What Is Cross-Merchandising? 7 Reasons To Use It in Your Grocery Store

Did you know that 70% of grocery purchases are unplanned?

A customer walks into your store to grab milk for morning coffee. Thirty minutes later, they check out with ingredients for tonight's dinner, tomorrow's lunch, and snacks for the kids.

Smart cross-merchandising can help you capitalize on impulse buys and boost the average basket size for your store — and it helps remind your customers of products they need, but hadn’t thought of previously.

In this post, we’ll cover the basics of cross-merchandising and merchandise planning, including why it’s a critical strategy for grocery stores and how the right tools make it possible.

What Is Cross-Merchandising?

Cross-merchandising is the strategic placement of complementary products from different categories. This approach to stocking and merchandising is designed to encourage customers to purchase multiple items in a single shopping trip.

When customers see related items grouped, they naturally think about how those products work together, and they’re more likely to buy the whole bunch.

Let’s take a look at some examples of cross-merchandising that might work for grocery stores:

Pasta sauce displayed directly next to boxes of pasta
Avocados, tomatoes, lime, and tortilla chips grouped for an instant guacamole station
Burger buns placed in the meat department during grilling season
Baking ingredients like flour, sugar, vanilla, and chocolate chips bundled together during the holidays
Coffee, creamer, and pastries placed in the same aisle

The key difference between cross-merchandising and traditional merchandising is moving beyond single-category displays to create complete solutions. Traditional merchandising keeps products in their designated departments. Cross-merchandising breaks down those barriers to focus on what customers actually need.

The Role of Your POS System in Cross-Merchandising

The key to successful cross-merchandising is to use real inventory and sales data to decide which products belong together on the shelf. This is where your point of sale (POS) system comes into play.

Modern grocery POS systems track purchase patterns and product relationships, giving you insights that make your cross-merchandising efforts more effective. You want to start with a market basket analysis.

Your POS system identifies which products are frequently bought together, which will reveal natural pairings you hadn’t previously considered. Maybe customers who buy organic chicken also tend to purchase specialty marinades, or shoppers picking up ice cream consistently grab fresh berries, too. This data helps you create displays that actually reflect customer behavior, instead of cross-merchandising based on guesswork.

When choosing a POS system, look for these features:

Mix and match pricing
Bundle pricing options
Inventory tracking across categories
Sales reporting by product combinations

Historical data also reveals seasonal insights, helping you predict which cross-merchandising opportunities will work best throughout the year. Your POS system tracks these patterns automatically, so you can plan your Father's Day grilling displays or back-to-school lunch solutions well in advance.

7 Compelling Reasons To Use Cross-Merchandising in Your Grocery Store

Now, let’s dig more into why you should be taking advantage of cross-merchandising.

Reason 1: Increase Average Basket Size and Revenue

The number one reason to use cross-merchandising in your store is to boost sales. Effective cross-merchandising can increase your average basket size by about 20%.

This boost comes from the impulse purchases that cross-merchandising naturally encourages. It’s not about tricking your customers — you’re answering a problem they didn’t realize they had.

Here are a few ways to use cross-merchandising to boost revenue:

Bundle pricing discounts: Your POS system makes multiple-item purchases more attractive by offering slight discounts when customers buy complementary products together.
Department crossover sales: A "Taco Tuesday" display drives sales across meat, produce, and pantry departments.
Mix and match opportunities: Flexible pricing encourages customers to experiment with new products, if they already buy the complementary product.

An advanced point of sale system handles all the pricing complexities of these strategies on the back end, making it easy for you and your staff to make effective bundles without the stress.

Reason 2: Improve Customer Experience

Modern shoppers rank one thing above almost everything else: convenience. Cross-merchandising makes shopping more convenient for your customers because, instead of wandering through your entire store trying to remember what they need for dinner, they can find everything in one curated display.

Related Read: 4 Retail Tips To Keep Customers Happy

This approach also helps solve the problem of decision fatigue for your most overwhelmed shoppers. A "Date Night" section featuring wine, artisanal cheese, fresh bread, and premium chocolate gives couples everything they need for an evening in, without the stress of planning.

Convenience like this drives customer loyalty. People who save time and effort at your store are more likely to choose you over competitors.

Reason 3: Move Slow-Selling Inventory

Every store has products that sit on the shelves, wasting capital and taking up valuable space. In a grocery store, this problem compounds because you’re not just dealing with dead stock — you’re facing spoilage and complete waste if you don’t manage to sell your products in time.

Cross-merchandising gives you a strategic way to move this slow-selling inventory by pairing it with popular products that customers are already buying.

Here are some smart strategies for moving slow inventory:

Strategic pairing: Place a poorly selling specialty mustard next to bestselling bratwurst.
Seasonal clearance: Give leftover holiday spices new life by pairing them with popular year-round baking ingredients.
Bundle pricing: Offer attractive discounts on bundles of all slow-moving items to move multiple troublemaker products at once.

Your POS sales reports identify exactly which products need a boost, so you can identify the products you need to find creative pairings for. You can also study the combinations over time and replicate successful strategies and avoid the ones that still don’t sell, even in a bundle.

