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Frito Lay Level 1 Certification

Training Module 1.1
Introduction
Welcome to the Archway/Frito-Lay Certified Merchandising Program. The objective for this program is to provide unparalleled execution for all Frito-Lay Projects. The key elements on which this program is focusing are:
• • • • • Developing team leader positions (600 National) to serve as leads or primary resources for all Frito-Lay Projects. Developing a national pool of trained Retail Representatives (approximately 4,000 National) to work with leads on multi-person projects. Certifying all Archway associates prior to Frito-Lay project assignments Training curriculum that combines classroom and in-store instruction Team leads to work with Frito-Lay RSRs in-store for final certification approval

Training Requirements: Must be certified prior to Frito-Lay project assignment and must recertify if less than 10 hours is spent on Frito-Lay projects during the first quarter.

Section 1: About Frito Lay
Frito-Lay began as two companies, the Frito Company and H.W. Lay and Company, in 1932. They merged in 1961, and joined PepsiCo in 1965. Today, Frito-Lay is the largest and fastest growing snack food manufacturer in the United States, with a 60% share in the core salty snack food market and revenues over $13 billion annually. Their brands include Doritos, Lays, Ruffles, Cheetos, Tostitos, Sun Chips, Cracker Jack, and Rold Gold, and many more. Frito-Lay’s success is built on the philosophy that the company’s highest goals can be achieved through people who believe in the company, and who gain satisfaction from work. Their goals are made clear in their mission statement: “To best satisfy America’s snacking needs by providing fun foods within arms’ reach of all customers”. To this end, the company strives to care for the people around them, sell only products they can be proud of, promote honesty and truth, balance short term and long term goals, be inclusive, and in succeeding as a team. About Frito Lay Brands 1 The brands of Frito Lay are broken into distinct categories: the Take Home or “salty snack” category, the Alternative category, and Single Serve, also known as “Front End Merchandisers”, or FEMs.

Section 2: The Tradition Of Service
Frito Lay has a reputation for exceptional service with unbeatable quality products. Customers expect the best, and the company focuses on their reputation by promoting strong character and integrity toward both the customer and the retailer. As a representative of Frito-Lay, you are the company. You must be the “Snack Food Expert”, with a professional approach and appearance. It is up to you to build and maintain good relationships at all levels with a positive, flexible, and “can-do” attitude. The Building Blocks for Success Of the five building blocks – Service, Distribution, Promotion, Merchandising, and Space – the foundation of them all is Service. Providing outstanding service means being friendly to your customers and their patrons, but
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See Brand Index at the end of this document
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more than that, it is getting to know your customer’s business philosophy and goals, finding ways to add value to their business, and taking action to fix problems without interfering with day to day operations. By taking personal responsibility for the success of your customer’s business, you make a positive impact on every aspect of your daily work, on your own reputation, and on the companies you represent. Outstanding service makes the difference!

Section 3: Building Relationships
This is the KEY to Frito-Lay’s success. It is more than just understanding the management structure and knowing who can make the decision. People tend to extend more grace to their friends than someone they consider a “vendor”. People care more when they believe you care about them, and they’ll defend and support you when they know you have their back. Moreover, when a person receives feedback from a friend, they’ll usually take it positively instead of being offended by a stranger’s criticism. Building relationships is critical with the customer, but also within the team you work with, both through Archway and with Frito-Lay. And don’t forget your store’s customers. Looking after them means you’re looking after the store. Building relationships starts with you. Be approachable, and take the time to introduce yourself. Exhibit warmth and sincerity. Smile. When you greet someone, use their name and shake their hand. Also, learn to relate to others: ask about their family, where they grew up. Be aware of major events in their life and ask about their interests. Sometimes this means adjusting your interpersonal style. Be aware of your facial expressions, the tone of your voice and your body language. Learn to listen to others, and be prepared to emulate someone else’s style. You must also treat others with respect. Be objective, and foster an environment of openness and trust. Confront problems, not people, and give others a chance to “save face”. Be sensitive to the people around you, and avoid crude or offensive topics. Maintaining positive relationships also means looking inward – allow others to speak first, and don’t become defensive. Give others the chance to suggest how, when, and with whom an issue may be resolved. The relationships you build day to day will determine your success, not only in your job, but in every aspect of your life.

