Category management ppt

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CATEGORY MANAGEMENT For WOMEN’S WEAR (NIFT,PATNA) SUDIPTA DIVYA ARPITA NEHA BANDANA KUMARI SWATI

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Transcript of Category management ppt

Page 1: Category management ppt

CATEGORY MANAGEMENTFor

WOMEN’S WEAR(NIFT,PATNA)

SUDIPTADIVYA ARPITANEHABANDANAKUMARI SWATI

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Category Management

CATEGORY

A distinct, manageable group of products/services that consumers perceive to be

interrelated and/or substitutable in meeting a consumer’s needs.

The distributor/supplier process of managing categories as strategic business units, producing enhanced business results by focusing on delivering consumer value.

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Category management represents a significant and proven opportunity to achieve substantial business improvements across the entire value chain - for consumers, distributors and suppliers.

2

The Category Management business process is a structured, measured set of activities designed to develop and implement a written category business plan.

Category management is a retailing concept.

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RETAILERMANUFACTURER

PRODUCT MANAGEMENT

CATEGORY MANAGEMENT

CUSTOMER MANAGEMENT

CONSUMER

PRODUCT MANAGEMENT

CUSTOMER MANAGEMENT

CUSTOMER RELATIONSHIP MARKETING

PRODUCT/CUSTOMER MANAGEMENT:A CONCEPTUAL MODEL

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Each category is run as a "mini business" (business unit) in its own right, with its own set of turnover and/or profitability targets

and strategies.

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“CONSUMER BEHAVIOR CHANGES THE CATEGORIES.”

The consumer drives what happens in the category.

The biggest change in category management over the years has been more of a focus on the consumer.

The process is now less “PRODUCT-CENTRIC and more “CONSUMER-CENTRIC”

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THEREFORE THE NEW MINDSET OF THE RETAILERS IS:

IF WE ARE NOT GETTING A FAIR SHARE OF THE CATEGORY, CHANCES ARE WE’RE NOT DOING A GOOD JOB OF UNDERSSTANDING CONSUMERS

AND SATISFYING THEIR NEEDS

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The industry standard model for category management is the 8-step process, or 8-step cycle

•Define the category (i.e. what products are included/excluded).•Define the role of the category within the retailer.•Assess the current performance.•Set objectives and targets for the category.•Devise an overall Strategy.•Devise specific tactics.•Implementation.•The eighth step is one of review which takes us back to step 1.

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Decision treeDemand cluster

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WOMENS WEAR

WESTERN

FORMAL WEAR

CASUAL WEAR

PARTY WEAR

CATEGORY DEFINITION

Product Groups/Categories is defined based on the consumer’s needs and purchasing habits.

B

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TROUSERSSKIRTSSHIRTSSCARVES

FORMAL WEAR

Full sleeves

Half sleeves

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JEANSSKIRTSSHORTSTOPST-SHIRTS

CASUAL WEAR

Pleated SkirtsMini SkirtsPencil SkirtsStraight SkirtsFlared Skirts

Flared jeansPencil cutbootcuthighwaistStraight fit3 quarter capri

Round NeckPolo T-shirtsCasual Shirts

Cap sleeveCorsetCowl neckCrew neckDouble-tee topHalter topOff shoulderTunic styleWrap top

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GOWNS DRESS

PARTY WEAR

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Monthly income (rs )

Casual wear Formal wear Party wear Scarves

Below 10,000 40 20 15 25

10,000-30,000 30 30 20 20

30,000-50,000 15 40 25 20

Above 50,000 15 10 40 35

Demand clustering

NOTE:On the basis of sales demand clustering has been done

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Life style Casual wear Formal wear Party wear Scarves

Tier 1 15 45 35 5

Tier 2 30 30 35 5

Tier 3 40 25 30 5

Lifestyle of women

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Occupation Casual wear Formal wear Party wear Scarves

student 55 25 15 5

Working 20 45 30 5

House wife 50 15 30 5

Occupation of woman

b

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Destination categoryThis is the main selling category of the store .Such categories have high purchase frequencyand high activity.And our destination category is CASUAL WEAR

CATEGORY ROLE

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Preferred Categories

With the help of these types of categories , the owner/brand builds a distinct image of itself in the minds of the customers.

