From a manufacturer’s
perspective, category management stimulates the growth of their categories and
their brands. The process allows them to collaborate with retailers to strongly
influence consumers at the store. Moreover, as category captain or category
advisors, participating manufacturers benefit from value added relationship
with retailers.
Customers benefit from the improved shopping
experience. They find the right mix of products, merchandised in a logical and
attractive manner.
Category management helps retailers cope with the
complexity of their operations and maximise their return on inventory
investment. Improvements in product range and merchandising enhance shopper
satisfaction and store loyalty and reduce stockouts. These factors help to
lift sales.
In addition, retailers benefit from cost
saving ensuing from the culling of poor performing items, optimization of
inventory, and reduction of costs associated with inventory holding and working
capital. These reductions in costs and the improvements in sales, combine to
substantially improve profits for retailers.
