Increasingly we are seeing shorter planning horizons intimeline4-300x270the retail industry. This frequently directly impacts the success of point-of-purchase display programs. The purpose of today’s blog is to discuss the importance of planning head in creating successful retail display programs.
Start Early and Plan for the Unexpected
We know it is not always possible to plan ahead when developing a retail display program, but whenever possible, we recommend engaging in a strategic and thoughtful process to develop your in-store merchandising program. We understand that when opportunity knocks, in many cases you have to move quickly to take advantage of retail space that you have been offered or to meet the needs of a seasonal or promotional opportunity. Because we know customers have different timing needs, we offer a range of solutions to meet those needs- from in-stock fixtures and domestic production for quick turnaround situations to overseas manufacturing for longer lead time projects.
Understanding the POP Display Development Process
Generally, we recommend planning on a minimum of 90-120 days to develop and implement a custom retail fixture program. Although every custom POP display is different, the following are timing guidelines that may be helpful in the planning process. Note that these timing guidelines are based on projects with RICH LTD. and may differ for other POP companies:
• Concept Development- 1-1.5 weeks. This varies according to the complexity of the display rack, but for most projects you should expect to receive a concept and a quote within this timeframe. Having a clear set of design requirements coupled with a realistic budget, providing detailed information about your product(s), and knowing your expected quantities will help to facilitate this process.
• Prototyping 2-3 weeks. Once there is clear agreement on a concept and the quote is acceptable, the next step is prototyping. This can generally be done within 2 weeks, but it is probably good to plan on 3 weeks in case extra time is required for shipping and logistics. The prototyping time is about the same for samples made in our domestic millwork operation and for samples we make overseas assuming that the overseas samples are sent via air freight. Some of our customers have more time and prefer to send prototypes by container to avoid the expense of air freight so that could add an extra 3 weeks to the prototyping process.
In many cases the prototype can be approved as is or with minor changes that can be made in production; however, in some cases customers decide they would like to make more significant changes which may require another prototyping cycle. Therefore, we advise customers to allocate more time to the prototyping phase to ensure they have enough time to get their POP display exactly the way they want it before starting production. In some cases when the timeline is very tight, we can shorten the process by providing a first article of production rather going through a second prototyping process. If the display is not too complex, some of our customers have felt comfortable approving prototypes via detailed photos as a way to shave off a few days in the prototyping process.
Production- 4-5 weeks for domestic millwork production or 8-10 weeks for overseas production. These are general guidelines for planning purposes. Actual timeframes depend on project complexity, number of units, production schedules, material requirements and a number of other factors. For millwork projects produced in our Oceanside, CA millwork operation, 4-5 weeks is typical for most projects. For some projects we can start shipping earlier while other projects that require special materials may require a little more time. Most of our overseas POP projects can be produced within 45 days of receiving a purchase order, but after factoring in ocean transit time and logistics, the total elapsed time is typically about 8-9 weeks before the production units arrive in our warehouse in the San Diego area. From there it could take another week to get to the customer or a distribution center depending on the specific shipping location. In some cases, we also drop ship to individual stores which could add 2-3 days to the process if there are a lot of stores.
The Benefits of Planning Ahead
Given the development and production process outlined above, there are a number of significant benefits of planning ahead, including:
• A better POP Design- The more time you have to develop and tweak your POP design, the better the design will be. When the design process is rushed, you may be forced to make compromises or tradeoffs that you would not otherwise have to make if you had more time. As with anything, the more time you have, the less likely you are to make mistakes and the better the outcome.
• Lower Manufacturing Costs– Many customers who have extremely tight timelines are forced to produce their POP displays domestically. Although for many retail wood fixtures the difference in cost between domestic and overseas production is minimal, there is still a significant difference in manufacturing cost between domestic and overseas manufacturing for metal displays and acrylic displays. These differences tend to be in the range of 25%-40% depending on the specific project. So allowing enough time for overseas manufacturing is one of the best ways to improve the economics of your POP display program.
• Lower Transportation Costs- Allowing enough time for shipping and logistics can help avoid unnecessary cost overruns due to expedited shipping. To meet tight in-store dates, some customers have to air freight displays from overseas, which is an extremely expensive proposition and one that can dramatically change the overall economics of a display program. Similarly, if it becomes necessary to ship displays overnight, 2-day, or 3-day, shipping costs can consume a much higher percentage of the display program budget than is necessary. Allowing enough time for regular ground transportation is always the best option whenever possible.
• Better Chance of Hitting Committed Dates- Planning ahead will also increase the chances of making key in-store and rollout dates. Hitting dates can not only help to avoid possible penalties and ill will on the part of retailers, but it means the displays can be placed in stores on time so they can start generating sales.
In developing a POP program timeline, it is always smart to build in time for things to go wrong. Anticipating problems that can affect the timeline will help to ensure that you meet your timeline without spending extra money unnecessarily. Some examples of things that could go wrong and negatively impact your project timeline include:
• Unanticipated shortage of materials
• Unexpected machine downtime
• Unavailable capacity due to higher than normal demand
• High reject rate during the Quality Assurance process resulting in unplanned amounts of rework
• Weather-related production or transportation delays.
Plan for Overseas Holidays
If you are planning to have your POP displays manufactured overseas, it is especially important to plan for holidays since they can have an impact on production and shipping schedules. The granddaddy of all worldwide holidays is Chinese Lunar New Year which typically occurs in late January or February and lasts for about 15 days. In our experience, however, the impact of Chinese New Year (CNY) is more than just a 2-week delay. Production and shipping schedules tend to get jammed with orders trying to ship before CNY, raw material suppliers begin shutting down as early as 2 weeks before the official start of the holiday, and many workers extend the holiday and often do not return to their factory job. In recent years as workers in China have gained more power, the lost production time from CNY has increased so planning on 3-4 weeks of lost production or reduced production output is wise.
While most customers are aware of Chinese New Year and plan in advance for it, what many do not realize is that there are other holidays that can also impact production schedules. In fact, there are approximately 27 National Holidays or Common Local Holidays that occur throughout the year in China. In addition to CNY, these include holidays such as Labor Day, Dragon Boat Festival, Mid-Autumn Festival, National Day, and Qing Ming Je holiday. China is a hardworking, industrious society, but they do like their holidays so it is best to plan for them.