Reason 4: Introduce Customers to New Products and Brands

Cross-merchandising works incredibly well for product discovery. When customers are focused on finding familiar items, they often miss new products entirely. By strategically placing new items next to products customers love, you allow them to find a new favorite.

This works especially well for brand expansion. Place that new pasta sauce next to the regular pasta that customers buy every week. They might not have noticed the premium option on its own, but when it's positioned as an upgrade to their usual purchase, they're much more likely to try it.

Mix and match pricing opportunities are another great way to promote new products. When customers can try that new organic marinara sauce as part of a discounted pasta dinner bundle, they're more willing to step outside their usual shopping patterns and discover something new.

Your POS system can track the success of new product introductions. You can see exactly how well new items perform when cross-merchandised versus when they're traditionally merchandised.

Reason 5: Maximize Your Grocery Store Layout

Every square foot of your grocery store needs to earn its keep if you want to run a profitable store — but some locations are more valuable than others. High-traffic areas like endcaps, checkout counters, and main aisles are prime real estate that should work overtime for your bottom line.

Here are some ways to maximize your grocery store layout:

Multi-department displays: Set up a holiday baking endcap that combines flour and sugar from grocery, fresh eggs from dairy, and seasonal spices.
Seasonal rotation: Keep your store fresh with rotating themes that highlight different product combinations throughout the year.
Traffic flow optimization: Use popular products to drive customers to slower sections and far corners of your store.

Cross-merchandising makes your entire store more efficient. Instead of each department operating in isolation, complementary items justify more shelf space for higher-margin products.

Reason 6: Boost Profit Margins

We’ve discussed how cross-merchandising can boost revenue, but you can also use this strategy to increase your grocery store profit margins store-wide. By pairing popular items with higher-margin alternatives, you can improve your overall profitability while giving customers a great shopping experience.

Customers perceive bundled products as better value, even when individual margins are higher than they'd typically accept. Consider pairing conventional favorites with higher-margin alternatives in one bundle, or offering tiered discounts — like 5% off for three items or 10% off for five items — to encourage larger purchases while maintaining healthy individual margins.

Once again, your POS system is the star of the show. To manage these strategies successfully, you need a solution capable of complex bundle pricing and promotion tracking.

Reason 7: Keep Up With Expectations

Today’s consumers have changed their approach to grocery shopping. Convenience is king, and with online meal kits like Hello Fresh and Every Plate available, customers are looking less for individual ingredients and more for complete meal solutions.

Cross-merchandising addresses these modern shopping expectations head-on.

When you create ready-to-cook meal displays assembled from products throughout your store, you offer the convenience of meal kits with the freshness and variety only a physical grocery store can provide. Customers can see, touch, and choose exactly the quality they want, with the convenience they expect.

Best Practices for Implementing Cross-Merchandising

Now that you know the benefits of cross-merchandising, let’s discuss the best ways to implement this approach in your grocery store.

Success with cross-merchandising starts with smart planning. Your POS analytics are your roadmap. This sales data shows you which products customers already buy together, giving you natural starting points for displays.

The key to getting started is to remember to make the connections logical — customers should instantly understand why products are grouped. Pasta and marinara sauce make perfect sense. Random pairings like shampoo next to bananas will only confuse shoppers, even if the data shows you customers often buy both.

Your team needs to understand the strategy behind each display. Train staff on why products are placed together so they can answer customer questions and make helpful suggestions.

Here are your essential steps for success:

Configure bundle pricing correctly in your POS system before launching displays.
Set up mix and match promotions with clear parameters and end dates.
Train staff thoroughly on how promotional pricing works at checkout.
Monitor performance consistently through your reporting dashboard.

Finally, remember that cross-merchandising is an ongoing process. Use your sales data to refine what works and eliminate what doesn't.

Measuring Cross Merchandising Success With Your POS System

Your POS system doesn't just help you launch your cross-merchandising efforts — it shows you whether they're working. Use the built-in analytics in your POS solution to track your efforts and make better pairings over time.

Your POS system tracks these key metrics:

Basket size increases: Monitor average transaction values before and after implementing cross-merchandising displays.
Product attachment rates: See how often customers buy complementary items when they're displayed together versus separately.
Category performance: Track sales lift across different departments when products are cross-merchandised.
Customer frequency: Measure whether convenience-focused displays encourage more frequent visits.

Maybe your "Pasta Night" display performs better on weekends, or organic bundles sell best during weekday evenings. Using real-time data lets you refine timing, placement, and product combinations for maximum impact.

What Is Cross-Merchandising? Get the Most From Your Promotions

So, back to the question: What is cross-merchandising? It’s a must-have strategy for grocery stores that want to stay competitive and maximize their profits and revenue.

When you combine strategic thinking with the right POS technology, you go from random product placement to strategy-driven merchandising without breaking a sweat.

The best part is that you don't have to start from scratch. Your existing POS data has the insights you need to identify your first cross-merchandising opportunities. Look for products that are frequently purchased together, analyze seasonal patterns, and start with simple displays that solve real customer problems.

Ready to turn your grocery store into a cross-merchandising powerhouse? The right POS system makes all the difference.

Schedule a demo with POS Nation today to discover how our grocery-focused point of sale solution gives you the data, pricing flexibility, and reporting tools you need to succeed with cross-merchandising.