Range Optimisation & SKU Rationalisation

Working with a premium high street greeting cards and stationery retailer to improve their optimal product range.

To discuss how we can help you with similar challenges, please contact Jeremy Smith.

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The Problem

As a result of frequent range changes and lack of clear exit policy, the retailer had a long tail of items across all product categories.
The 4C team was tasked with removing at least 50% of the range and suggesting an optimal range to drive sales and margin, as well as improve availability of core lines.

We analysed the performance of each SKU within individual categories, stripped the product ranges down and then built them back up using a ‘bottom up’ approach.
Concurrently we benchmarked the incumbent ranges with key competitors and highlighted areas where the business was over or under ranged in terms of product options and brands volume.
Using this insight, a proposal was made for the optimal number of SKUs within each product category to maximise sales and margin.

The in-depth review led to over 8,000 SKUs being flagged for deletion from future ranging, improving future sales and margins without negatively impacting the customer.
Subsequently COGs were reduced as a result of higher volume.
The smaller range led to continuous operational benefits in terms of ordering, stock holding, visual merchandising and ultimately an enhanced shopping experience for customers in-store.