Section 4: Elements of a Successful Store Visit
While Service sets you apart, knowing your role as a professional merchandiser is critical. You must understand your role and what is expected of you, be familiar with the proper procedures, observe safety rules, and always continue to build successful relationships. In the store you will interact with both management and customers, so a professional approach and appearance are important. You must be ready to do whatever it takes to get the job done, with a “can-do” attitude. This increases the value of your work, but it also increases your credibility and trust with all three companies – FritoLay, the retailer, and Archway. Take Ownership! Treat the work you do as if it were your business. You are the president and CEO of your store, and it’s success depends on you. Use the resources that are available to you through Frito-Lay and Archway, over-communicate using email and voicemail, and build lasting relationships with the retailer, its employees, and its customers. Store Call Procedure These are the fundamental responsibilities of your visit. Pay careful attention to each step, and make sure you understand them thoroughly. You are an extra pair of eyes and hands in the store to help Frito-Lay and the retailer build business.

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1. Review the Plan. It is important to understand the main objective. Read through all of your materials before you begin, and make certain they are clear. Check to see that you have everything you need to accomplish the objectives including necessary tools, supplies, fixtures, and product. If you have any questions, direct them to your manager or the store management right away, and determine who will approve your work before you begin. 2. Sign in and Greet. Sign in at the service desk and greet the store personnel. Greet all employees you encounter and maintain a friendly attitude. Touch base with the decision maker (Co/Grocery or department manager) each time you enter the store to discuss the current tasks and any issues. Continue to build those relationships! 3. Check Store Conditions. Are there any Out Of Stocks (OOS)? Check for Pullups (product needed to fill the shelf after you have filled OOS), discontinued items, new items, displays, and resets. 4. Prioritize Objectives. After checking store conditions, prioritize what needs to be accomplished first. Think through how you could best execute the sales plan, and plan your sequence of events before you execute. 5. Seek Management Approval. Review your plan of action with the appropriate manager, and agree to what you will accomplish in the store for that visit. Let the manager know you will check in as needed and when the project is complete. 6. Merchandise and Execute. There are several basic merchandising tasks you must always address: fill the shelves, replace tags as needed, check the planogram for compliance, face up all product, and Pop & 2 Lace . Keep on top of these while you execute the sales plan’s reset or display instructions. 7. Review Completed Work. Review the work you completed in store that day with store management. Review any actions that could not be accomplished, and agree on an expected time to complete them. If you need to take future action, let the store management know what you will accomplish next time, and provide a heads up of any actions you know will be happening soon. Don’t forget to thank the store manager for their time and opportunity to work in the store. In-Store Etiquette While you are in the store, you must remember that you represent the best of the companies you are working with and for. Recognize and always yield to customers. Help them if you can (within reason) including answering questions about product, even if it is one of Frito-Lay’s competitors. Acknowledge all store employees, and when you need one, track them down; don’t wait for them to happen by. Treat all employees with respect and courtesy – remember that you are a guest in their house. All the while, maintain a “can-do” attitude. It is also important to remember etiquette regarding equipment. Never leave a pallet unstable where it might fall and damage product or injure someone. Don’t place product on the floor – always use shopping carts or push carts, (and always verify that they’re not currently being used for something else). Never use product, cartons, or bays as a stool or a ladder. Never place overstock in the wrong bay, and never leave the Frito-Lay carts in front of the loading dock. Pick up and clean trash regularly, and always keep Frito-Lay boxes (knock-downs, or KD’s). Safety Because we value the safety, health, and well-being of each of our employees and the general public they come in contact with, safety policy is a high priority and we believe strongly that accidents and injuries can be prevented. At no time should the pursuit of company business jeopardize the safety of the public, or Archway or Frito-Lay employees. Safe Lifting
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Popping and Lacing is covered on page 5
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Back and joint injury is a common result of improper lifting. Don’t take the size or apparent weight of a box for granted; always follow these lifting principles. First, if you need help, get it! Always lift with your feet slightly wider than shoulder-width apart, and stay close to the load. Bend at the knee, not at the waist, and use both hands. Keep your back in a natural position and use your leg muscles to lift in a straight line motion. When pushing product, get the weight of your body behind it and use both hands – do not push with the inside of your legs. When kneeling, use a folded KD (knock down, or empty box) to reduce strain on your knees. General Safe Practices Always keep the work area clean and orderly – all totes, bunkers, flat-tops, carts, and other equipment must be pushed to one side of the aisle while you are working; the aisle must remain open to customers. Wipe up all spills immediately, or notify store personnel if you need additional help. Store all tools and supplies in their proper place, i.e. when a box cutter is not in use, the blade must be in the closed position, and locked with the guard in 3 place. Place trash in the proper containers – any KD’s that are being culled should be placed beside the bailer, not inside it. Do not stack totes more than four high, and when a tote is full, place it out of the aisle in its designated storage area. Use dollies or flat-tops to transport heavier totes, or to move more than one at a time. When pushing a dolly, keep your back straight and hold the handle with one hand, using the other to balance the top tote. Do not overload hand dollies, flat-tops, or bunkers! And as always, when in doubt, ask for help.

