The Real Cost of Assortment Planning Mistakes

Published on: 24 October 2018 Last Updated on: 22 February 2020

In the world of e-commerce, there are many practices, concepts, and techniques that can help you boost your revenue and enjoy some extra profits. One of the least mentioned category of mistakes in this manner – and yet one of the most important – focus on the mistakes related to the assortment.

In other words, these mistakes include all the wrong moves that e-commerce store owners are making during the buying process. The real trouble of these mistakes is the fact that many are unaware of their real cost.

This is why we have decided to guide our readers in on the dangers of improper assortment planning – and how it can be fixed. The key, as you will notice in the sections below, is to optimize the process of buying inventory and therefore match the customer demand in a perfectly precise way.

Mistake #1: Using Excel to Track Your Buying Process:

One of the biggest mistakes that e-commerce owners make is the use of Microsoft Excel as a way to track their buying. Even though this seems as a logical way to organize your buying process, spreadsheets are generally a bad way to organize your information.

Speaking of, anything that contains information in categories (added manually) has to be automated. In times when e-commerce owners are experiencing a magnitude of orders online, adding buys manually is time consuming – which is why it needs to be automated.

Mistake #2: Improper Arrangement of Clusters:

Clusters are the next mistake we are focusing on, and one that is tremendously big nowadays. The main way in which e-commerce managers are making it is by assigning every store to a single cluster – which needs to be reorganized.

More importantly, products need to be clustered at a product class level, and use the information in quantities (before the assortments are bought). By doing this, you can link the buying process to the actual allocation and eliminate problems before it’s too late.

Mistake #3: Inter-Store Inventory Balancing:

If you ever caught yourself in a situation where you are losing sales in on store due to your lack of stock for a particular item, you are probably having the same product sitting and collecting dust on the shelves of another store (if you manage more than one store).

At this point, the best way to solve this problem is by a simple trick – which does not involve the purchase of new inventory or the elimination of the inventory in one store so that it can be moved to another.

Alternatively, you should use a smart predictive analysis engine and a tool that is known as “Inter-Store Inventory Balancing” to analyze every single influencing factor of your retail supply chain. As an advanced form of analytics, a tool like this will recommend the optimal inter-store transfer schedule so that you move merchandise from one store to another (from low to high demand).

Mistake #4: Going Big (Instead of Going Custom):

A lot of multi-channel retailers are nowadays focused on the “best rated” programs and solutions for optimizing their assortment planning. And while in most of the cases programs like these are built to last and cover as many aspects of product assortment as possible, they usually lack the functions that are needed in specific situations.

For example, these programs often fail to calculate hundreds of algorithms on the kind of Big Data that today’s omni-channel retail products are able to churn out on a daily basis. Therefore, the general conclusion that we can all take from this mistake is to properly analyze your needs and implement a solution to analytics that works for you as you scale your business, is end-to-end integrated and coordinated between your merchandising and marketing.

Final Words:

At the end of the day, we all must accept the fact that mistakes linked to product assortment happen all of the time – and there is no harm in admitting that.

As a retail expert, however, you should always be able to know how to fix them. Your assortment needs to be consistent, scalable, matching your needs and optimized for your specific customers.

This is what proper assortment planning is all about. Ultimately, it is what will help you determine how much of your merchandise should be placed on your shelf. The end result of proper planning goes a long way – mostly resulting in increased sales and improved customer satisfaction.

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Ariana Smith

I enjoy writing and I write quality guest posts on topics of my interest and passion. I have been doing this since my college days. My special interests are in health, fitness, food and following the latest trends in these areas. I am an editor at Content Rally.

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The Definitive Guide to Market Your Business on Facebook

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We hope you had a great time going through our article and will surely implement these strategies in order to gain maximum profit from your organization. Read Also : 5 Steps On How To Market Your Business Using Social Media Why Every Business Needs Digital Marketing 7 Proven Marketing Tactics To Increase Your ROI In 2018 How To Remove Pname Com Facebook Orca

