Here is a great post with some solid information by Lisa Gettling about the process and method behind small drug stores and their methods for clearing out clearance products.
Have you ever gone to Target and been able to find the exact same clearance item at every Target you visit, but do not have the same luck when going to multiple Walgreens?
Well there is a simple one word answer: “planogram.”
Think about it, when you walk into a Target in Ohio or Iowa they basically look the same. Drugstores are not the same. For this article I will use Walgreens as the example, but the principals can be applied to CVS and Rite Aid.
I walk into Walgreens in my town, which is located in strip mall and I am able to find a Dove deodorant on clearance for .99 cents. I drive to a Walgreens in the next city, which is a standalone store and cannot find the deodorant; instead I find it inline (on the shelf) in the deodorant section at full price!
Shouldn’t it be on clearance too?!?!?
This is where planograms come in.
A planogram is a map given to stores by corporate to tell them how to place the product on the shelves. With drugstores (and other stores) the planogram a store receives is often based on the size of their sections (Rule of thumb, the gray metal shelves typically are 3 feet wide).
Remember that I said I found the Dove deodorant at my Walgreens in a strip mall, but not the standalone store? This is because of size. A drugstore in a strip mall is smaller than a standalone location. What becomes even more complicated is not every standalone Walgreens is the same size.
This is where a little recon comes in. When you go into your drugstore, pay attention to the different section sizes. At my local Walgreens the soap section is only chest high, but at the store in the next town over it is as tall as I am. Right there that tells me these 2 stores are on different planograms.
Next look at the gray shelves how many across are they? I know this seems like a lot of information but if you frequent these stores you get to know which have identical planograms for the various sections in the stores.
Back to the Dove deodorant (no I am not a spokes person for Dove ☺ ), why did I find it for .99 cents at one store but not the other?
Everyone say it with me PLANOGRAM.
The store I found the .99 cent deodorant is a 6 foot section, and the other stores I looked at were 9 foot. So, this means it only was pulled from the 6 foot section planograms. When stores have smaller sections they are forced to do more clearance sales to accommodate the new products; they simply do not have the shelf space to handle the new products and must pull products to make room.
Once you learn the sizes of your sections you can hopefully predict which stores will have the items on clearance. I want item A and it came out of a 9 foot section 4 feet tall, and the Walgreens 2 towns over has the same planogram so I should be able to find it there.
Is this fool proof? Absolutely not, but I hope it explains why not every drugstore offers the same clearance.
Some Tips for Non-Seasonal Clearance
- Stay away from 24-Hour drugstores. A store becomes a 24 hour location based upon geographic location AND their sales volume. A 24 hour store sales volume is much higher; therefore they are not forced to put items on clearance as often to make room for new products.
- Stores routinely update planograms through two processes, just by pulling one or two items, or by doing an entire section reset (changing it all). These changes are dictated by corporate and stores are given a window to complete them.
- Drugstores have multiple clearance sections. Items are placed in special clearance sections, or left inline with a clearance tag. What does this tell you? Items are left inline on the shelves when the store does not have the new product yet. If you see just one or two clearance tags inline then the store is just changing out an item or two. If you see multiple tags, it is a good sign the entire section is going to be reset.
- Not every item that comes out of a planogram makes it to the clearance section. Some products are pulled and sent back to corporate to either be returned to the manufacturer or sold off to a liquidator.
- Take a picture of the clearance tag or write the amount down (do not remove tag from shelf) and watch the price as it rings up at the register. Since items tend to be clearance at the store level you will often find them ringing up as full price. Stay on top of it!
Bonus Drugstore Tips (non-clearance):
- Find out when truck day is for each of your favorite drugstore. Stores often run out of good sales items from their ads early in the week. Find out when the store is getting more inventory in (aka truck day) so you know when to go and snatch up additional product received by the store.
- Sign up for the store’s loyalty programs. Many sale prices are connected to these cards and require you to present them to receive the special price.
- At Walgreens, you can earn points to be redeemed for cash towards your purchases, however it is not well publicized by Walgreens that if you are making a transaction that earns points, DO NOT redeem any of your banked points if you do, you will NOT be credited with the points you earned on the transaction.
I hope I have given you a better understanding of drugstore clearance. Remember in the world of clearance size matters.
Ok, we need more posts from Lisa Gettling . Really good info that is really thinking outside the box.
Thank you. I learned a lot in my old job as a merchandiser.
Thanks Lisa, very useful info
This is a great explanation, not just of planograms, but also how planograms of individual shelves are related to whole retail store floor planning. You can separate one from the other. You can’t optimize sales on individual shelves until you optimize the floor space itself.