What is Category Management?

Category management is an important strategy for retailer operations and for retailer-supplier collaboration.

Category management is not new in the traditional industry, it is just rare in the field of e-commerce; in fact, the role of category management for e-commerce is very big, if the sales system is the foundation of e-commerce, then category management can be said to be an important means of e-commerce profitability.

Category management is through the analysis of consumer shopping preferences and shopping behavior, while analyzing the correlation and substitutability of goods, to develop the display of goods, pricing, promotions, management and other behavior of a management method.

Expanded Information:

Brand Management p>Procter & Gamble, a pioneer in brand management, has begun to adopt category management, as have many other leading companies. P&G's practice has proved the many advantages of category management. Traditional brand management systems are good at creating incentives by fostering internal competition among brand managers, but they can also lead to unhealthy competition for resources and a lack of coordination.

In contrast, the new management model is designed to ensure that all categories are adequately resourced. Another reason for implementing category management was the growing power of trade because retail trade was beginning to think of profitability in terms of product categories, and thus Procter & Gamble thought it wise to sell similar products.

Nowadays, category management is mostly carried out by suppliers who have the leadership ability to coach retailers **** with the implementation of category management, the initial planning is based on shelf management, through the POS information system and computers, the number of sales of products on each shelf and cost analysis, through the analysis of the data obtained by the product to determine whether it is necessary to increase or decrease the space on the shelves.

At the same time, through the shelf management to determine the appropriate amount of inventory and safety stock in each store, and after a certain period of time to obtain the growth rate and fixed sales and other information, and then store sales data back to the supplier, an effective response to the manufacturer, the appropriate amount of control of production and manufacturing, in order to reduce the amount of inventory and days of stock, etc., and these are the implementation of category management hope to further achieve.

Baidu Encyclopedia - Category Management