category management (SCM) (CM)

Category Management(CM) is the management of merchandise groups as strategic business units. The products of a retail company are defined from the customer's point of view and grouped together as merchandise categories.

The redefinition of product groups is based on a nine-stage process and defines, among other things, product group roles such as the destination category with which a retailer can distinguish itself to its customers.

Category management is closely related to the Efficient Consumer Response concept( ECR) and thus to comprehensive cooperation between industry and retail along the value chain. Within the framework of Efficient Consumer Response, Category Management is, alongside Supply Chain Management( SCM), one of the key areas of cooperation with the three basic ECR strategies: Efficient Store Assortment, Efficient Product Introduction and Efficient Promotion. Studies show that companies that apply category management can realize higher sales through more attractive assortments. E-commerce companies such as Amazon and Zalando successfully apply CM techniques.