Palmer Retail Solutions Blog

What is a Planogram?

Posted by Kathy Heil on Feb 2, 2016 3:19:22 PM

 AdobeStock_64542047.jpegIf you’re new to the retail world – or new to the management side of the business – you may not be familiar with planograms. What is a planogram? It’s simply a clever name for a diagram that shows in detail how you want each merchandise display to look. Once you’ve decided on a layout for your store and designated where all your fixtures will go, creating planograms is the next step in retail planning.

This may seem tedious, but it’s time well spent. In any retail setting, you have only a few seconds to capture a shopper’s attention. Planograms help you do that most effectively.

What is a planogram? A place for everything, and everything in its place.

Product placement directly influences sales. A planogram is a useful management tool that enables you to take advantage of the psychology of visual merchandising. You can:

  • Make the most of every square inch of sales space by defining in advance where each SKU will go within the store, right down to the precise shelf, hanger, or rack position.
  • Maximize visual appeal of displays.
  • Increase cross-sales by placing related items near one another.
  • Restock more efficiently and avoid out-of-stocks, because it’s easy to see gaps.
  • Achieve consistent presentation. With a detailed plan in hand, any employee can restock or recreate from scratch any display in your store, with exactly the same result. Saving your seasonal planograms makes it a breeze to remember next year that fabulously-productive display you designed this year. (You can also photograph your displays and use the photos as planograms.)

What is a planogram? Different styles for different stores.

Apparel and other specialty retailers create planograms using horizontal, vertical or block placement concepts. They focus on telling a product story with their visual merchandising.

Grocery stores and other small item/high volume retailers use the same visual concepts but their merchandising goals are more practical. Many use simple planograms with boxes and text. They plan in terms of:

  • Facings – rows of product that face the consumer (top sellers usually get multiple facings).
  • Shelf heights – the most popular and most profitable items are positioned at eye level and within easiest reach, although larger or heavier items may need to be lower.

A planogram can be as simple as a hand-drawn sketch or as detailed as a full-color, 3D representation. The point isn’t the art, it’s the thought process you use to choose product placements. This example shows both an initial planogram sketch and the final display. Planograms can also be used directly on the sales floor, with numbered peg-holes, printed tags, or outlines that identify which items go where.

Ready to plan? We’re here to help. Grab your sketchpad and a pencil, or check out the many online tools available to help you create planograms. SmartDraw is just one free example. In our next article, we’ll look at how you can create the perfect planogram for your store.

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