What is a Planogram? Definitions and Examples
The organizational concept of retail store arrangements is hardly left up to chance. From big-box stores to small businesses, there is always someone behind the scenes arranging the assortment and placement of items for shoppers. Much of this organization is based on space planning.
How a business manages this ongoing process of displaying, stocking, and planning for store shelving can be tricky–many still draw the store shelves in software like AutoCAD or Adobe Illustrator and change the drawing daily. However, advancements in planogram software have made this process much more efficient.
Today, retailers can easily set up a store’s planogram to print or access on a device as a layout of the store’s merchandising arrangement. This makes getting products to the right shelves far easier for employees, and also improves product placement strategy and sales.
This article will describe what a planogram is, provide some concrete examples of how to use one, and explain how your retail space can benefit.
What is a Planogram?
So what is a planogram, and how is it used? A planogram is a diagram or model to indicate retail product placement on shelves to maximize sales.
Products make quite a journey around the world from the point of manufacturing to the shelf where their ultimate fate of selling awaits. Getting products on the shelf represents the “last 50 feet of the supply chain.” This part of the process can’t be easily automated, but instead relies heavily on teams for correct placement.
A planogram removes the guesswork so that store personnel know where products should be placed on each retail fixture or display, and in what fashion. Planogramming is one of the most essential functions of retail merchandising, but it differs for every store.
Does Every Retail Store Use a Planogram?
Yes, every retailer utilizes a planogram in some form. However, it might be called something different. Some stores might refer to it as a POG or a schematic.
Store associates can print out the schematic or access the planogram on the store’s mobile connected device. They now have a visual representation of the desired merchandise placement, creating standardization for accurate retail merchandising.
Do Retail Stores Need Planogramming Software?
When created in a visual merchandising tool or software, planograms can help brands better organize their products to improve sales and business relationships.
The best planogram software will easily integrate with other merchandising tools, including floor planning, retail analytics, compliance, omnichannel order management, and sales optimization solutions.
Elements of a Planogram
You might be wondering what a store planogram looks like. A planogram diagram is like an architectural or engineering drawing, except the schematics represent the blueprint of your retail shelf.
As part of a larger visual merchandising plan, the planogram will:
- Reflect the arrangement of shelving units
- Label the positioning and facings of each product by fixture
- Display potential product facings and other metadata elements
- Label priority placement between product types
- Describe featured or showcased brands
- Provide detailed descriptions of the fixture type (i.e., wire rack, bin, laydown)
These functions define product placement and displays affecting customer buying decisions. By using planograms, retailers no longer leave product sell-through success to chance.
In summary, the elements of the planogram include object dimensions, displays, products, product category, number of facings, aisle, packaging, “methodology” or organizational theory, and visual instructions for carrying these out.
How to Read a Planogram
As with any technology, the goal of a planogram is for it to get used. Reading a planogram is often quite simple as long as you understand the elements.
The planogram represents store displays and shelves visually. Shelf or display details and product placement are the primary data, including dimensions, shelf height, product positioning, number of products, product facings, and more, so that store personnel understand the product placement specifics.
Planogram details vary by store, but typically include display type and may include specific dimensions.
The most important information is the product assortment, or which products are being used, and their facings. This will include brand details, product sizes, packaging specifications, techniques for shelving, and facing.
A visual representation of a planogram illustrates its benefits. Here’s an example of a simplified grocery store planogram:
How to Make a Planogram
Now that you understand what a planogram is, the next step is making one.
As we mentioned previously, some retailers use Adobe Illustrator or other graphical products. Some retailers still make planograms using Excel and overlay visual representations manually with modifications for each store location.
Others use dedicated software, even if the software has limitations such as 2D representation or requires redundant manual inputs. Some of the oldest “automated” solutions are still costly and inflexible.
Most retailers don’t begin with a blank slate when creating a planogram. They typically borrow an existing planogram from a nearby store location to work from or modify. This is often referred to as using a planogram template.
Loading the planogram with your store assortment takes strategy and planning. Planogrammers can adjust the planogram based on the new store assortment daily, weekly, or monthly for product changes, like discontinued, new, and maintained products.
Check this blog again for our next entry on how this happens in practice!
Benefits of Planogramming With MerchLogix
Planograms optimize retail sales, space, and operations through intelligent design, digital inventory, and space planning. Merchlogix planogram software is trusted by some of the world’s biggest retail brands, yet remains flexible enough to adapt to your operating model and retail plans. Request a demo today to see how MerchLogix can improve your retail store operations and profitability.