Store Layout and Design Chapter 13 Store Layout and Design

Learning Objectives List the elements of a store’s environment and define its two primary objectives Discuss the steps involved in planning the store Describe how various types of fixtures, merchandise presentation methods and techniques, and the psychology of merchandise presentation are used to increase the productivity of the sales floor

Learning Objectives Describe why store design is so important to a store’s success Explain the role of visual communications in a retail store

Introduction to Store Layout Management Store setting and presentation are critical factors in serving the customer To encourage repeat visits and purchasing, online retailers should: Keep content current Make the site easy and enjoyable to work Structure an online community for consumers to interact LO 1

Supermarket Style Right Handed 90% turn right/Store brands Neatness counts? Dump displays/Hand Written End Caps Highest turnovers/25-25-50 Creatures of Habit A little bit greedy Limit 4

Exhibit 13.1 - Elements That Compose the Store Environment LO 1

Introduction to Store Layout Management Objectives of the store environment Creating desired store image- Important factors Merchandise carried Promotional activities Customer service Cleanliness Sales force LO 1

$300 per square foot Yields $1,500

Introduction to Store Layout Management Increasing space productivity The more merchandise customers are exposed to that is presented in an orderly manner: The more they tend to buy Fuel Up, Sit down, Retailtainment, Bathrooms Length in store Exposure to merchandize? (Robert Kahn) Incorporating new advances in technology can help stimulate sales Shrinkage: Merchandise that cannot be accounted for due to theft, loss, or damage LO 1

Store Planning Floor plan A schematic that shows: Where merchandise and customer service departments are located How customers circulate through the store, and how much space is dedicated to each department Is based around the predicted demands of the store’s targeted customer LO 1

Exhibit 13.2 - These Warning Signs may Indicate a Space Problem LO 2

Store Planning Microretailing: Occurs when a chain store retailer operating over a wide geographic area: Tailors its merchandise and services in each store to the needs of the immediate trading area Adjacencies: Merchandise being arranged alongside other merchandise (IKEA) Stack-outs: Pallets of merchandise set out on the floor in front of the main shelves (Winco) LO 2

Store Planning Allocating space Circulation Shrinkage prevention Types of space needed Back room Offices and other functional spaces Aisles, service areas, and other nonselling areas Floor merchandise space Wall merchandise space Space allocation planning Circulation Shrinkage prevention LO 2

Store Planning Space allocation planning Improving space productivity in existing stores Space productivity index Compares the percentage of the store’s total gross margin that a particular merchandise category generates to: Its percentage of total store selling space used Space allocations for a new store Robert Kahn’s theory - Retailers should concentrate on the time customers spend browsing and experiencing the store: Not on how much merchandise they are exposed to LO 2

Exhibit 13.4 - Impact of Customer Traffic and Length of Store Visit LO 2

Store Planning Planograms: Illustrate how and where a retailer’s merchandise should be displayed on the shelf Designed to allow the retailer to increase space productivity by taking into account Inventory Turnover Space and inventory investment requirement Gross margins of SKU’s LO 2

Store Planning Circulation Ensures efficient movement shoppers through the store, exposing them to more merchandise Determines the character of the store Types of layouts Free-flow layout Grid layout Loop layout Spine layout LO 2

Store Planning Free-flow layout Fixtures and merchandise are grouped into free-flowing patterns on the sales floor. Grid layout The counters and fixtures are placed in long rows or ‘‘runs,’’ usually at right angles, throughout the store. Loop layout A major customer aisle begins at the entrance, loops through the store—usually in the shape of a circle, square, or rectangle—and then returns the customer to the front of the store. Spine layout A single main aisle runs from the front to the back of the store, transporting customers in both directions, and where on either side of this spine, merchandise departments using either a free-flow or grid pattern branch off toward the back side walls. LO 2

Exhibit 13.5 - Free-Flow Layout

Exhibit 13.6 - Grid Layout LO 2

Exhibit 13.7 - Loop Layout LO 2

Exhibit 13.7 - Spine Layout LO 2

Planning Fixtures and Merchandise Presentation On-shelf merchandising Display of merchandise on counters, racks, shelves, and fixtures throughout the store. Must be attractive, easy to understand and accessible Must be reasonably easy to maintain LO 3

Planning Fixtures and Merchandise Presentation Fixture types Merchandise-presentation planning Selecting fixtures and merchandise-presentation methods Visual merchandising LO 3

Fixture Types Hardlines fixtures Softlines fixtures Wall fixtures Bulk or capacity fixture: Display fixture that is intended to: Hold the bulk of merchandise without looking as heavy as a long, straight rack of merchandise. Feature fixture: Display that draws special attention to selected features of merchandise Wall fixtures LO 3

Exhibit 13.9 - Four-Way Feature Rack and Round Rack LO 3

Merchandise Presentation Planning Shelving- Merchandise is placed on shelves that are inserted into gondolas or wall systems Hanging- Hangers hung from softlines fixtures Pegging Merchandise can be hung from peg hooks Suitable for small merchandise LO 3

Merchandise Presentation Planning Folding large, unwieldy softlines merchandise folded and then stacked onto shelves Stacking- Large hardlines merchandise stacked on: Shelves, base decks of gondolas, or flats Dumping- Merchandise dumped in bins or baskets inserted into gondolas or wall systems Effective promotional method L O 3

Merchandise Presentation Planning Key psychological factors to consider when merchandising stores: Value/fashion image Angles and sightlines Vertical color blocking LO 3

Exhibit 13.10- 45-Degree Customer Sightline LO 3

Exhibit 13.11 - Vertical Color Blocking

Selecting Fixtures and Merchandise-Presentation Methods Proper fixtures should Emphasize the key selling attributes of merchandise while not being overpowering Match to the merchandise LO 3

Visual Merchandising Artistic display of merchandise Theatrical props used as scene-setting decoration in the store Located in a focal point, feature area LO 3

Store Design Creates a distinctive and memorable store image Includes both exterior and interior of the store Exterior- Storefront, signage, and entrance Interior- Architectural elements and finishes on all surfaces Ambience Overall feeling or mood projected by a store through its aesthetic appeal to the human senses

Store Design Storefront design Identifies the name and general nature of the store Gives some hint as to the merchandise inside Includes all exterior signage and the architecture of the storefront itself LO 4

Store Design Interior design The finishes applied to surfaces The architectural shapes LO 4

Store Design Lighting design Helps enhance store sales Requires an in-depth knowledge of: Electrical engineering and the effect of light on color and texture Sounds and smells: total sensory marketing Effective store design appeals to the human senses of sight, hearing, smell, and touch LO 4

Visual Communications Name, logo, and retail identity Must be catchy, memorable, and reflective of the retailer’s merchandising mission Institutional signage Describes the merchandising: Mission, customer service policies, and other messages on behalf of the retail institution LO 5

Visual Communications Directional, departmental, and category signage Are large and placed fairly high, so they can be seen throughout the store Category signage is: Smaller Intended to be seen from a shorter distance Located on or close to the fixture itself LO 5

Visual Communications Point-of-sale signage (POS) Small signage placed very close to the merchandise Gives details about specific items Clearly states the price of the merchandise being signed LO 5

Visual Communications Lifestyle graphics - Portray the merchandise: As it is being used Through images of related items or models that convey an image conducive to buying the product Lifestyle photography Must be kept general so as to be attractive to the majority and offensive to none LO 5