Market Feature: Merchandising Savvy Moves Chemicals And Additives
Chemicals and additives are generally a discretionary purchase, so you have to work at selling in this product category, but it is also a product category that responds well to proactive merchandising efforts.
To maximize your efforts, you must focus on creating a demand through effective merchandising techniques, particularly if you are upselling this category with top-of-the-line brand products. Basic merchandising rules are well proven, but often neglected in many stores.
However, even small steps in making the showroom environment more appealing, such as making it easier to find things, will drive an increase in business.
A knowledgeable staff is critical to success
The key in any consumer purchase area is to have well-trained, knowledgeable staff. Jobbers should work closely with manufacturer’s reps to ensure that their counter staff is knowledgeable on all the products, what does what, and what product should not be used for an application. You want to have a satisfied customer who comes back for repeat purchases, not just a one-time hit. Look at margins, determine what products offer the best profit opportunity, and bring this to the attention of counterpeople. The jobber may even want to spiff them on their own or in conjunction with the manufacturer.
With respect to merchandising products, the use of “danglers,” counter displays, literature, posters and store positioning is necessary. Work with the manufacturer and obtain all they have to offer. If there is a special on a product for a week or month, have an end aisle display or counter display. Let your walk-in trade know that you have the item, and that it is highlighted for this period. If the pricing is really hot, then put up a sign that spells it out. This can result in impulse purchases or create interest and questions directed to the counter staff.
When merchandising, make sure that the product is timely and relevant. This is particularly important when promoting seasonal items. As well, look for complementary items. When a consumer sees a special on windshield washer fluid, why not make sure that wiper blades are right next to the display? Or put together a complete seasonal chemical package that could include anti-freeze, washer fluid, gas line anti-freeze, injector cleaner, etc. Make it a big, eye-catching display with lots of inventory.
For a regular shelf display, keep it clean and well stocked at all times, and keep common chemicals together (engine additives with engine additives and gas additives with gas additives). If the products are grouped by brand, you may lose out on some sales if one brand is stronger than another in a particular application.
The responsibility must be given to someone to keep the shelves stocked properly. Part of their job may be to walk the aisles to see what is missing and needs to be restocked. This person should also bring any depleted inventories to the attention of the manager to ensure that new product is on order. This will reduce the possibility of lost sales due to inventory problems.
With the flexibility of computer systems today, the jobber can run a query on any products on special during the week or month. Look at how they performed this period compared with the prior period or prior year. If sales are up, use this format in the future for other items. If it didn’t work, are there reasons why? Windshield washer may not have moved because the weather was wrong.
Category management can boost sales
The most common mistake jobbers make is in merchandising by manufacturer rather than by category. Also, high-velocity categories should be at the most visible level on the shelving. If you have the fastest moving categories in the most visible locations, then not only is it visible to the customer when it is full, it is visible to the staff when it is not. Do not clutter valuable space with no-name or unproven brands with the hope that the low price will attract the customer. Low price is not always obvious, but low quality is.
Impulse purchases are driven by visibility and perceived value. Clearly then, off-shelf visibility with end-of-aisle displays, product displays in visible locations and freestanding floor displays are proven winners. Also, signage, including regular and special pricing, improves visibility.
Tracking impulse over normal purchase patterns is more difficult for most jobbers, beyond the obvious sales velocity increase compared to normal volumes. Some computer systems are able to track sales by department, a convenient method of recording showroom sales. Untidy and dusty shelves, along with unclear pricing for merchandise, reduces the opportunity for rapid customer decisions.
There are a number of key factors in merchandising success: have an effective planogram, with high velocity items most visible; be “in-stock and on-shelf,” and buy recognizable name brands. Capitalize on off-shelf opportunities within the showroom (bulk displays, for example) and have clear signage announcing your product specials.
Use manufacturers’ merchandising aids to build profits
Getting customers to choose the highest profit products is often very difficult because commodity items such as brake fluid and power steering fluid are usually the fastest moving. The goal of every manufacturer is to have high grossing items with high volume levels. If you are fortunate enough to achieve this mix, it won’t be long before others realize the opportunity and enter that segment.
Keeping shelves fully stocked requires hard work and attention. The best retailers pay special attention to their display areas and make sure they are stocked and clean. Manufacturers with a sales staff can also lend a hand in layout, promotion and maintenance of retail areas.
The use of counter POP material, prime shelf locations and in-store promotions can help to maximize impulse purchases. Most jobbers’ computer systems can assist in the effective tracking and analysis of impulse sales.
Manufacturers spend a great deal of money on selling aids and displays. They should be utilized to advantage.
