An article in the February 20th edition of The Wall Street Journal documents a change in direction of determining shelf-placement of products in supermarkets. There has been a progressive shift from relying on data and suggestions provided by manufacturers and suppliers to self-directed programs.

The availability of sophisticated capabilities to monitor consumer behavior and purchase patterns have provided stores with the ability to establish their own shelf placement. An example is the use of monitoring customers by camera with images linked to software that generates patterns for product selection including “walk rates” Algorithms then generate recommendations that are used to place items for optimal turnover and profitability.

The advent and acceptance of private brands offering higher margins has entered the retail equation and shifted placement decisions in favor of retailers to the disadvantage of suppliers of national brands.

It is evident that services provided by large suppliers including Campbell Soup, General Mills, Hershey’s and Clorox together with their slotting fees have diminished in significance.  House brands and retailers’ placement patterns are impacting producer margins as evidenced in comments accompanying quarterly and annual reports of the major packers and suppliers of food.

While eggs are confined to display coolers, the same principles relating to position apply as on shelves in the center of the store.  This has significance in terms of the composition and design of packaging and accompanying visual or electronic shelf pricing and point-of-sale displays.