Retail Category Management Expertise
“The absolute defining success factor of an individual retailer is: what it sells! In other words, its range of products and services. Everything else is support or window dressing.” Paul Foley, 2009
Modern Category Management (CM) is the best practice method to determine strategically what the range should actually look like, at any moment in time. Its major goals are to increase revenue and -profit, to reduce stock investment and space required. In addition, it represents a system easily adaptable to changes in competitive environment, customers’ needs or any other external factors.
The introduction of Category Management to a retailer usually starts with “reminding” them about their basic concept: who is their customer, why do they choose this particular retailer, what are and will be their needs in the future? The implementation process of modern category management usually takes 6-9 months, in order not to overload the current commercial team.
Category management best practice is about deep, regular and thorough analysis tools, which examine the role every product plays as part of a retailers assortment.
Foley Retail Consulting has recently successfully executed the implementation of a modern category management in the Balkans with tremendous success. Here is an excerpt of the KPIs achieved within only 12 months: gross margin increase from 20 to 21.5%, SKUs count reduction from 19,800 to 16,500, cash flow increase by 48%, stock holding reduction from 38 to 31 days total stock.