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Part 1: Definition, Standards, and Significance of Merchandising

1. What is merchandising? It means presenting products more vividly in front of consumers, making them easy to identify, attracting their attention, and thereby increasing the chances of purchase.

2. Why do companies establish merchandising standards? What is their significance? As market competition intensifies, establishing merchandising standards not only enhances the company's brand image but also allows consumers to see a clean, orderly display style among many competing products, creating a strong visual impact that is easier to remember and triggers impulse purchases.

Research has found that consumers (especially women, who are the main buyers of snack foods) often make unplanned purchases—deciding on the spot after seeing product displays. Merchandising can improve product presentation and stimulate purchase intent. It can also be said that the quality of product display is the last chance to drive sales; only products that attract customer attention will sell! Most consumers shop randomly in supermarkets, spending an average of 15 minutes per visit (excluding hypermarkets), pausing 15 seconds in front of a product category, and 75% make decisions within 5 seconds. If they can't see the product they want, 40% will buy another brand. Lost sales opportunities never return; once a consumer's purchase is missed, that sale is lost forever. The consumer won't buy double next time to make up for it (especially for snack foods).

Part 2: Product Display

Product display is divided into shelf display and off-shelf display.

1. Shelf Display

Principles of shelf display:

  • Quantity: Increasing the number of display facings strengthens visual impact, creates a sense of abundance, and boosts sales.
  • Concentration: All products in the company's series should be displayed together to create associative, holistic brand impressions and influence.
  • Color: Eye-catching colors and appropriate color combinations leave consumers with an impression of product variety, strong selection, and corporate strength, enhancing the display effect.
  • Lighting: Proper lighting can enhance product color, deepen the impression of refinement and elegance, and create desired display effects and shopping atmospheres such as romance, enthusiasm, or freshness. It also attracts buyers' attention and fosters affinity with the product.
  • Leading products: The best-selling leading products should occupy the largest display space.
  • Prominent position: Key brand products should be placed in the first best position—at eye level.

1.1 Choosing the shelf display position The same product in the same store can see huge sales variations depending on its shelf position.

  • Golden shelf area: 60-160 cm, visible at eye level, easy to reach, accounts for 50% of sales.
  • Secondary position: 160-180 cm and 30-60 cm, accounts for 30% of sales.
  • Top and bottom: Above 180 cm and below 30 cm, accounts for 15% of sales. Always maintain a fixed display position for products to prevent competitors from encroaching. Additionally, most consumers walk in one direction in a store; few walk back and forth in the same aisle. Easterners generally have a right-side orientation and pay more attention to products on their right. Therefore, in the same aisle, the right-side shelf often performs better than the left.

1.2 Impact of different shelf heights on sales Shelves typically have several heights: eye level, direct view, arm's reach, and knee height. The impact of different heights on sales is: (1) Moving from arm's reach to knee height decreases sales by 15%. (2) Moving from knee height to arm's reach increases sales by 20%. (3) Moving from arm's reach to direct view increases sales by 30%-50%. (4) Moving from direct view to knee height decreases sales by 30%-60%. (5) Moving from direct view to arm's reach decreases sales by 15%.

1.3 Company requirements for shelf display (1) Company products should be displayed vertically, with the same specification and packaging on the same shelf level horizontally. Each specification should have at least three facings, and the larger the facing, the better—sales are almost proportional to facing size. (2) Best-selling specifications, or those the company is promoting, or those with higher profit margins, should be placed on the best shelves in the middle, or rotated periodically to the best positions. (3) When conditions allow, fully utilize merchandising aids such as price cards, insert cards, wobblers, hanging flags, and balloons. The front of products on the same shelf should face customers uniformly. Remove a few bags from neatly arranged products to indicate good sales. (4) Products must have clear price tags; be careful not to misplace them. (5) Place products with earlier production dates in front for quick sale to avoid overstocking and expiration. (6) All Chinese labels should face outward. (7) Place heavy, large items on lower shelves and small, light items on upper shelves for customer convenience and aesthetic preference. (8) During new product launches, ensure new products occupy at least one-third of the display space. (9) Place products next to the best-selling products in the same category to "borrow their spotlight."

How to use best-selling products to enhance display? If a company's product is new to a store, it may not sell well immediately. How should you choose a display position? In addition to the above requirements, the most important is to choose a position next to best-selling products, which is also the best promotional spot for new products.

We know that consumers passing through a store can see 100-200 products per minute, and products that catch their attention get about 5 seconds of their time—the so-called "5-second advertisement in the store." All merchants' "hand-to-hand combat" in the store is essentially about winning these 5 seconds of attention. But consumers pass a product on average every 0.5 seconds. How can you make your product stand out among 100-200 products and gain attention?