Section 5: Merchandising Essentials.
What is merchandising? Merchandising is the act of growing sales by influencing customers to make impulse purchases through presentation and product depth. Merchandising is not “maintaining” sales, it is designed to increase them. It motivates the customer in an intangible way, making the buyer want the product, drawing the consumer toward an unplanned purchase. Below is a brief course in “Merchandising 101”.

Merchandising Terminology
National Pattern and Plan-O-Gram The act of arranging like products and brands on specifi c shelves to maximize visual impact. The National Pattern and Plan-o-grams provide an organized and effective way to merchandise and maximize sales. Mall Theory and Destination Merchandising Ensuring that each bag stands straight and slightly overlays the bag next to is as to be display bag graphics and fit the most product in a specific space. Striping, Grouping, and Blocking Designated order in which each product is merchandising; could be specific for a store or chain of stores. If not prescribed, defaults to the standard version used across the country. Rotating, Relocating, and Rolling Act of organizing product with best-selling brand in key locations and placing products together by consumer type and/or consumer occasion. Point of Sale Material Moving products into the location in which they are most likely to sell prior to expiration date.

Basic Steps: Placement is the core of product merchandising; make sure the product is in compliance with the planogram. Check to see that they are in the proper location, or if they could be moved to a better location (always gain approval before adjusting a display). Pack the shelf to capacity, and pull product forward to give the shelves a “full” appearance. Turn the labels out and align them. Shelf tags must be on all traited and active product before

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Culling Knockdowns (KDs) is covered in detail on page 6
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leaving the store (no call is complete without all tags, no display is complete without a price sign), and verify that they have grocery labels. Coordinate this with the department or scan coordinator. When setting new items, check on the shelf or in the back room for product. Identify the new item category, and scan the category for deleted items – this will be the best place to cut-in a new item (a competitor with extra facings is the best scenario for placement – look for SKUs with 3 or more facings). Have a plan in mind before discussing it with the department manager and gain permission to cut in the item. Always make a tag and give the new item an “address” on the shelf.

Section 6: How to Merchandise Frito-Lay Product
Salty Snack Category Facts: Driven by impulse, 82% of all salty snacks are purchased on impulse, so display salty snacks in high traffic areas to capture all shopping occasions and trigger impulse purchases. Consumers are looking for quick, convenient mean solutions, so display salty snacks and dips in the perimeter locations to capture all impulse and quick meal purchase opportunities.

