Today’s fragmented and intensely competitive market place is the obstacle for retailers and suppliers to do business in a traditional way. Even customers have never been more sophisticated. In this perspective, thousands of idea has already been brought though articles, journals and books and thousands of seminars has been hold to define a new way of managing business. Just as an tremendous heat and pressure create diamond, these uncertainties and competitive challenges has produced a new marketing ideas known as category management that offers an wealth of opportunity for those who can adopt with this systematic approach. In this thesis, some definition and structure-oriented phases as well as the challenging area of category management are mentioned. In the next step, a perfect scenario through different stages starting from zero is brought out to show how retailers and suppliers can overcome the power game and collaborate with each other. Finally I have shown that a trust worthy relationship, coupled with in-store implementation of category management, can create a win-win situation for both retailers and suppliers. / Program: Magisterutbildning i Applied Textile Management