How to Save Money on Your Next POP Display
American poet Robert Frost once wrote: “The afternoon knows what the morning never suspected.” Frost was suggesting that while it is often impossible to know what lies ahead, we can know more, have greater certainty, and plan better with the benefit of hindsight and experience. That is true in life and also with custom POP displays. In 2019, who could have predicted COVID-19 and the impact it would have on retail sales and world economies? Some things are just unknowable.
On the other hand, some things are knowable with great certainty. We know, for example, that when it comes to POP displays, size matters. Understanding what’s behind this timeless retail truth can save you money on your next custom POP display project. Be careful not to make it too big since it may limit the universe of retailers who might accept your display while also negatively impacting the all-important sales per square foot metric. If you make it too small, you risk getting lost in the hyper competitive category in which you compete. And, as we all know, making your display too tall is a cardinal sin punishable by death and strictly enforced by a retailer’s line of sight police, one of the few police departments not at risk of being defunded.
While there are obviously many considerations that go into determining the optimal size of a POP display, in today’s post we will focus on two knowable factors that can have a significant impact on your display program economics and return on investment of your display. Those factors are: (1) material yield, and (2) box size. It is surprising to us how many of our customers fail to consider these factors in the early stages of a POP display design.
Maximizing Material Yield
Material yield comes into play primarily with sheet goods such as plywood, MDF, acrylic, PVC, sheet metal and similar materials that come in sheets. It also is a factor with materials such as solid wood or lumber that can be purchased in various lengths (measured in board feet) or fabric that gets sold by the yard. It is less relevant for materials like wire or hardware.
To illustrate the importance of yield, let’s consider a custom POP shelf display. The design you envision has 8 MDF shelves and you would like each shelf to be 25” long x 13” deep. See anything wrong with that requirement? The answer is yes.
The material yield on those shelves is terrible. The reason is that most sheet goods come in 4’x8’ sheets. What that means is that you will be only be able to get 9 shelves out of a sheet. Instead, if you made your shelves 23.75” x 11.75”, you would be able to get 16 shelves out of a sheet- a 78% increase in yield and almost double the number of shelves. The impact of that change is that it drops your material cost per shelf almost in half which can make a big difference in the overall cost of your display. If you are paying attention, you might ask why you can’t make the shelves 24”x12” and still get 16 shelves out of a sheet. The reason is you need to account for the thickness of the blade when you cut the shelves which typically reduces the size by about ¼”.
It is good practice to be intentional about material yield and to discuss it with your POP display supplier since there are some exceptions to sheet size that can impact yield economics. For example, Baltic Birch plywood can be purchased in 5’x5’ sheets which completely changes the calculus of yield planning. However, China Birch plywood is generally not available in 5’x5’ sheets so it is important to select a display company that has the experience to guide you through material selection and yield optimization.
Optimizing Box Size
The second factor that can impact the economics of your custom retail display is box size. It is said that good things come in small packages, and when it comes to display economics, that is generally true. The main point to consider with respect to box size relates to shipping cost. For many of our customers, shipping costs are an afterthought. While they understand that shipping is a significant component of the total delivered cost of a display, they often don’t think about it during the design phase. However, thinking carefully about box size can impact shipping cost in a similar way that optimizing yield affects material costs.
For example, let’s say you are designing a counter display that will fit in a box that is 17”W x 21”D x 9”H. Your program involves shipping to retailer distribution centers on standard 40”x48” pallets. This particular retailer has a pallet height restriction of 60”. In this case you can fit 24 displays on a pallet. If, however, during the design process you could make the sign holder removable, decrease the depth of the shelves, or make the display slightly more knock-down, for example, you might be able to reduce the box size to 16”W x 20”D x 8”H. By shrinking the box by 1” in each direction, you can now fit 42 displays per pallet or 75% more. If it costs you $500 per pallet to ship your display to the retailer DC, your shipping cost per display under the first scenario is $20.33 while your shipping cost with the smaller box is $11.91- nearly less than half as much. It’s counterintuitive, but with shipping it is often cheaper to ship a heavier pallet than a light pallet so adding extra displays to the pallet is not likely to increase the shipping cost.
There are lot of factors to consider in designing a successful display program, but two knowable factors that you should be thinking about during the initial design process are material yield and box size. Being smart about optimizing these factors can result in significantly improved custom POP display economics.
Jim Hollen is the owner and President of RICH LTD. (www.richltd.com), a 35+ year-old California-based point-of-purchase display, retail store fixture, and merchandising solutions firm which has been named among the Top 50 U.S. POP display companies for 9 consecutive years. A former management consultant with McKinsey & Co. and graduate of Stanford Business School, Jim Hollen has served more than 3000 brands and retailers over more than 20 years and has authored nearly 500 blogs and e-Books on a wide range of topics related to POP displays, store fixtures, and retail merchandising.
Jim has been to China more than 50 times and has worked directly with more than 30 factories in Asia across a broad range of material categories, including metal, wood, acrylic, injection molded and vacuum formed plastic, corrugated, glass, LED lighting, digital media player, and more. Jim Hollen also oversees RICH LTD.’s domestic manufacturing operation and has experience manufacturing, sourcing, and importing from numerous Asian countries as well as Vietnam and Mexico.
His experience working with brands and retailers spans more than 25 industries such as food and beverage, apparel, consumer electronics, cosmetics/beauty, sporting goods, automotive, pet, gifts and souvenirs, toys, wine and spirits, home improvement, jewelry, eyewear, footwear, consumer products, mass market retail, specialty retail, convenience stores, and numerous other product/retailer categories.