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05/03/23
Amit Kumar –Business Development Partner
PROMOTING
PRODUCTS
PRICING
PLACEMENT
CATEGORY MANAGEMENTINVOLVES BUILDING A BUSINESS PLAN AROUND THE 4 P’S
Objectives Review Objectives & Agenda Category Management Overview
Why Category Management? What is Category Management?
Implementing Category Management Core Components
StrategyBusiness Process
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Agenda -- Continued Enabling Components
Organizational CapabilityInformation TechnologyCollaborative RelationshipsScorecard
Benefits of Category Management
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Agenda -- Continued The Strategic Category Business
Process Corporate Strategy Category Definition Category Role Category Assessment
Assessment Worksheets Category Profitability
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Agenda -- ContinuedCategory Management Strategies
Category Management Tactics Assortment Tactics
Assortment ChoicesCategory Role LinkageAssortment AnalysisAssortment Assessment Worksheets
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Agenda -- Continued Pricing Tactics
Pricing Choices Category Role Linkage Pricing Analysis Pricing Assessment Worksheets
Promotion Tactics Promotion Choices Category Role Linkage Promotion Analysis Promotion Assessment Worksheets
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Agenda -- Continued Shelf Presentation Tactics
Shelf Presentation ChoicesCategory Role LinkageShelf Presentation AnalysisShelf Presentation Assessment Worksheets
Integration Into Strategic Category Plan Strategic Category Planning
Worksheets05/03/23
Why Category Management? Consumer Trends
Complex consumer demographics Population growth rates have declined
Competitive Pressure New store formats
Warehouse clubs & mass merchandisers New product introductions
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Why Category Management? -- Continued Economic Considerations
Slow growth economy & low interest rates Companies pressured to improve financial
performance Industry Capability
Shared business goals -- Focus on Consumer Shifting from internal optimization to maximizing
consumer value Trading Partner Alliances
Leveraging of resources between trading partners
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Why Category Management? -- Continued Empowerment
Authority & accountability to front-line managersPricingProcurementPromotion
Information Technology Distributors & Suppliers share data
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Category Management & ECR ECR (Efficient Consumer Response)
creates an environment and tools which enable the distributor & supplier trading partners to work collaboratively to deliver superior value on the products and services they offer consumers
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Category Management & ECR -- Continued
Category Management key component of ECR Provides strategic framework, business
process and organizational framework within which collaboration takes place
Profound impact on each of the four ECR strategies Efficient promotion Efficient Replenishment Efficient Product Introductions Efficient Store Assortments
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Definition Category Management is a
distributor/supplier process of managing categories as strategic business units, producing enhanced business results by focusing on delivering consumer value.
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Basic Principles of Category Management Categories are managed as strategic
business units Categories are managed strategically
through category plans and strategic roles
Category Managers control their share of company assets
Asset Returns measure performance and establish priorities
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Basic Principles of Category Management -- Continued Responsibility for category
performance/ownership is clearly defined and not fragmented across organization
Category Management leverages distributor and supplier expertise for mutual benefit … neither party can do the job alone
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Six Components of Category Management
Core Components (essential) Strategy Business Process
Enabling Components (assisting) Scorecard Organization
Capability Information
Technology Collaborative
Relationships05/03/23
Strategy Categories are strategic business units Overall company strategies provide a
infrastructure for category level strategies
Strategies must be clearly understood throughout the Retailer’s organization
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Business Process A formal, disciplined set of activities
designed to produce a specified output Development and implementation of
Written Category Business Plans
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Scorecard A tools that defines, measures and
monitors the progress of Category Business Plans
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Organizational Capability Development of the organization’s core
competency Through organizational structure Roles/Responsibilities Skill/Knowledge development Reward Systems
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Information Technology Critical elements of the Category
Business Planning Process Need data-driven, fact-based analysis and
performance measurement
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Collaborative Relationships Relationships with suppliers who acquire
unique perspectives, resources and skills Common objective -- delivering superior
consumer value more profitability
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Distributor vs. Supplier (Overlap & Differentiation)
Supplier (Manufacturers & Brokers) STRATEGY INFO TECH ORG. CAP. SCORECARD
Distributor (Wholesalers & Retailers) STRATEGY INFO TECH ORG. CAP. SCORECARD
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Category Definition
Category Role
Category Assessment
Category Scorecard
Category Strategies
Category Tactical Plans
Implementation Plan
Cat
egor
y R
evie
w
The Strategic Planning Process
CATEGORY MANAGEMENT PROCESS
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Category Definition The trading partners need to define the
new category with a name What is it? What are the sub-categories?
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Category Role The distributor (with supplier input)
would define the overall role the selected category is going to play in the distributor’s total business How important is the category? How to leverage the importance?
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Category Role -- Components Destination
To be the primary category provider and help define the retailer as the store of choice by delivering consistent, superior target consumer value
Routine To be one of the preferred category
providers and help develop the retailer as the store of choice by delivering consistent, competitive target consumer value
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Category Role -- Components Continued Occasional/Seasonal
To be a major category provider, help reinforce the retailer as the store of choice by delivering frequent, competitive target consumer value
Convenience To be a category provider and help
reinforce the retailer as the store of choice by delivering good target consumer value
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Category Assessment Comprised of accumulation of all
appropriate consumer, distributor, supplier and competitor data for analysis relative to opportunities represented for the category chosen How is the category doing? Versus Potential? Versus Goals?
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Scorecard Establishment of the performance
measures by which the category manager will measure the quality of the execution of the plan What are the goals & objectives? How is the progress?
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Category Strategies Assignment of specific strategies to key
elements of the overall category What is the business plan? How will it achieve the role & scorecard?
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Category Strategy - Components Traffic Building
Consumer Draw Transaction Building
Increase the Register Ring Profit Generating
Improve Category Gross Margin Turf Protecting
Defend Sales and Share (other formats)
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Category Strategy -- Components Continued Cash Generating
Increase Category Cash Flow Excitement Creating
Generate Sense of Urgency & Opportunity Image Enhancing
Reinforce Retailer’s Desired Image
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Category Tactics Specific activities supporting the
category strategies which would include item variety, everyday and feature price targets, shelf presentation, etc. What do we do to achieve the strategy? Who does what?
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Category Tactics -- Components Assortment Pricing Promotion Shelf Presentation Product Supply
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Plan Implementation Key Components of Plan Implementation
Approval Process Strategic Fit Scorecard Impact Resource Allocation Impact on Other Areas
Assigning Responsibilities Scheduling
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Category Review Ongoing review and measurement of the
progress of the plan toward the category role and scorecard, and modification of the plan when appropriate
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Conclusion The Staples & Grocery Retail industry is
in a major state of transition. This change is a function of a complex mix of consumer, technological and market factors.
Category Management represents a business oriented approach to achieving business results -- both for distributors and suppliers
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Thank You
[email protected] ,[email protected]://hand2handsolutions.webs.com/index.htm
Contact +91-9818995422,09785641086
Grow with Growing Industry
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