Best-selling products are usually located in high-traffic areas, where consumers linger longer, increasing the chance of attention and purchase. Data shows that products displayed adjacent to best-sellers receive far more consumer attention than others.

When using best-sellers to enhance your display, note two issues:

  1. If your product is clearly inferior in quality, packaging, price, etc., stay away from best-sellers; otherwise, you'll become a foil and expose your weaknesses.
  2. Be sure to highlight your product's unique characteristics compared to the best-seller, so your product can compete at the same level. Merchandising is the best way to express individuality.

2. Off-Shelf Display

2.1 End-cap display (1) Display promotional product specifications with clear promotional signs like "Special Price" or "Prize." (2) Keep end-caps fully stocked; display at most two SKUs per end-cap, preferably one. (3) Products on end-caps must be large packages. (4) When conditions allow, fully utilize company merchandising aids.

2.2 Floor stack display (1) Choose locations on the most frequented customer routes. (2) Stacking method: Ensure the base is stable; use cross-stacking. POP and product packaging fronts should face consumers, at a suitable height for easy access. Cut-case display: When no fixed or special display stands are available, cut the cartons according to box structure and label printing, typically cutting the front in a trapezoid down to the lower waist, allowing full product visibility and simple display. (3) Types of floor stacks:

  • Island floor display: Located in the center of the main traffic aisle, accessible from four directions; all layers except the bottom should be cut to show labels.
  • Trapezoid floor display: Against a wall, accessible from three sides; all layers except the bottom are cut, with each layer receding.
  • Pyramid display: Square, wider at the bottom, tapering upward, displayed in multiple layers. (4) When restocking, follow the principle of back-to-front, top-to-bottom. (5) Display preferably one product specification, and it should be large packages. The height of the stack should be convenient for consumers to pick up. (6) Floor stacks must have clear promotional information or price tags. (7) Surround the floor stack with company banners or POP.

The above are the company's "supermarket display rules." In practice, salespeople face constraints such as store regulations, competitive and product sales bases, and customer relationships, so they cannot fully implement the textbook rules.

Part 3: How Should Supermarket Display Actually Be Done?

1. Correct Mindset: Understanding the Essence of Supermarket Display —"No move beats a move" (flexibility over rigidity)

To truly improve your supermarket display "martial arts," memorizing dozens of display rules is not enough. You must understand the deeper meaning and apply them flexibly.

  1. The essence of supermarket display is: adapt to situations, no fixed moves. The so-called display rules are just basic, principle-level knowledge or "internal skills." In practice, supermarket display is not painting on a blank canvas; you must consider the specific constraints of each store, use basic knowledge, and adapt to situations.

  2. The significance of display rules lies in a unified visual effect. Different companies have different display rules. The actual significance is not the rule itself (e.g., whether "brand vertical, packaging horizontal" is better than the reverse is debatable), but having a standard so consumers see a consistent display style across different outlets, making it easier to remember.

  3. The core of display rules is to occupy maximum space. If you find it hard to remember all the rules, just remember one sentence: "Display as many products as possible and occupy as much display space as possible." If you can push competitors off the shelf, you can push them out of the market!

  4. Supermarket display is not an isolated task. Effective display depends on store support, which is based on: (1) You invest more in display fees. (2) Good after-sales service, professional and attentive sales staff, and good customer relationships. (3) Your products sell well and generate high profits in the store. (4) Your promotions enhance the store's "low price" image. To improve display effectiveness, you need to work on product mix, pricing, promotions, display fees, after-sales service, and sales visits. Relying solely on sales visits to improve display (especially securing display positions) is like "water without a source" or "clapping with one hand."

  5. Display has no end; it relies on execution. Securing the best display position and space is only the first step. Maintaining the display requires daily, monthly, and yearly efforts from sales staff. The manufacturer that supplies more promptly, visits more frequently, and does more solid shelf work will maintain its display position and gradually take over competitors' positions. Supermarket display performance is, to some extent, a reflection of sales staff's dedication—a contest of execution and endurance.

  6. There is no best display, only better; learn to "give and take." Since supermarket display space is limited, adding a facing for one SKU reduces space for another. Therefore, there is never a perfect display; you can only strive for better. Based on promotional priorities at different times, you must sacrifice "secondary" SKUs to prioritize key items.

2. Practical Tips—Know Yourself and Your Enemy, Adapt to Situations Most difficulties in supermarket display come from store regulations. Therefore, being familiar with common store display rules and how to counter them allows you to turn passivity into initiative.