When merchandising Frito-Lay product, first survey the section and gather the product. When packing the product on the shelf, perform the “Three R’s”, Rotation, Relocation, and Rolling. When complete, clean up and gather KDs (Knock Downs, or boxes). Work efficiently, but at a fast pace – you should be able to work a minimum of 30 KDs 4 in one hour. And remember the building blocks to success while working in the store! The Three R’s Rotating, Relocating, and Rolling product ensures the best chance of selling it quickly at the highest quality to the customer. Rotating product places the oldest up front and the freshest in the back. Relocating moves product within an account to faster moving locations. Rolling transfers product to another, faster moving store to avoid stales. The product expiration can be found above the price point on the bag. Use the Three Code Rule: stock no more than two different freshness dates on like product bags, depending on the volume of the account. Old dates must be pulled and left in the back room for RSR, which will determine whether or not to pull the stale returns. Relocating moves product around the store to higher velocity sales areas, which is not always the gondola. Keep an eye out for opportunities, for example, older product can move from the seasonal aisle to the gondola to make room for newer product. Work the Aisle Start at one end of the aisle and work to the opposite end. Stage boxes in front of the section you are working in , and be careful not to drop product - potato chips and tortilla chips are as fragile as eggs, if you drop a case or a bag, they will break. As you complete your work, place the Knock Downs on a cart. Presentation of Product Stripping is a vertical grouping of similar items (primarily Wal Mart standards). Grouping keeps associated product together, like chips and dip. Blocking refers to square or rectangular sections. Popping and Lacing is a display technique for bags of chips which allows you to add more bags to fit on the shelf, maximizing capacity and enhancing the visual attractiveness of a section, all of which increases a chance for purchase. To “Pop” a bag, straighten the top and bottom of the bags, removing creases that may have occurred in packaging, then carefully “pop” the corners, pulling the edges quickly but gently away from each other. Lacing is simply placing bags diagonally on the shelf, facing the aisle traffic, and interlacing with other bags.
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Building Blocks are described on Page 1
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Space to Sales Nationally, Frito-Lay has a 65% dollar share of the salty snack market. Product is allocated to the percent of business, known as “Space to Sales”, so with 65% of the business, Frito-Lay gets 65% of the space, and more space means more sales. On average, Frito-Lay product turns 52 times each year, and in Wal Mart it’s even better, upwards of 72 each week! This is compared to the retail industry average of 6-8. Within the space, traffic patterns determine placement. Lead products, like Doritos, lead off an aisle, and bags are turned toward the traffic flow. Apart from the permanent shelf space, there are types of temporary space as well, including FEMs (front end merchandisers), seasonal, cross docks (Wal Mart), shop arounds (Wal Mart), cross category displays, weekenders, TMDs (temporary modular displays), shippers, store ready display units, and sidekicks. Promotion Promotions are designed to encourage additional or new purchases, and help to protect market space and increase market share by staying competitive. Types of promotions include a temporary reduction in price, print advertising in the mail or newspaper (tabs), and coupons, but some companies, especially Wal Mart, have specific promotion opportunities, such as: COMAC, Wal Mart’s force out display program; Wal Mart TV, VPI (or Volume Producing Item) and Rollbacks. Distribution Items in distribution are known as Traited items, or Authorized items. They are listed on the planogram, and can vary from store to store. They are not always valid – valid items are in store and selling through. A large distribution of items appeals to consumer preferences, seasonal events, special occasions, and economic status. Increased distribution leads to increased sales! Working with KDs Knock Downs are the reusable cardboard boxes that Frito-Lay products are packed in to deliver to the store. Labels on the outside identifies the product inside. KDs are color coded and should be “knocked down” to reuse for future deliveries. KDs are Frito-Lay property, and should NEVER be given away to customers. Losing just 20% of usable KDs in one store can lead to more than $5,000 each year in losses. The only time a carton should not be returned to Frito-Lay is if it is damaged, since damaged cartons can cause product defects and productivity problems for packers. Damaged KDs should be culled and returned to the plant. When returning KDs to Frito-Lay, they must observe the LUSO standard (Labels Up, Stripes Out). This helps the company place cartons directly into production and saves 50% labor. Company-wide, Frito-Lay’s objectives are 98% KD return rate, 100% LUSO, and 100% culled cartons returned to the plant for recycling. You Make the Cull! Look at the carton’s condition, not the labels. Cull any KDs that are torn, knocked out, wet, badly creased, or have crushed corners or grease stains. Mixed Product Mixed product is any product that is not what the label says it is. The description may be partially or completely incorrect. This is a danger due to the possibility of allergens mixed with mislabeled product, such as nuts, soybeans, eggs, wheat, or milk. Consumers who eat foods they are allergic to can experience severe problems, which can even lead to death. If you find mixed product, DO NOT PUT THIS PRODUCT ON THE SHELF! Contact your supervisor immediately!

