CASE STUDY

Category Management Case Study: How it helped a Leading Wine and Spirits Retailer Develop a Precise Category Management Plan

Jul 26, 2018

Engagement Overview:

The client, a leading wine and spirits retailer wanted to enhance their category management strategies. Additionally, the client was looking at modifying their category management strategies to address the changes in the global retail sector. To do so, the wine and spirits retailer approached SpendEdge to help them leverage it’s strong expertise in category management to address challenges arising due to their inefficient category management strategies.

This category management engagement entailed the use of a detailed quantitative analysis of various supply chain categories to identify and benchmark the best suitable category management strategies.

About the Client:request proposal

A leading player in the retail sector.

Business Challenge:

The retail sector is in the midst of a profound cultural and structural shift toward a hybrid digital environment. This along with the availability of huge volumes of market data accelerated the need for major transformations in the client’s category management strategies.


How did SpendEdge Help the Client?

  • Step 1: Defining the category and the role of each category

The initial step revolved around the process of defining the role of each category within the wine and spirits segment. This helped the wine and spirits retailer to gain a better understanding of the various categories in their organization. By doing so, the client was able to prioritize each category and understand the importance of each category in driving their profit margins.

  • Step 2: Fine-tuning category management strategies to meet the organizational objectives

Category management strategies are aimed at increasing market share, improving ROI, enhancing sales, and increasing customer satisfaction. The client’s category management strategies required massive changes to ensure they meet their organizational goals and objectives. This step involved the detailed assessment of different categories to help the client develop precise strategies to drive category growth.

  • Step 3: Assessing the cost of the devised category planrequest proposal

The penultimate step in category management deals with the processes involved in accessing the cost of the category plan against its benefits. To implement any category plan it is essential to ensure you’ve got it right by assessing its impact. This includes the implementation of a schedule around how the plan will be executed as well the securing the resources required to do so.

  • Step 4: Implementation and review of the devised category plan

The scrupulous four-step approach to category management enabled the wine and spirits retailer to scrutinize their strategies to ensure they meet their category goals and objectives. Though category review is not an essential step in the process of category management, it is highly recommended to include it throughout the entire process.


Benefits of the Engagement:

The devised category management plan enabled the wine and spirits retailer to enhance the strategies involved in the end-to-end management of the supply chain. The adopted approach also enabled them to effectively organize the procurement resources to focus on specific areas of spend. This further helped their category managers to focus on conducting an in-depth market analysis to entirely leverage their procurement decisions on behalf of the organization.

Why is category management essential in the retail sector?

The growing competitive pressure in the retail sector poses major challenges for players in terms of effectively managing different categories to drive profitability. This makes it necessary for them to rethink their approach to targeting customers.

However, over the next few decades, the best practices in retail category management will be focused on enabling a faster response to changing market conditions. This means that category management will transition from a rules-driven paradigm to a learning model enabled by machine learning and other advancements. In this new era, retailers will need to enhance their strategies and function at a faster tempo than their industry peers by understanding and anticipating customer behaviors. Moreover, understanding the why, what, how, and where of consumer’s buying patterns will allow them to think like a customer but act like a retailer. This new reality will leverage the need for a category management plan that facilitates agile decision making and supports rapid strategic shifts.Request Demo

Due to such factors, leading companies are now approaching SpendEdge to leverage our market expertise in developing advanced category management plans to drive organizational value. Also, with the help of our category management solutions, it is now possible to align category management strategies with business objectives, which go hand in hand in helping companies enhance market presence.


Key questions answered in this category management engagement

wine and spirits

 Our Findings:

As procurement functions continue to evolve toward a strategic function across industries, procurement leaders and other procurement officials are regularly assessed based on their team’s strategic contributions to the overall business. Therefore, to maximize their procurement efficiency, best-in-class procurement firms are turning to category management as an effective lever to drive strategic value and growth across different procurement categories.

Moreover, a structured approach to category management such as the one developed in this engagement can not only help you improve profit margins, but also helps improvize supplier performance, mitigate risks in the supply chain, and drive innovation. If your organization is on the lookout for an objective way to drive category growth, SpendEdge’s category management solutions will help you do so by being your roadmap to success.

Doesn’t this sound intimidating? It’s time to start making the necessary changes in your category management strategies. Get in touch with our experts to build a category management capability that will position your company for continued success.


 To know more about our category management solutions for beverage industry players

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