By using planogram software, significant cost reductions can be realised related to stock, efficiency and eliminating mock-up costs. The reduction of the costs will increase the companies’ revenue and will lead to additional efficiencies in store. There are several ways in which planogram software contributes a reduction in costs:
1. Reduce Stock Related Costs
Stock is an important source of expenses for retailers. The most expensive stock is stock that is not turning. These products will accumulate costs and capital interest without generating any profits through sales. Poorly designed planograms and category management that does not is not data driven will increase excessive stock.
By using an intelligent planogram tool, the stock costs can immediately be reduced. As mentioned before, days of supply analysis can give insights into the stock that is needed for each individual product. Another approach to decrease the stock costs is by investigating the credible range of a store or planogram. The Pareto curve can help with this. The Pareto curve shows the 20% of products that account for 80% of the profit. This way, the number of products on the shelves, can be reduced without a reduction in profit. This smaller product assortment will decrease the stock costs.
Reduce wastage costs
Categories that can reduce their inventory costs the most is fresh food categories. Optimising the shelf space with products that have proven to sell quickly will result in reductions in the wastage costs. Location specific, data driven planograms are essential as well to lower the costs of spoilage. This can be achieved by using cross planogram analysis, hotspot analysis and days of supply analysis in planogram software.
2. Eliminate Mock Up Costs
The costs for the use of mock up centres or mock up software are high for retailers whilst the outputs and process is generally inefficient and slow. Planogram software eliminates the need for mock up centres and software whilst also providing a large array of other features and functionalities.
All fixture types available
By using planogram software, fixture types can be easily created and copied, creating realistic fixtures and planograms. This means mocking up fixtures is not needed anymore and the costs on the mock ups can be saved.
No costs for changes
When retailers use mock up shops or mock up consultancy services it costs money every time the fixture, store plan or planogram needs to be changes or tweaked. Besides these costs associated, it also comes with inefficient discussions with third party companies. To save time and costs, in-house planogram and fixture creation with Scorpion is a great solution.