Our Expertise

Thriving in today’s business environment requires strategic decisions based on sales examination and consumer knowledge. The Perishables Group provides the tools to guide a business to success.

The key to any decision is a thorough understanding of marketplace drivers and trends. The Perishables Group’s advanced analytics team combines multiple data sources to create the strategic insights and tactical recommendations for specific business issues. The analytical information used as available includes:

• Point-of-sale data
• Household panel data
• Fresh Foods Library comprised of Perishables Consumer Profiles
• Custom consumer research
• Client-supplied data

Statistical models and techniques valuate the impacts of historical situations (promotion, price changes, store demographics, etc.) on the health of a business and provide insight into areas of opportunity. The analytical services team combines expertise in the unique properties of perishable data with custom analytical tools to provide the following services:

• Promotion, merchandising and assortment analysis
• Category A to Z benchmarking
• State of the Department benchmarking
• Controlled store test matching and analysis
• Activity-based costing modeling
• Price point and price gap studies
• Price elasticity modeling
• Custom ad hoc analyses
• Price and promotion modeling

 

Services

Category A to Z and State of the Department Benchmarking

The Perishables Group presents a complete look at targeted fresh departments and categories through store-level and item-level point-of-sale data, combined with household panel and demographic data. The information is delivered in a format adaptable for use in both internal meetings and outside sales presentations.

Benchmarking analytics address the following questions:

• What categories/segments are growing?
• Have prices risen or fallen?
• What portion of the sales is coming from incremental purchases versus baseline sales?
• Are baseline sales growing or eroding?
• How do the various regions compare in terms of department/category sales?
• Are sales shifting from one package type or size to another?
• Are the number of items in the category increasing or decreasing?

Activity-Based Costing Modeling

To fully understand the costs, resources, limitations, and retail climate associated with supply chain operations, the Perishables Group created an activity-based costing (“ABC”) model that can be used to determine areas of opportunity within a department and/or category. The model uses a database of observations at all stages of the supply chain (i.e. distribution center, transportation and in-store preparation) and merchandising activities to quantify storage, transportation, and labor costs. Also included are other available data sets, including point-of-sale (POS) syndicated data, shipment/shrink tracking and merchandising protocols. An ABC study investigates the following questions:

• What are the costs and profit drivers associated with a category?
• What are the most profitable product formats in a category?
• How many dollars are lost to category shrink occurring at the store?
• How can price and position of a product be changed if the ABC study shows the opportunity for labor or transportation savings over currently used product formats?

 

Promotion, Merchandising and Assortment Analysis

Integral to category management and development is an effective strategy for promotion, merchandising and assortment. Perishables Group analytics can shed light on the following issues to help better manage your business:

• What is the most effective type of ad for a product/category?
• What is the ideal frequency of promotion?
• Which items should be promoted together?
• What sales lift can be expected at each discount level?
• At what regular retail price point is volume maximized?
• How many subcategories/segments/items should be carried in the category?
• How much space should be allocated to the category/subcategory/segment?
• Where should the category be placed in the department?

Price Point Threshold and Price Gap Studies

The Perishables Group investigates price in the marketplace using a price point and price gap analysis of historical point-of-sale information. Executed at a regional or retailer level, sales rates are smoothed over price points so price thresholds are exposed. When an item is in direct competition with other items or brands, we hone in on consumer trade-offs at various price gaps.

This type of study is best for a basic look at the current pricing landscape in the marketplace, and can be used to answer the following questions:

• What is the most common price point for a category/item across the region or retailer?
• What is the sales rate across all price points?
• What are the threshold price points above which sales drop off?
• What are the most common price gaps for an item versus the competitor’s item?
• At which price gap do consumers switch from an item to the competitor’s item?

Pricing and Promotion Modeling

Marketplace pricing and promotion analysis sheds light on current marketplace pricing and promotional practices through price/promo report sets.

Everyday and promotional price threshold analysis uses base sales rate by price point/gap, and promotional lift by price point charts.

Price and promotional effectiveness analysis uses price elasticity to forecast a demand curve for sales across a range of price points for each item, competitor and geography.

Price Elasticity Modeling

The Perishables Group recommends a pricing elasticity study to fully understand pricing versus key competitors and to determine if a price increase is warranted, plus its potential impact.

This type of study provides a forecasted demand curve for sales dollars and volume across a range of price points, for each item and geography. The statistical model takes into account seasonality, store variations, competitive products, and promotional pricing effects. A price elasticity study investigates the following pricing issues:

• What retail price point maximizes volume?
• What retail price point maximizes dollars?
• How sensitive are consumers to price changes?
• What is the expected effect on sales dollars and volume if prices are higher/lower?

The Perishables Group tailors analysis to address the issues most pertinent to a client's business.