{"id":2214,"date":"2018-03-28T16:13:18","date_gmt":"2018-03-28T16:13:18","guid":{"rendered":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/?post_type=chapter&#038;p=2214"},"modified":"2024-04-25T03:06:36","modified_gmt":"2024-04-25T03:06:36","slug":"design-and-controlling-costs","status":"publish","type":"chapter","link":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/chapter\/design-and-controlling-costs\/","title":{"raw":"Design and Costs","rendered":"Design and Costs"},"content":{"raw":"<div class=\"textbox learning-objectives\">\r\n<h3>Learning Objectives<\/h3>\r\n<ul>\r\n \t<li>Describe how a store can use design to control costs<\/li>\r\n<\/ul>\r\n<\/div>\r\nIf a store layout can drive sales, it can also help you control your costs. Let\u2019s take a look at a couple of examples.\r\n<h2>Angular Layout<\/h2>\r\n<img class=\"wp-image-5084 alignright\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/2986\/2018\/03\/23175359\/StoreLayouts_Angular.jpg\" alt=\"floor plan with circular and oval shaped tables\/shelves.\" width=\"301\" height=\"169\" \/>An angular layout can help you control inventory costs. As we mentioned above, angular layouts allow for the display of a minimal amount of merchandise and is particularly good for high end clothing and jewelry. While the fixtures to display the merchandise are likely going to be more expensive, this also means that you have to have less merchandise on hand. When you sell diamonds or fur coats, this is a plus. As a retailer, you don\u2019t want all your cash flow tied up in the merchandise on you floor, particularly when the price point doesn\u2019t allow it to move as quickly.\r\n<h2>Diagonal Layout<\/h2>\r\n<img class=\"alignright wp-image-5086\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/2986\/2018\/03\/23175447\/StoreLayouts_Diagonal.jpg\" alt=\"floorplan with shelves in diagonal rows\" width=\"300\" height=\"173\" \/>We mentioned that the diagonal store layout allowed for a maximum amount of merchandise to be displayed for the customer but it also improves the customer\u2019s line-of-sight, allowing him to see much more when he enters the store. The same holds true for the cashier, who, when placed at one end of the store, can see more merchandise and customer activity. This allows for easier monitoring of shoplifting and theft. Shrink (the term retailers use for lost, stolen, or damaged product) is a significant concern for a retailer.\r\n<h2>Grid Layout<\/h2>\r\n<img class=\"alignright wp-image-5083\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/2986\/2018\/03\/23175329\/StoreLayouts_Grid.jpg\" alt=\"floorplan with shelves in rows\" width=\"300\" height=\"167\" \/>Grid layouts allow for maximized promotions. You\u2019d think that a retailer can decide if he or she is going to offer a product at a certain percentage off, but that\u2019s not always the case. Manufacturers frequently \u201csponsor\u201d promotions with additional cash to help move their product. They pay for premium \u201creal estate\u201d within a store in order to prominently display their products. This saves the retailer the cost of putting the item on sale himself.\r\n\r\nThe grid layout allows for predictable focus points, allowing you to display promotions in spots where you know they\u2019ll be seen. This allows the retailer to maximize profits and make use of that money manufacturers offer to minimize their margin losses.\r\n\r\nThe racetrack layout is also an excellent format for maximizing promotions.\r\n<div class=\"textbox tryit\">\r\n<h3>Practice Questions<\/h3>\r\nhttps:\/\/assess.lumenlearning.com\/practice\/fa192160-c0d4-42af-9ddb-7d8bd7b62d3c\r\n<\/div>","rendered":"<div class=\"textbox learning-objectives\">\n<h3>Learning Objectives<\/h3>\n<ul>\n<li>Describe how a store can use design to control costs<\/li>\n<\/ul>\n<\/div>\n<p>If a store layout can drive sales, it can also help you control your costs. Let\u2019s take a look at a couple of examples.<\/p>\n<h2>Angular Layout<\/h2>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"wp-image-5084 alignright\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/2986\/2018\/03\/23175359\/StoreLayouts_Angular.jpg\" alt=\"floor plan with circular and oval shaped tables\/shelves.\" width=\"301\" height=\"169\" \/>An angular layout can help you control inventory costs. As we mentioned above, angular layouts allow for the display of a minimal amount of merchandise and is particularly good for high end clothing and jewelry. While the fixtures to display the merchandise are likely going to be more expensive, this also means that you have to have less merchandise on hand. When you sell diamonds or fur coats, this is a plus. As a retailer, you don\u2019t want all your cash flow tied up in the merchandise on you floor, particularly when the price point doesn\u2019t allow it to move as quickly.<\/p>\n<h2>Diagonal Layout<\/h2>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignright wp-image-5086\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/2986\/2018\/03\/23175447\/StoreLayouts_Diagonal.jpg\" alt=\"floorplan with shelves in diagonal rows\" width=\"300\" height=\"173\" \/>We mentioned that the diagonal store layout allowed for a maximum amount of merchandise to be displayed for the customer but it also improves the customer\u2019s line-of-sight, allowing him to see much more when he enters the store. The same holds true for the cashier, who, when placed at one end of the store, can see more merchandise and customer activity. This allows for easier monitoring of shoplifting and theft. Shrink (the term retailers use for lost, stolen, or damaged product) is a significant concern for a retailer.