Category management is a collaborative practice exercised by retailers and manufacturers, in the consumer packaged goods (CPG) industry, to optimize the return on investment for a segment of retail geography or “category”. The process involves providing consumers the right product assortment, correct sizes, and appropriate inventory levels to optimize their shopping experience. Retail merchants, key account sales and category management professionals are the key players in this essential industry focused collaborative process.

In 2010 The Category Management Association (CMA) introduced a set of standards to the consumer packaged goods industry to govern the training and professional status of people involved in the category management process. The standards were created through the involvement of senior category management professionals representing over forty different companies and took two years to write. These standards have been in place now for six years.  Thousands of people are now certified at one of the following three different levels: Certified Professional Category Analyst (CPCA), Certified Professional Category Manager (CPCM) and Certified Professional Strategic Advisor (CPSA). The CMA has gleaned a great deal of knowledge about the value of certification to companies during this time.

First, Certification focuses an individual and their company on professional development. When care is taken with the professional development of employees, greater job satisfaction and improved retention rates are the result. It is easy to understand how improving the retention of just one employee, at the category analyst level, can lead to significant savings from reduced recruiting expense and reduced training expenses. These savings can easy exceed $40K. It is important to note, that figure doesn’t not account for the improved productivity which results from better directed training and better-prepared analysts.

Second, better direction of skill development at junior levels affords organizations the opportunity to optimize training programs by grouping individuals with like needs. The resulting training efficiency provides organizations with the opportunity to save thousands of training dollars. The CMA suggests that you consider having your organization assessed by an accredited training company before you begin training or certification. In that way you will benefit by grouping people and also save your people time in taking training that may not be required.

The CMA Certification Program enables organizations to align channel partners with similar skills, terminology and a common understanding of this important business practice. It enables retailers to understand the caliber of talent providing them category management services. When we consider the improvement in performance for both parties in the channel, it is easy to see that the Return on Investment for certification expenses can be significant.  Let’s consider one example using a small category with $500K in annual profit for a chain; the latest industry estimate is the improved performance in that category could be as much $50K or 10 to 1 ratio when compared to the certification cost for a 20 person team.

Certification is intended to provide all participants in category management specific direction to optimize professional development. Clearly we’ve learned that has indeed been the case, and those retailers and manufacturers that have certified teams working together do realize improved results based on the use of common language, common skills and the alignment of talent.

During 2018, the certification standards will be updated to reflect category management 2.0 and changes to the category management process. Certification testing will be revised to reflect those differences in the second half of 2018 all in an effort to maintain relevance of certification to current industry needs.

By Daniel P Strunk, Sr VP of Certification & Education, dstrunk@cpgcatnet.org, 312.342.1044