Dutch supermarkets stand to gain 600 million euro in turnover if they rearrange their selves and provide a better product range of dry groceries. That is a 3 % increase in turnover, according to a Nielsen report.
Drinks and home care
The potential turnover gain in drinks alone would be 116 million euro, up 3 %, just by offering the consumer more beer and soda options and fewer warm drinks and wine. Beer is a trendy consumer product and is developing plenty of product innovations, while wine is reaching its saturation point in supermarkets.
Home care also stands to gain 23 million euro in turnover (+ 5 %) if it provides a better variation in its product range and lowers its range by 6 %, according to Nielsen Benelux’ regional consultant for Sales Effectiveness, Dewy Heiser.
Product range growth does not always equal turnover growth
Some categories achieve product range growth, but not necessarily in turnover. However, there are turnover opportunities to be taken in different categories if the shelves are used differently and the product variation is optimized. It is important to add more products in trendy categories and branches, but there is a saturation point, which results in a product overload and that may have a negative impact on sales.
Sales can grow on the back of a product range mixture that supports innovation and avoids saturation. Additional turnover is possible if stores balance their categories over the right number of shelves and have a performant mixture of name brands and private labels.
These developments are also visible in other European countries. “In 8 out of 10 European examples, we see an increased product range variation followed by an increased turnover. However, in the Netherlands, that is only true for 6 out of 10 examples”, Dewy Heiser said.
“Consumers have more choices in the food industry. New products, but also a growing number of stores with more store space, have given consumers more choice. A larger product range does not mean turnover growth will be similar, however. One needs to make the right choices to give all the categories the right amount of shelf space and to choose the right product mix in each of those categories. Those will give both retailers and manufacturers increased opportunities to generate more turnover”, Nielsen Benelux’ Sales Effectiveness Director, Roberto van Taunay, said.