2.1 Comply with store display norms Background: Each supermarket has its own display style and regulations, which restrict how manufacturers can display products (e.g., grouping by flavor, packaging, or price prevents manufacturers from displaying together). In such cases, design a display plan tailored to that store. Actions: Common techniques include: (1) Design a display plan: When creating a display modification plan, first draw a diagram of the store's snack area, including shelf width, number of layers, competitor distribution, the space you've secured, and your planned display positions. (2) For stores that group by specification (all brands of the same specification placed vertically together), try to make your products "connect vertically" within the same specification zone, using adjacent positions to place your two specifications next to each other to create a concentrated display effect. (3) For stores that group by brand (each manufacturer gets a designated area), supermarket shelves typically have 4-6 layers, with the most effective being the middle layers (100-170 cm). If you use horizontal display (one item per layer), the top and bottom layers won't be in the effective zone. If you use vertical display (items arranged vertically), you need at least two facings per SKU, but limited space may prevent full assortment display. Counter-strategy: Use a cross-display method:

  1. Try to give every barcode at least one effective facing.
  2. Don't be limited by the actual number of shelf layers; redefine the layers from an effective display perspective. Example: If a shelf has 5 layers, you can redefine it as 3 effective layers: treat layers 1 and 2 as one, layer 3 as one, and layers 4 and 5 as one. When displaying multiple barcodes, this ensures each barcode occupies a facing in the effective display zone (layers 2-4). Similarly, for a 4-layer shelf, redefine it as two layers, etc.

2.2 Securing display positions when entering a store Background:

  1. When a new product enters a store, the supermarket buyer will specify the display position and facings via a "shelf allocation plan," which is hard to change once set.
  2. For new products, the order will include minimum order quantities and initial order quantities agreed with the supplier. Actions: (1) When entering a store, negotiate hard with the buyer to secure the most "favorable display conditions." Common negotiation angles:
  • Use promotions to enhance display.
  • Highlight unique selling points: If your product has unique features compared to existing products, it can attract new consumer groups and increase overall category sales (e.g., if existing products are mid-to-high priced, your low-price product has an advantage).
  • Offer exclusive benefits to the store (e.g., exclusive distribution of a barcode, lower prices, higher profits, better after-sales service).
  • Present a full-year plan.
  • Use competitive psychology.
  • Use weak competitors: Point out that a weak competitor occupies a certain number of facings; if you get the same, you can guarantee a certain sales volume and profit. (2) Ensure the first delivery is complete: Once the shelf allocation plan is set, the first delivery must be 100% complete for all items, and coordinate with the store manager to fully implement the plan. Otherwise, you may lose the hard-won display space or have to pay new product fees again. (3) Adjust minimum order quantities: Supermarket orders are often computer-generated, and the minimum order quantity set at entry will affect the store's order quantity and safety stock, impacting sales and display. Therefore, actively participate in setting minimum order quantities and propose adjustments.

2.3 Grabbing display space during routine visits (1) Visit timing: Learn competitors' sales reps' visit times and schedule yours right after to quickly undermine their display and grab facings. (2) Every promotion is an opportunity to expand facings. (3) Target weak brands: "Brand X's sales have been declining, yet they occupy a large shelf. Give me that space, and I can increase sales by X amount." (4) Wait for opportunities: Supermarket layouts usually don't change, but they do during renovations, anniversaries, season changes, holidays, new product launches, or product phase-outs. These are the best times to grab facings (especially when competitors are out of stock, out of assortment, or removed for violations; immediately fill the gap and negotiate with the store using strong promotions). (5) Sales rep alliances: Form alliances with reps from other brands: "When we go to the store to tidy up, we won't fight each other; we'll all target Brand X's facings." (6) Facing swaps: Even if there are "idle" facings far from your display area, grab them. You can trade these "spoils" with other manufacturers for useful facings or build goodwill (seeking cooperation with their reps). (7) Timely supply: Monitor each store's sales and help adjust safety stock levels to ensure timely delivery, preventing loss of facings due to stockouts. (8) Seek assistance: Build good relationships with store stock clerks so they look after your display when you're not there. Form alliances with non-competing manufacturers' stock clerks to help each other with displays. (9) Grab transit storage: Supermarkets often have small transit storage areas near shelves (top/bottom layers, stair sides, corners near entrances) for quick restocking. If your product is understocked in transit storage, competitors can easily take over your facings. (10) Develop secondary display spaces: If good end-cap positions in the leisure area are taken, try to get end-caps in adjacent areas (e.g., instant noodle section). The fee may be lower, and because your product is different in that section, it stands out and can be effective. (11) Develop dead corners: Aisles at the end of the store are often dead zones with low traffic. Try to buy the year-round end-cap in the dead corner near your shelf at a low price, then work with the store to set up large posters, cartoon POP, free tasting tables, mirrors, etc., to attract traffic and activate the corner.