Merchandising Categories

The complete range of merchandise at the store is divided into separate groups consisting of related products. Such groups are called categories. Each category is treated as a separate business entity. The retailer calculates the profit and loss of each category separately. Each category contributes in its own way to the profitability of the store. The retailer does not promote a single brand but the complete category. The concept of categories has gone a long way in developing a strong bond between the retailer and the supplier. The classification of products into separate category benefits the customers and makes their shopping a pleasurable experience. The customers as per their interest, pocket and need can walk up to the respective categories, check out the various options and decide what to buy and what not to buy.

The retailer must sort out the similar products which can be included in a single category. They must make sure that the products bear a strong connection with each other:

• Define the category
• Role of the formed category
• Evaluate the current performance of the category
• Decide on targets for the category
• Devise an overall strategy to promote the category
• Formulate specific steps to increase the sales of the category
• Implementation of the above steps
• Review and feedback