Convergence – Assortment Optimization = Winning at Shelf

Category Initiatives helps AWG Members win at shelf and realize long-term cost of goods improvement with the development of optimal assortment recommendations, focus on improved trade funds, inclusion of new items and focus on AWG Brands to increase top line sales and bottom line profit. Category initiatives help retailers win at the shelf by offering the most productive skus, engage consumers with new items earlier in the product life cycle, maintain profitable planograms, and drive value perception with AWG Brands.

All the original reasons still apply:

• It makes us stronger, acting like a chain
• It allows us to strengthen cost of goods collectively with CPG companies as opposed to fractured from each retailer.
• It strengthens our private label bargaining power
• It creates smarter product sets with efficient assortment to ensure we have maximum effort to leverage the best cost of goods

So, the million-dollar question: Is it working? The simple answer is yes.”

Measuring Impact

Optimized assortments deliver incremental value at retail but the only way to know that is to measure it. That’s why the AWG merchandising team continues to build out analytical capability that delivers clear metrics related to the impact of Category Initiatives. As the number of retailers participating grows and time passes since resets were executed, baseline calculations can be taken to benchmark results, reset data anomalies, determine the impact of SNAP, and account for promotional variances. These measurement model modifications will continue to be refined and additional data, like retailer point of sale data, will only improve the analysis.

Getting Sustainable Product to Shelf

Across products and categories, brands are addressing consumer concerns about how products support a greener environment. Plant-based offerings in cheeses, ice creams, pasta sauces, and assortments down the frozen aisle give lifestyle consumers better options for replacing animal protein. Packaging options continue to evolve as well, whether that means concentrated laundry detergents in smaller jugs or packaging that’s more sustainable to produce and easier to recycle. Sustainability is on consumers’ minds and brands are responding. All of these changes are showing up in the product assortment reflected in planograms developed during Category Initiatives as they evolve to appeal to these earth-conscious consumers.

One Source Solution

The AWG One Source program is a great opportunity for member retailers to benefit from in-store merchandising support. The primary goals of the One Source merchandising program include:

• helping member retailers execute the Convergence strategy via Assortment Optimization
• increasing speed to shelf for new items
• addressing conversions and distribution voids

This program will help member retailers ultimately update the majority of the store over a 3-year period. The One Source program also provides cost-saving opportunities for member retailers versus hiring labor on their own. Member retailers must meet volume and distance requirements to participate in the AWG One Source program. For more information on One Source or to inquire about signing up, please contact your district manager.