A main selling proposition used by NARMS members to secure business has come to the forefront in a big way. Amid stiff competition, shrinking margins and shrinking labor budgets, store workers have less time to stock shelves. A vivid example of this was brought to light last week when it was revealed in Bloomberg Businessweek that Wal-Mart has brought in third-party at-retail agencies to help them with a growing out-of-stock problem.
According to the story, the retail giant has hired at-retail merchandising and marketing service firms to visit stores and track out-of-stocks. The main driver for the problem is an attempt to return thousands of items to store shelves that had been removed as a result of a failed sku rationalization attempt. The surge has resulted in crowded storage space and pressure on thin store staffs.
What was once a case study for merchandising and moving products has become a case study for the value of third-party, in-store labor. The now classic Merchandising Gap theory, which has been around over a decade, seems to resonate better now than ever. The theory explains that dwindling at-retail resources combined with increased use of sales building in-store initiatives creates a gap that retailers struggle to fill. In the case of Wal-Mart, the blitz of new products has widened the gap even further.
The good news is that Wal-Mart has realized that the members of NARMS are perfectly suited to fill the Merchandising Gap. These professionals in store-level execution provide trained and experienced retail merchandisers that can be deployed at retail locations across the country. Their services are designed to fit into the go-to-market plans, and budgets, of CPG manufacturers and retailers alike. Many programs result in sales lifts that more than pay for the service, so it is not just a cost of doing business.
Take a few minutes to read the story and then share it with your sales staffs, associates, customers and prospects. It provides a crystal clear example of who NARMS members are and what they do.
Supermarket News recently held their 2011 SN Analysts Roundtable and the takeaways were not encouraging for CPG companies, retailers or consumers. The roundtable is an annual event that has been staged by the trade publication for 16 straight years. The story, by Elliot Zwiebach, includes the full text of the discussions with each panelist. Inflation and a sluggish economy are seen as the culprits for the pessimism.
Some of the analysts believe that we will see food inflation of 5-8% at the end of 2011 leading into a very tough 2012. They believe that rationality has kept things in check so far this year, but may not be enough to sustain the recovery. High rates of unemployment are seen to be getting worse causing more trade down. Enhanced uncertainty could eventually wear down that rational behavior.
Passing along costs to the consumer may not work as a remedy for trading partners. So far, the recovery had seen the middle class purchasing less. That is a new dynamic for our economy and has damaged the retail industry. The use of private label as an incentive to keep prices down has worked to some degree, but some of the analysts see that pace slowing.
It is difficult to predict who might break the mold. The analysts disagree on who is in a better position to come out on top. Some believe that giants like Wal-Mart and Kroger are best suited to withstand industry pressure because they can invest selectively in price.
It is no fun to read bad news about the supermarket industry because that is where many members of NARMS, professional at-retail merchandising and marketing service companies, operate every day. What is encouraging is that manufacturers and retailers are looking for answers. In tough economic times, store staffs shrink even as in-store promotion grows. A third-party provider offers the best solution to execute shelf and aisle level activities that are proven to augment sales and support brand building initiatives. Take a few moments out of your busy day to read and digest what this expert roundtable is telling us about the supermarket industry. You can link to the story by clicking here.
A member of the ISI Sharegroup recently shared an article from the Spring 2011 issue of Speak Magazine. The topic of the column is unlocking staff potential and the main point is that retail store managers are spending too much time in the office and not enough on the sales floor. They are inundated with administrative tasks which may explain why retailers have trouble consistently executing their strategy at the store level. Speak is a Microsoft customer publication for the retail industry.
Here are a few key findings from the story, which reports on a recent survey of more than 100 store managers. Thirty-one percent of store managers said they spend 10-20 hours or more per week answering e-mail and voicemail. Twenty-six percent said they spend 10-20 hours or more per week reading content on the company intranet/Internet. Thirty percent said they spend five hours or more per week reading reports and analyzing data. Twenty-six percent disagree there is good communication flow between stores and corporate. It all adds up to the biggest statistic of all. Forty-nine percent of store managers said they spend nine hours or less per week helping customers.
The article also says that headquarters are asking store managers to do more with less. Sixty-seven percent said the amount of store workload has increased over the last year. Eighty percent said the number of markdowns and promotions has increased over the past 12 months. Forty-four percent said their labor budget has decreased.
The author, OP Choudhary, concentrates more on technological solutions for the identified problems, but the data shared in the story is very relevant to members of the at-retail merchandising and marketing service industry. Basically, the merchandising service gap still exists and may be widening. Sales building in-store initiatives are on the rise while budgets to accomplish them are falling. Add the fact that store managers do not seem to have the time to deal with the issue and you have a real problem.
Luckily, manufacturers and retailers have access to the members of NARMS. There are times when an outsourced third-party solution to in-store execution makes even more sense and it looks like we are in one of those times. The ability to mobilize trained and experienced merchandisers, event personnel and installers without acquiring fixed costs and overhead could be just the ticket to ease some of the time crunch.
