any products with discolored labels, distressed packaging and single items in stock should be pulled first. Severely discount these products and add them to your clearance table, or discard and remove them from the system. The process can benefit your department by increasing inventory turns, freeing capital invested in merchandise and simplifying off-season activities, such as physical inventory auditing and planning for distributor show buys. Although you may face opposition to change within your store, the SKU rationalization process is not a bad thing.

Q: Should my store layout strategy focus on my staff or my customers?

The first store layout consideration always must be your customers. Without consumers, the retail space has no purpose. The same statement applies to product mix and placement. Retailers succeed because consumers make purchases, then return again and again. That said, creating a customer-centric retail presentation with built-in staff efficiencies is certainly possible.

For example, a grid-style layout is pleasing for the shopper and is the most effective dealer space use. Similarly, a centrally located checkout counter provides the parts associate better access and a clear sales floor view. Location can provide convenience and improve loss prevention. Centering a checkout counter also brings the shopper closer to the employee, which can enhance the customer service impression. The two options are not mutually exclusive.

Val Byrd is the manager of customer merchandising for NTP-Stag. She has worked in the RV aftermarket the past 20 years and is a leading RV retail expert on store layout/design and aftermarket product display. Previously, she worked in the grocery industry as a retail manager, buyer and promotions manager.

503-570-0171 ext. 2289  |  [email protected]

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