Space Management in Category Management – A Comparative Analysis of Retailers in the Subcategory of Pickled and Preserved Vegetables

Abstract

With raising number of products offered by manufacturers, and the same or smaller sales space, retailers are in constant quest for optimal model of allocating limited shelf space to list of products in assortment that will insure highest possible profit of a certain category but also of the whole retailer’s product assortment. Category management’s space management is offering some old approaches and new models for additional optimization of shelf space management on category level. This study aspires to investigate the state of shelf space management in retailing in Croatia and to clearly elaborate retailers’ category management and other principles in space management activity on category, segment and brand level. The paper aims to help food manufacturers, as well as small and family owned retailers in Croatia and in other developing countries to ease and facilitate navigation through the category management imposed by retailers. By using the method of observation and analysis of the share of shelf space and market share (sales) data, authors attempt to deductively draw conclusions on the implementation of space management principles at the level of category Pickled and canned vegetables. Observations and analysis are done through the case study of four retail companies. Research has shown that retailers in Croatia in sub-category of Pickled and canned vegetables use contemporary category management principles in extensive way, especially in shelf space management part. Although they have their own specificities, contemporary retailers give most credit to giving equal share of shelf space to product’s segment as its share of sale (or market share). Additional criteria were identified on brand level, namely private label’s management, relationships aspects, and assortment dynamics limitations. Findings should enable manufacturers to capture better position in the category, and possibly influence the category itself through better satisfaction of both retailers’, their own and consumers’ interests.