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Section 7: Category Resets
Each category reset is defined by the Planogram, a “map” of product and where it belongs both in the store, and within its section. Your Frito-Lay planogram is usually located in your sales plan, but could also be in the store on the shelf behind the Doritos. The “map” gives you a lot of the information you need, including the section size and store number at the top, the stockcode or store item number, the number of facings shown or listed, all marked into 4-foot sections. However it can also contain additional information, so be sure to read it over before you begin. Sometimes the planogram and actual store space don’t match exactly, but this will not stop you from performing the reset. Maximize the presentation and capacity as close as possible, and for drastic differences, seek advice from Frito-Lay personnel. Resetting a basic Frito-Lay planogram should take approximately 1 hour per 4-foot section. Most planograms work with linear footage, but verify the footage of the section with store personnel before you begin. Standard shelf height varies, but typically each shelf space is 14” high. If the shelf height is not listed on the planogram, set the shelves to the tallest product. Most planograms are set overall to 73” or 74” high. Reset Steps The precall is the first step in any reset. Contact the store and confirm the visit. Arrive 10 minutes early, and communicate the details with the store manager. Ask for the name of the manager that will be present on the day of the reset. Verify procedures for missing shelf tags or overstocks, locate the cleaning supplies and reset equipment in the back room. When working the reset, tape off the section and retrieve the equipment. Secure shopping carts to hold product. Measure the gondola aisle and match it against the planogram, and then empty the first 3’-4’and load into empty shopping carts. Remove the existing gondola wire and clean the base shelf and gondola back. Measure for shelf heights using the largest bags in the set, then start at the bottom, left and work to the top, right. Place all overstock products in the shopping cart and proceed to the next section. When finished, re-tag the section and move all overstocks to the back room and re-box with labeling for Frito-Lay. Finally, clear the aisle of all carts and reset materials. When you are finished, locate the manager and walkthrough the section, explaining what was accomplished. Walk with the manager to the back room and verify the location of overstocks, and THANK THE MANAGER for his or her support on behalf of Frito-Lay.

Possible Scenarios:
Pole in the middle of the section – Shelves can be cut to accommodate the pole. Archway associates not authorized to physically cut shelves should seek assistance from the store manager. Divided section – Work with the modified planogram or flip the section as needed. Seek assistance from Frito-Lay personnel. Shelves won’t fit – Seek assistance from store personnel on location of other fixtures that could possibly be used instead. Fixture missing – seek assistance from store personnel on location of missing fixture or ask them to order the fixture if necessary. Postpone the reset until the correct equipment is available. No decision maker available – Seek assistance from the manager on duty or department manager for approval.

Take the Exam!
You have completed the Frito-Lay training document. Please refer to the index pages for additional information.

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