<\/p>\n<h2>Grid Layout<\/h2>\n<p><img loading=\"lazy\" decoding=\"async\" class=\"alignright wp-image-5083\" src=\"https:\/\/s3-us-west-2.amazonaws.com\/courses-images\/wp-content\/uploads\/sites\/2986\/2018\/03\/23175329\/StoreLayouts_Grid.jpg\" alt=\"floorplan with shelves in rows\" width=\"300\" height=\"167\" \/>Grid layouts allow for maximized promotions. You\u2019d think that a retailer can decide if he or she is going to offer a product at a certain percentage off, but that\u2019s not always the case. Manufacturers frequently \u201csponsor\u201d promotions with additional cash to help move their product. They pay for premium \u201creal estate\u201d within a store in order to prominently display their products. This saves the retailer the cost of putting the item on sale himself.<\/p>\n<p>The grid layout allows for predictable focus points, allowing you to display promotions in spots where you know they\u2019ll be seen. This allows the retailer to maximize profits and make use of that money manufacturers offer to minimize their margin losses.<\/p>\n<p>The racetrack layout is also an excellent format for maximizing promotions.<\/p>\n<div class=\"textbox tryit\">\n<h3>Practice Questions<\/h3>\n<p>\t<iframe id=\"assessment_practice_fa192160-c0d4-42af-9ddb-7d8bd7b62d3c\" class=\"resizable\" src=\"https:\/\/assess.lumenlearning.com\/practice\/fa192160-c0d4-42af-9ddb-7d8bd7b62d3c?iframe_resize_id=assessment_practice_id_fa192160-c0d4-42af-9ddb-7d8bd7b62d3c\" frameborder=\"0\" style=\"border:none;width:100%;height:100%;min-height:300px;\"><br \/>\n\t<\/iframe>\n<\/div>\n\n\t\t\t <section class=\"citations-section\" role=\"contentinfo\">\n\t\t\t <h3>Candela Citations<\/h3>\n\t\t\t\t\t <div>\n\t\t\t\t\t\t <div id=\"citation-list-2214\">\n\t\t\t\t\t\t\t <div class=\"licensing\"><div class=\"license-attribution-dropdown-subheading\">CC licensed content, Original<\/div><ul class=\"citation-list\"><li>Design and Costs. <strong>Authored by<\/strong>: Freedom Learning Group. <strong>Provided by<\/strong>: Lumen Learning. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by\/4.0\/\">CC BY: Attribution<\/a><\/em><\/li><li>Store Layout Diagrams. <strong>Provided by<\/strong>: Lumen Learning. <strong>License<\/strong>: <em><a target=\"_blank\" rel=\"license\" href=\"https:\/\/creativecommons.org\/licenses\/by\/4.0\/\">CC BY: Attribution<\/a><\/em><\/li><\/ul><\/div>\n\t\t\t\t\t\t <\/div>\n\t\t\t\t\t <\/div>\n\t\t\t <\/section>","protected":false},"author":62559,"menu_order":5,"template":"","meta":{"_candela_citation":"[{\"type\":\"original\",\"description\":\"Design and Costs\",\"author\":\"Freedom Learning Group\",\"organization\":\"Lumen Learning\",\"url\":\"\",\"project\":\"\",\"license\":\"cc-by\",\"license_terms\":\"\"},{\"type\":\"original\",\"description\":\"Store Layout Diagrams\",\"author\":\"\",\"organization\":\"Lumen Learning\",\"url\":\"\",\"project\":\"\",\"license\":\"cc-by\",\"license_terms\":\"\"}]","CANDELA_OUTCOMES_GUID":"1386b8ef-c0ac-4ae3-a0e5-a980e371ff20, e1d1c764-bced-4080-a47e-1fba70020b46","pb_show_title":"on","pb_short_title":"","pb_subtitle":"","pb_authors":[],"pb_section_license":""},"chapter-type":[],"contributor":[],"license":[],"class_list":["post-2214","chapter","type-chapter","status-publish","hentry"],"part":2203,"_links":{"self":[{"href":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/wp-json\/pressbooks\/v2\/chapters\/2214","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/wp-json\/pressbooks\/v2\/chapters"}],"about":[{"href":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/wp-json\/wp\/v2\/types\/chapter"}],"author":[{"embeddable":true,"href":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/wp-json\/wp\/v2\/users\/62559"}],"version-history":[{"count":15,"href":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/wp-json\/pressbooks\/v2\/chapters\/2214\/revisions"}],"predecessor-version":[{"id":6524,"href":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/wp-json\/pressbooks\/v2\/chapters\/2214\/revisions\/6524"}],"part":[{"href":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/wp-json\/pressbooks\/v2\/parts\/2203"}],"metadata":[{"href":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/wp-json\/pressbooks\/v2\/chapters\/2214\/metadata\/"}],"wp:attachment":[{"href":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/wp-json\/wp\/v2\/media?parent=2214"}],"wp:term":[{"taxonomy":"chapter-type","embeddable":true,"href":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/wp-json\/pressbooks\/v2\/chapter-type?post=2214"},{"taxonomy":"contributor","embeddable":true,"href":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/wp-json\/wp\/v2\/contributor?post=2214"},{"taxonomy":"license","embeddable":true,"href":"https:\/\/courses.lumenlearning.com\/wm-retailmanagement\/wp-json\/wp\/v2\/license?post=2214"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}