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Facts About Planograms That Every Retailer Must Explore

By on April 22, 2013 — Updated on September 8, 2013

Planogram refer to a schematic representation of a retail store. The diagram shows the best possible placements of the items that ensure maximum sales. Planograms are often termed as POGs and these diagrams depict the layout of a retail store.

Hence these diagrams have become an important part of strategic planning and development of the retail industries around the world. Specially it’s considered as the most important part of visual merchandising. Almost all leading brands hire high quality R&D professionals to prepare a complete layout of their retail store plan.

Planogram in Retail: why it is important in retail industry?

Retail industry predominantly uses the concept of planograming. They have been using the concept since a long time. Depending on the type of business, products and stores, these diagrams may vary. These diagrams are considered as highly specific and powerful indicators. Sales volume of a specific product in a superstore or retail chain shop reflects the efficiency of a planogram.

Fast moving consumer items and related retailers focus on preparing planograms with text and box-predominant to ensure proper space optimization, inventory management and profit margins. In the other hand, apparel retailers and manufacturers pay more attention to visual representation of the products to be sold to ensure better illustration and identification.

Depending on the market requirements, planning and business strategies, the planograms are prepared using few basic concepts and theories. Visual products are placed according to horizontal, vertical or block placement theories whereas commercial placements primarily depend on market share and margins.

These planograms are known for their major functions which are termed as derivative targets in retail industries. These derivative targets are fixed by the researchers and retail leaders around the world. These targets play crucial role in merchandising and hence considered as the backbone of planogram in retail.

  • Maintenance, communication and setup of the merchandise
  • Efficient inventory management
  • Effective use of space and other infrastructural resources
  •  Facilitating proper mapping and planning of a retail store

Planogramming software: automating the complex procedure

Usually, the larger retailers hire retail professionals and expert planners to prepare these diagrams. After researching the market shares and other important factors, the experts prepare efficient visual representation of the products placed in a superstore.

However, the leaders in retail industry have started thinking about automating the process. They have started investing in software that can prepare planograms easily without experts. These software tools need exact data, facts and figures to prepare something very professional and highly effective.

There are literally hundreds of software tools available today. Among those, a few have become extremely popular and almost all retailer leaders are using those tools frequently.

RetailSmart is actually a firm that has developed a efficient tool for preparing planograms instantly depending on the data input. Another popular software is Capture Plan. Shelf logic and SmartDraw are also becoming very popular these days. These tools are developed by expert software developers and retail experts and they ensure exact precision that every retailer looks for!

The concept of planogramming is being used since a long time. This was a concept exclusively used by the market leaders and large chain retailers even a few decades back. But today, things have changed a lot and automated planogramming has made things a lot easier. Today, even the small, new retail brands are using the concept efficiently.

Image: By Vic 1976 (Own work) [GFDL or CC-BY-SA-3.0-2.5-2.0-1.0], via Wikimedia Commons

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