Match customer needs to product solutions
To help encourage jobbers’ customers to choose the higher profit products, use programs that educate the jobber staff on the benefits of synthetic oils and additives, so that they can best match customers’ needs to product solutions. An informed jobber understands oils and engine needs and can explain their value to customers.
To maximize impulse purchases, jobbers should use POS material and allowances. Maximize the tools provided by display allowances. These programs work – be sure to make use of them.
There are a number of ways to increase merchandising success. Keep displays clean. Renew stocks. If single bottles sell slowly versus by the case, keep the singles clean. Oil and additives are something customers frequently need – keep them in view.
High quality products result in high profit returns
Don’t forget that selling the highest quality product with the most sophisticated formula will produce the highest returns. High quality products cannot easily be duplicated. One of the most effective ways to sell the particular products you want to is display at eye level at the most high traffic, visible location on the shelf or in the store.
To effectively keep shelves stocked involves getting a system and making sure everybody follows that system. It helps if you can give a reward to best location, and best person.
To track purchases, you can use the cash register’s abilities. Even on a small non-computerized unit, you can set it up so that the item has its own PLU (price-look-up) where it is pre-priced and will track activity.
A key merchandising approach is to determine where the prime showroom positions are and to reserve these positions for the products you want to promote.
Product location is important in showroom merchandising
Displays such as counter and shelf units which contain a number of products as well as floor displays allow you to feature a product in a variety of spots in the showroom such as at the front of the store, which has high visibility and is good for displaying products for impulse purchases.
It’s like a grocery store, where they will have an end-cap display for impulse p urchases of products they want to promote. You would have chemicals, for example, in their usual location, but you would also feature them in another location as impulse items.
Signage, which helps build sales, should also be fresh looking. Get new ones if necessary. Don’t be afraid to ask sales representatives for assistance in this area. Most will respond very quickly if someone says they want new promotional material for their showroom. They know a clean-looking display will always sell more products than a dirty one.
Using these basic merchandising approaches, and keeping merchandising as a part of your regular routine, has been shown to be a successful approach in selling chemicals and additives. A logical, organized approach builds sales through both maximizing promotion and minimizing lost opportunities. It’s not time-consuming, or technically difficult, but it is effective.
Special thanks to the following for their contributions to this article: Ross Ayrhart, Wynn’s Canada; Brian Fox, merchandising manager, Hastings Inc.; Paul Morgan, vice-president, marketing, Recochem; Michael Birch, consumer development manager, Castrol Canada Inc.; Richard Navin, sales manager, Radiator Specialty of Canada Ltd.; and Chris Osborne, marketing manager, kleen-flo tumbler industries ltd.
HOW NOT TO MERCHANDISE CHEMICALS AND ADDITIVES:
A Seven-Step Recipe for Failure
1. Let dust and grime build up on all shelf stock.
2. Better yet, keep most products in the back storeroom where customers can’t see them.
3. Keep the showroom dimly lit so it’s hard to see the merchandise and difficult to read information on the package.
4. Ignore any advice from manufacturer and WD representatives. What do they know after visiting all the successful operations in your area?
5. Do not use any promotional or advertising allowances or signage entitlements.
6. Ignore seasonal opportunities and keep displayed stock at the same level all year.
7. Do not, under any circumstances, train any of your people in retail sales techniques.
Common Merchandising Mistakes
“A common merchandising mistake is in mixing categories and taking up valuable and limited high-visibility shelf space with unknown and unaccepted brands. The sad reality of the no-name is that it will occupy shelf space for a much longer period of time — this means reduced turns, and more important, potential lost sales if the desired brand is not clearly visible.” – Richard Navin, Radiator Specialty
“Some of the key merchandising mistakes include empty shelves, unorganized displays, and incorrect product mix. Jobbers often have a hundred different tasks to take care of and because of this their retail offering sometimes takes a back seat.” – Chris Osborne, kleen-flo
“Not anticipating seasonal needs. Don’t wait for the snow to come before ordering snowmobile oil. Don’t wait for the snow to melt before you order two-stroke oil for outboards etc.” – Michael Birch, Castrol Canada
“Thinking that store or shelf position doesn’t make that much difference. Tell that to Pepsi and Coke, who are continually fighting for shelf and store position.” – Paul Morgan, Recochem
“One of the big mistakes is allowing your stock to look dirty or dusty. This makes the product look old, grubby, and unappealing. Keep everything clean and tidy. Nobody should ever be standing behind a counter with nothing to do. Take a cloth and dust the stock if it needs it. It’s important to keep products fresh looking.”