Secrets of successful store assortment management
First of all, it should be noted that the store's assortment is like oxygen for a living organism. Without the product, the business will wither away, while its excess will also be disastrous.
The banal truth? Yes, but unfortunately, many entrepreneurs make a lot of mistakes in the formation of the assortment, which leads to deplorable results of the outlet.
In this article, I want to look at the main mistakes when working with an assortment, ways to avoid them, as well as important components of effective assortment management.
1.Insufficient study of the demand and needs
of your target audience (CA)
Purchasing goods without
conducting market analysis and understanding the preferences of potential buyers is
the most serious mistake. Often, the store owner is guided only by his
taste and idea of fashion. As a result, the store turns from a retail outlet
into an exhibition hall, which flatters the pride of the owner, but does not
generate income.
How to avoid:Conduct regular market research, as well as collect feedback from customers to understand their needs.
2. The absence or incorrect implementation
of assortment planning.
Assortment planning is the cornerstone of the retail
business. If you do not plan in advance, based on the needs of your target audience and planned
sales figures for the season, the breadth and depth of the purchased
assortment, the number of models, articles and size ranges, you may
not have enough goods to meet demand, or you may have a surplus.
Both are bad, because in both cases you will lose in revenue and profit.
How to avoid: Implement regular assortment planning based on statistics and linked to sales plans.
3.Insufficient updating of the assortment
Outdated products and the lack of new products in the store's assortment
are expensive for regular customers and reduce the competitiveness of the store, which means they deprive it of the opportunity to grow in
revenue and profit.
How to avoid: regularly update the product range, follow trends and offers from competitors, and introduce new products to the market.
4.Inefficient inventory and
seasonality management
Clothing trade is a pronounced seasonal business. That is why the effectiveness
of seasonal inventory management is an important component of the success of a retail store. If
you do not take into account seasonal factors in the assortment, do not provide
the store with goods of acute seasonal demand in a timely manner, this mistake will immediately affect the
income of your business.
How to avoid:Keep accurate inventory records, take into account seasonal fluctuations in demand, and order goods in advance.
5. Oversaturated assortment
This error sends us away
towards assortment planning. Often,
in order to reduce the risk of not anticipating demand or out of a desire to reach as
large a customer segment as possible, the store offers a wide range of products. So much
It turns out that neither the buyers, nor the sellers, nor the store owner himself can
figure out what they are selling in the end. Usually in such stores, chaos reigns in
the trading floor, the store does not show a decent level of sales, and
the business owner's money is "chained up" in large inventory balances.
How to avoid:Optimize the product range, get rid of poorly marketed products, and focus on the most sought -after items.
6.Unsatisfactory quality of goods
It happens that in pursuit of
profit, a store buys goods with obviously low quality, but at a very
attractive purchase price. This allows you to make a very high margin and
make an impressive profit. But this is a temporary success and a wrong tactic, which
in the end will negatively affect the store's reputation and lead to the loss
of customers.
How to avoid: Carefully select suppliers, monitor the quality of goods, and provide product guarantees.
So, let's summarize.
In order for a store to be successful (read profitable), regular effective assortment management is necessary, which requires a comprehensive approach that includes: market analysis, assortment planning, product lifecycle management, constant monitoring of inventory and product quality.