Our preferred categories is Formal wear

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Convenience Categories

This category only adds to the bill value of the customer as customer pick up this category unplanned

Low purchase frequency and low penetration.

And our convenience categories is scarves

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Occasional/ Seasonal Categories

Meets the seasonal/ occasional needs of the customers.

And our seasonal category is partywear

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Destination category- Casual wear

Occasional category-Party wear

Convenience category-Accessories

Preferred category-formal wear

CATEGORY

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CATEGORY ASSESSMENT

• Profitability (Net Profit Margin , or net profit in %, ROI)

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Assessment Particulars casual Formal Party Scarves

Gross sale 30,00,000 25,00,000 20,00,000 3,00,000

Returns 12,000 20,000 10,000 1,000

Discounts 10,000 40,000 50,000 …………

Net sales 29,78,000 24,40,000 19,40,000 2,99,000

Cost of goods sold

10,00,000 12,00,000 10,00,000 50,000

Gross margin 19,78,000 12,40,000 9,40,000 2,49,000

Expenses 50,000 40,000 35,000 10,000

Net profit 19,28,000 12,00,000 9,05,000 2,39,000

Net profit in % 64.74 49.18 46.64 79.93

ASSET 15,00,000 15,00,000 15,00,000 1,00,000

ROA 1.285 0.8 0.60 2.39

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particulars Casual wear Formal wear Party wear Scarves

Gross margin 19,78,000 12,40,000 9,40,000 2,49,000

Space (sqft) 2,000 1,500 1,000 500

GMROS 989 836.66 940 498

B

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Score card

• Sell through analysis• Stock turnover ratio

B

category wt Formal wear

Casual wear

PARTY WEAR

SCARVES

PROFIT 3 3 4 2 3

ROA 5 4 4 3 1

GROSS MARGIN

2 3 2 2 3

WA 11.6 12 8.3 6.6

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Strategies Red cluster (A) Green cluster (B) Yellow cluster(C)

Casual wear: the maximum revenue is from non earning group, and in tier 3 cities, the assortment will be trendy , with wide variety and the price range will be kept low.

Formal wear: incomeGroup of 30,000- 50,000 mainly in tier 3 cities and the working group, the assortment will be staple , and classy

Party wear: mainly for working class with income above 50,000. high range products in assortment.

Casual wear: from income group of 10, 000- 30,000 and in tier 2 cities. mainly jeans , mid length skirts, half and full sleeves tops will be kept in assortment.

Formal wear: for people in income group of 10,000 – 30,000 in tier two cities .Slight variations in assortment

Party wear: assortment according to income group above 30,000 for people in tier 2 and 3 cities both for working and non working therefore assortment will be wide and high range products

We will try to find out the gap as the sale is less in this cluster. Assortment with wide variations in variety , price and quality will be provided. Customer demand surveys is to be done.

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Casual wearwide varietyCompetitive in market

Party wear

Wide breadth but narrow depth of the category

Category Assortment

Fixed price range starting from 199 to 2999 INR

main store location,Higher shelf space

Competitive

In the store isles and the center display unit of the store

PricingShelf

placement

Advertising , In store promos,Hoarding,TV ads

Catchy window display

Promotion

CATEGORY TACTICS(Tactogram)

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Formal wearWide variety with depth and breadth

ScarvesLimited breadth and depth

Category Assortment

Same price almost everytime other than end of season sale

At the back end of the store

Competitive

Near billing counter

PricingShelf

placement

window display.

No

Promotion

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IMPLEMENTATION

We will implement in out strategy in category choosing

Planogram will be developed on the basis of the cluster we have identified

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Promotional Strategies

SCHEMES:• If purchase amount is unto Rs 30,00 then we

offer special gift vouchers• If Purchase amount is more than Rs 5,000, we

are offering special gift such as fashion jewellery.

• For purchasing of Rs10,000 we offer 10%off on next purchase.