Friday, October 10, 2008    

November, 2000

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Overhead is Not Cost – It Brings Profit!

by Stephen J. Alexander
Guest Columnist

Stephen J. Alexander

Nothing in an automotive parts store should go to waste, or be unused. Not talent, time, energy, or any part of the valuable, limited space.

Savvy retailers often use their ceiling space for hanging signs. These may identify department locations, or call attention to special prices on selected items or promotions.

There is one other high-level area of in-store space which very few retailers or retail chains use to their advantage. In fact, some stores abuse this space.

It’s that space along walls and over the wall fixtures where the shoppers can’t reach -- the unreachable, therefore unshoppable, area just above the wall fixtures’ top which reaches up to the ceiling.

When you calculate the linear feet available between the typical 8’ wall fixture top and the typical 11’ foot ceiling in a 50’ by 100’ store, you come up with 300 running feet total…as a single shelf ringing the perimeter of the store, or 75 standard four four wide sections.

Using a standard rule-of-thumb of an average facing width of 5”, the holding power of just one shelf ringing the store’s perimeter equals 720 additional facings. With sufficient height to have three shelves ringing the store, the facings equivalent translates into 2,160 additional facings.

Wow! That is a lot of space which most auto parts retailers are not using for profitable purposes. They pay rent or mortgage payments on that space, too.

Yes, some stores use that space for overstock. Not a bad use if the overstock is neatly placed above the shoppable stock, and the packaging is placed so that consumers receive another product impression, or sighting of product which is available in-store.

Some retailers abuse that space, consigning it as “basement use” space, where damaged or dirty or broken items are stashed until it’s the day to ship that merchandise back to the warehouse or suppliers for credit, or until the in-store merchandising rep comes to work that department.

Cheap Overhead

USE SPACE ABOVE gondolas and wall fixtures to make a powerful store, brand, or product statement.

It can be done inexpensively, cheaply.

Shelving that high can be inexpensive to build, the labor to place that merchandise and keep it clean is already an in-store asset, and the acquisition of merchandise to place up high can be low.

That use is unsightly, to say the least. Not only is it an eyesore, but using that space that way in the retail selling environment is a definite waste of valuable space inventory.

Use that space as a billboard rather than a dumpster.

Three techniques can be used on that wall and air space asking about its purpose in in-store life!

  • First, that space can be used for a positioning or strengthening statement. Take one specific brand and load that space, one facing deep, with product.

This is like putting up one gigantic colorful sign which says “We sell this here.”

Above the oil section, take one, two, or three brands, and place those products, one deep, to present the customer with a striking identifiable picture of those brands. Three four-foot wide linear facings of three brands of oil will say to your shoppers, “Boy! Do we have oil for you! Here it is!”

Use the same technique to promote one supplier’s brand. Over the chemical stock, fill in that space, again one facing deep, with every inventoried SKU of a preferred vendor’s line.

Particularly when the business dress of that supplier is consistent in all its SKUs, the company logo, the shape of the bottles, the color will tell shoppers, “We have a whole lot of product from this company, whatever you need or want.”

On the filter wall, a store can build a very loud position for its leading supplier.

Some stores will use overstock to build this one-facing-wall. Others will ask their vendors for empty bottles or boxes for display in this unshoppable space asset. Since many manufacturers are accustomed to shipping empties for trade show displays, this may not seem an unusual request from a favorite customer. They will be happy to oblige.

  • Technique number two: retailers can build vertically rather than horizontally, up rather than across the overhead shelves.

Car covers, for example, can be nicely merchandised with attractively placed packages above the reachable stock area. These can extend across the entire category display, promoting one (or possibly two) brands so that sales of car covers can increase.


Customers respond positively to a well-presented repeated message. Using the unreachable space over shoppable product can emphasize a brand, can give the impression of depth of available merchandise, and beautify a retail auto parts store.

  • Technique number three: Ribbon merchandising. Again, the “build” is vertical. However, the to-the-top merchandise is built with empties or overstock, one (or two or three) facings across as is appropriate with the corresponding facings below.

This approach also extends the product statement by focusing on a particular style such as one flavor of sheepskin seat covers.

In wall fixtures where the top-to-floor SKUs are different products, or different sizes of the same product, the stacked-to-the-ceiling SKU should be the most profitable of the products directly below that ribbon.

The customer will see the colorful variety of SKUs above the fixture, get the impression of depth of available stock, and be attracted to the merchandise.

Adding merchandise with its colorful packaging above shoppable areas will warm the store esthetically, too, making it a friendlier looking place in which to shop, and to which to return. The friendliness impression may be a conscious or subconscious one, depending upon the shopper’s awareness of in-store techniques.

Retailers customarily think of overhead as rent, payroll, and utilities. That overhead is the overhead which costs money.

The physical overhead, where retailers can add selling power without adding a brick is the overhead which makes money.

Stephen J. Alexander, president of Automotive In-Store Marketing, is a member of Aftermarket Business’s Retail Advisory Board. He can be reached at his Sanibel Island, Fla. headquarters, phone (239) 395-9203, or e-mail salexander@autoinstore.com.

Visit Alexander at the Aftermarket Business AAPEX booth 4013 in the Sands Expo Center during the show.

COPYRIGHT NOTICE:"Reprinted with permission from Aftermarket Business, November, 2000, page 42. Copyright by Advanstar Communications, Inc. Advanstar Communications, Inc. retains all rights to this material." To subscribe to Aftermarket Business, call 1-218-723-9477 or email fulfill@superfill.com.



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