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Why Planogram Maintenance Matters

Darren Gilbert
by Darren Gilbert on Oct 26, 2018 4:03:05 PM

Planogram Maintenance

While planogram maintenance can play a crucial role in whether you find retail success or not, that doesn’t mean the exercise is straightforward. That’s certainly true if you approach such a task without care or consideration. Or, if you fail to acknowledge the many different factors that can influence your final planogram.

We'll touch on each of the elements that you need to consider later on in this piece. But that isn’t the main point. Instead, this is about how often you need to refresh your planograms. After all, it’s never a good idea to create a planogram and then leave it be.

A planogram that works for you, rather than against you, requires continuous upkeep.

What is Planogram Maintenance

What is planogram maintenance and why can’t you set and forget planograms?

As a concept, there is not much to planogram maintenance. That’s because any explanation is relatively straightforward. In this instance, planogram maintenance refers to the business of upkeeping those planograms or shelf plans that you’ve generated for the categories that you stock in your stores.

You’re also likely to hear it referred to as POG maintenance.

That said, as easy as it is to understand, it’s importance should never be understated or underestimated. After all, your planograms are arguably one of the most crucial category management tools available to you. And the last thing you should do is jeopardise its effectiveness.

There is also the fact that a planogram is a living, breathing document. It’s neither static nor set in stone. That’s why you can’t only set them up and then forget them. As stated in the very title of this piece, planogram maintenance matters.

          1. Your product ranges constantly change

The first reason why it matters is that your product ranges change all the time. At least they should if you want to remain relevant to your customers and offer them the products they want. That means adding and removing products from your planogram.

By the way, this isn't a ranging exercise, which is more extensive (but just as crucial to complete). It’s rather about those micro changes that are worth implementing to ensure your product range remains suitable to shoppers’ needs.

[Videos] Learn how to create assortment plans that will improving the profitability and efficiency of your categories

For example, if a product isn’t performing as expected, you should look to either remove it or reduce its facings and replace any gap with an item that will offer you better sales and profits. Or, you might see an opportunity to open up on specific sub-categories.

To fully capitalise on any of the above opportunities, you need to communicate these changes into your space plan, something you can only do if you don’t continuously refresh them.

          2. Your retail data doesn’t stay the same

The fact that you’re implementing planograms in your store means that you’re altering shopper behaviour.

As a result of this change, your sales data will change too. Shoppers will purchase more of one product and less of another. That could be because of the season, or it could be because a product has reached the end of its lifecycle and it’s no longer available.

For whatever reason though, as behaviour shifts, you need to adapt your planograms and their layouts accordingly. If you don’t, you could find your shelves stocked with products that don’t meet consumer demands. And the consequences can include everything from dead stock to dwindling sales.

Refreshing Planograms

How often should you refresh your planograms?

The fact that you must refresh your planograms should no longer be up for debate if it ever were in the first place. That said, it’s still worth having the conversation because it leads naturally to a question about frequency: how often should you update your planograms?

If the first question was easy to answer, the second is a little more complicated.

The general rule of thumb is to update your planograms either once every quarter or every six months. Any more than that and you could find yourself misusing your time. Here’s why:

Every time you refresh your planograms, you flush in new data to ensure that the products on your shelf plan are meant to be there, and they have the correct space allocation. If you update monthly, for example, you could end up with skewed data that doesn’t tell you the whole story.

Of course, other factors will influence how often you update your shelf plans.

          1. It depends on the category

The first factor that can have a say in how often you refresh your planograms is the actual category.

Let’s say, for example, that you stock Canned Vegetables. For this category, you would probably look to refresh your shelf plans twice a year because you know that your Canned Soup (which is part of the product grouping) will pick up during winter and drop off during summer.

That would be the same for many other food categories and food retailers. Refreshing your planograms twice a year is a best practice.

[Videos] Learn how to create assortment plans that will improving the profitability and efficiency of your categories

Of course, you do need to plan any refresh. Since there are always new lines available for you to range, a good idea would be to give new products three to six months to perform, after which you can re-evaluate their space on the shelf.

          2. It depends on the seasonality 

A second factor, intrinsically linked to the first, is seasonality. With a seasonal category, you would typically look to update them during the season.

For example, you wouldn’t update your Sunscreen planogram during the middle of winter because that wouldn’t make sense. Instead, you’d do it when customers are purchasing products from within this category.

If we were to focus specifically on seasonal periods such as Christmas, Easter or a similar event, you’d do the same, updating them while they’re available. Once the period is over, you’d remove those SKUs and give the space to other products that will offer you a better return on your investment.

Updating Planograms

What can prevent you from maintaining planograms effectively?

As much as you might want to begin and complete a planogram maintenance exercise, there are instances where you are unable to do so effectively. This could be because of a number of different factors.

One such factor is the actual on-the-ground implementation. You need be aware of the best practices around refreshing planograms for your categories.

For example, as noted above, you can’t have your stores implementing planograms every week or month. Besides it not being advisable, there isn’t enough time for your data to show any significant changes.

There is also the time required for your staff to complete the work of processing your planograms. Let’s say you have 3000 planograms. If you were to refresh them four times a year, that would be 12 000 planograms each year.

Of course, if you have a large team, it’s easy to refresh them. However, if you have a very lean team, it’s impractical.

Besides the above two factors, skewed data, due to promotions, can play a significant role in preventing you and your staff from maintaining your planograms effectively. To prevent that, it’s advisable to work alongside your buyers to ensure that you apportion your shelf space appropriately. Doing so also allows you to take any promotion sales into account so that you don’t overface any items.

A further factor that can hamper your effectiveness is when your suppliers are not ready for the refresh period. They need to have their new listings in order by the time you want to refresh your planograms. Your discontinued lines also play a role.

Any discontinued SKUs must also be removed irrespective of the refresh period as they will influence how much space you have available on your shelf.

Conclusion

With DotActiv Lite, Pro and Enterprise, you can present your shoppers with logical and shopper friendly product layouts while improving your shelf space efficiency. For more information, visit our online store here or click below for a free demo.

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