By Scot Maurath, CPLP
“What is the value of training to my company?” While the economy is rebounding, investment resources are still not yet plentiful. And this somewhat innocuous question has become an increasingly common inquiry as companies look both to renew investments and also gain more value out of the investments they make. Whether discussing with internal stakeholders, with clients, or with third-party providers, more than ever companies need a succinct and quantifiable answer to this issue.
Investing in training can be an endeavor many do not want to tackle because of the common negative connotations it comes with: “Training is not priority 1, 2, or even 3 for me.” “I don’t have time to create a training manual.” “We just don’t have the time or the money to invest.” or “I don’t have the resources or tools to manage a training initiative.”
Contrary to these beliefs, not only do innovative business operators have an opportunity to endorse and support training, they have a greater opportunity to use training as a selling proposition to their existing and potential clients to build stronger credibility, differentiate from their competitors, and even tip the scales when it comes to winning business.
Last year NARMS launched NARMScertifyU – an online learning center for field representatives and companies alike to take full advantage of learning fundamentals of retail marketing service industry standards. The solution overcomes negative connotations and gives companies a better chance to improve their quality of productivity in the field.
NARMScertifyU lowers the training cost for small, mid, and large companies, providing rich learning content and interactions in the form of self-pace modules that minimize business disruptiveness, and provide an effortless method to track individual learning progress.
The online learning center provides value for multiple stakeholders within a given organization. Field representatives, recruiters, and business operators see immediate value when the courses are tapped into and/or usage ofother features on NARMScertifyU. The value for each stakeholder is different and by exploring what it means to train for each stakeholder - we discover there are common threads that lead to common ground and business goals for all involved.
Workforce: Field representatives for the most part are the front-line of companies. They deliver the first impressions and are evaluated by the quality of work they conduct, their level of professionalism, and knowledge and expertise of the job/task.
The cornerstone value for field representatives to complete NARMScertifyU courses is two-fold. One; they learn the up-to-date best practices and industry standards and two; they receive certificates of course completions…allowing them to pin certificates to their NARMS profile in order for recruiters to identify them over other candidates.
Field representatives and job seekers are in constant search for personal training and professional development to help them improve their chances of recognition and acknowledgement. NARMScertifyU helps them continue to be competitive in the workforce, sustains motivation, and builds their sense of pride.
Recruiters: Completion of NARMScertifyU courses by field representatives – combined with its close integration to the NARMS Recruiter – enables recruiters to search the NARMS database by specific certificate titles and identify qualified candidates quicker. Recruiters are thus more confident in their hiring decisions knowing they have hired the right candidates for the right job with the right certificates and experiencing a savings in time and cost.
Business Operators: Operators should be encouraging their field representatives and recruiters to utilize NARMScertifyU, in that they are building a stronger, more experienced workforce leading to better productivity and with reassurance that each job was conducted with must-have fundamentals and high quality.
At the end of the day; field representatives and business operators should agree that NARMScertifyU is an enabler to helping them find common ground with three tenants that are paramount to their mutual success:
- Knowledge is power
- Credibility is gold, and
- Differentiation is survival
And the key to success is NARMScertifyU.
For more information about NARMScertifyU, please visit www.NARMScertifyU.com.
NARMS members are constantly striving to show customers and prospective clients how using third-party professional at-retail merchandising and marketing service companies can deliver not only exceptional in-store execution, but also how that results in increased sales revenue. During the next NARMS Webinar, Bart Flaherty will present a new release of data from the ongoing RORI project that finds MSOs deliver a greater than a 2 to 1 return to their clients. The hour long session will take place on Tuesday, January 25 at 1:00 PM CST. The NARMS Webinar Series is sponsored by Natural Insight and powered through the technology of ReadyTalk.
Flaherty, CEO of GroupM Business Sciences, will co-present third party vendor research analysis on the effective marketing strategies of Return on Revenue Investment (RORI), a program that efficiently measures investment with versatility and simplicity creating a positive benefit for vendors. He will illustrate how this will generate prominent resources for potential new business as well as building a more promising relationship with current clientele.
A catalyst in changing the role of marketing science in consumer product companies, Flaherty has been recognized for his forward thinking on the function of marketing in the retail environment. Twice awarded the prestigious PepsiCo Chairman’s Award, Flaherty leads the strategic hubs of the GroupM family of companies, including Mindshare, MediaCom. Maxus, MEC (Mediaedge:cia) and includes Ohal, the oldest ROI consultancy in the world.
This NARMS Webinar is another in a series of valuable member educational offerings by NARMS – U. The session is complimentary to NARMS members as a membership service but is also made available to other interested persons at a non-member rate of $99.95. We encourage you to share this invitation with other co-workers and anyone else who might gain value from this information-sharing opportunity. You can get more information and register for the event by clicking here.