The most common way to screw up a product assortment isn't buying the wrong thing: it's buying too many different ones. A small store with a thousand items has full shelves and an empty cash register, because the capital is spread across items that only turn over once a month. We manage 14 stores, including direct, corner, and franchise locations, and this is the lesson that has cost us the most: fewer references, more depthWhat follows is the method we use on our shelves, not a theory.
Count the linear meters of shelving you have, not the ideas you have. Each shelf has a finite number of visible sides, and a side with only one piece doesn't sell: it looks like leftovers. The rule of thumb we use is that each item on display must have at least three visible pieces, otherwise it should be removed and replaced. Once you've done that, you know how many items you can really afford, and it's almost always a lower number than you had in mind. From there, you make your choices: first the categories that bring in people, then those that raise the bill, and finally the items that create ambiance in the display but sell poorly.
Each product in the store does one of three jobs. There is the recall: low price, recognizable, it is at the entrance and serves to get people to come in and touch it. There is the I earn: good margin, zero explanation, it's at eye level. And there's the completion: the item added to the cash register once the decision has already been made. A healthy assortment contains all three; those that do poorly usually have only recalls, meaning high turnover and little margin, or only profit-making items that no one comes in looking for.
In our tour, the year is divided into short seasons: back to school, Christmas, Valentine's Day and holidays, spring, summer and the beach, Halloween. Each season deserves its own set-up. Before That serves its purpose and is dismantled before it's finished: unsold seasonal merchandise isn't unsold, it's capital tied up for twelve months. The calendar matters more than taste: a Christmas display window assembled at the end of October works three times as hard as one assembled in December.
After three weeks, the store has already told you what it wants. The sold item is reordered, the unsold item is moved once to a better location, and if it stays unsold, it's discounted and closed. With a minimum order of €150 + VAT and shipping within 48/72 hours, reordering twice a month costs less than making a mistake on a large order at the beginning. This is why it's best to start small: the first purchase list is a guess, the second is a given.
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It depends on the shelf space, not the type of store. Count the number of visible sides you can fill with at least three items each: that's your number. It's better to have 80 full SKUs than 200 with one item each.
Few, but complete. A customer remembers a store for what they consistently find there, not for what they found there once. Opening a new category makes sense when your existing ones are already full and in circulation.
If it hasn't moved in three weeks, and you've already moved it once to a transit point, it's not the location: it's the product. Discount it and free up the space, which is worth more than the margin you were hoping for.