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However, this is the era of smartphones that have spectacular cameras and video streaming services that show you videos in just a few taps. This means that now the benefits of video content marketing can go beyond its cost. Every business needs to use video for product launches, Vlogs, tutorials, and tips because they provide value to the viewers. Videos allow a business to use humor, appeal to emotion and aid apprehension for relating to your customers in a better way. The same cannot be achieved with a written blog. Tactic 7: Custom Landing Pages Simply put, landing pages are webpages describing a piece of content, which require users to enter their information to unlock the said content. It is regarded as a lead capture tool because you want to be able to convert the readers into leads and customers when they go over your content. Otherwise, it is only a waste of time and resources. Landing pages linked from an email or blog should be connected to digital marketing content. 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The retail industry is quite expansive and evolving with time. The sector plays a key role in the global economy. Within this landscape, certain companies stand out as retail titans, wielding significant influence and dominating market shares. In this article, we will delve into the strategies and successes of the ten biggest retail giants, exploring their backgrounds, market presence, and the impact they have on the industry. Overview Of The Retail Industry Before delving into the details of each retail giant, it's essential to offer a broad understanding of the retail industry. Retail comprises a diverse array of businesses engaged in selling goods and services directly to consumers. This dynamic sector is marked by continuous innovation, evolving consumer preferences, and intense competition. Importance of Retail Titans The significance of retail titans cannot be overstated. These companies not only drive economic growth but also shape consumer behavior, set industry standards, and influence market trends. Their success is often indicative of their ability to adapt to changing landscapes, innovate, and connect with consumers on a massive scale. Walmart Walmart stands as a retail behemoth that has had a profound impact on the industry. Founded in 1962, the company has grown into the largest retailer globally, operating a vast network of stores and leveraging its market presence for strategic advantages. Company Background Walmart's origins as a small discount store in Arkansas contrast sharply with its current status as a global retail giant. With a relentless focus on providing low prices and unmatched convenience, Walmart has become a household name synonymous with affordable shopping. Market Presence And Dominance Walmart's dominance is reflected in its extensive network of stores, both physical and online. With a strong presence in the United States and a growing international footprint, Walmart's revenue and market cap are indicative of its unrivaled scale. Key Strategies for Success Walmart's success can be attributed to several key strategies, including a commitment to low prices, efficient supply chain management, and investments in e-commerce. The company's 1-Year Trailing Total Return on the stock exchange further underscores its financial strength. Amazon: The Greatest Retail Titan In the era of e-commerce, Amazon has emerged as a game-changer, revolutionizing the retail landscape and redefining customer expectations. E-commerce Revolution Amazon's rise to prominence is closely tied to its pioneering efforts in e-commerce. The company's user-friendly platform, extensive product selection, and efficient delivery systems have reshaped the way people shop. Diversification And Innovation Beyond e-commerce, Amazon has diversified its business portfolio, venturing into areas such as cloud computing, streaming services, and artificial intelligence. This diversification has contributed to the company's resilience and sustained growth. Impact On Traditional Retail Amazon's impact on traditional retail cannot be ignored. The company's disruptive influence has forced brick-and-mortar retailers to adapt or face obsolescence, highlighting the transformative power of digital commerce. Alibaba Group: One Of The Greatest Retail Titan In Asia While Amazon dominates the Western e-commerce landscape, Alibaba Group holds a comparable position in the East, driving the Chinese retail revolution and expanding its influence globally. Rise Of Chinese Retail Alibaba's roots in China have allowed it to tap into the immense consumer market, contributing significantly to the rise of Chinese retail on the global stage. Global Expansion Alibaba's ambitious global expansion efforts have positioned the company as a major player beyond Chinese borders. Through strategic partnerships and investments, Alibaba continues to extend its reach and influence. Technology And Ecosystem At the core of Alibaba's success is its technological prowess and the creation of a vast ecosystem. From e-commerce to digital payments and cloud services, Alibaba's integrated approach sets it apart in the retail landscape. Costco Costco's membership-based model and commitment to customer loyalty have propelled it to prominence in the retail industry. Membership-Based Model Costco's unique membership model encourages customer loyalty by offering exclusive deals and discounts to its members. This approach has proven effective in driving repeat business and fostering a dedicated customer base. Focus On Customer Loyalty Beyond membership benefits, Costco's focus on providing quality products at competitive prices has fostered a reputation for value, further solidifying customer loyalty. Sustainability Initiatives In recent years, Costco has also made strides in sustainability, aligning with consumer preferences for environmentally conscious practices. These initiatives contribute to the company's positive public image. The Home Depot As a leader in the home improvement sector, The Home Depot's dominance extends beyond its vast retail footprint. Home Improvement Dominance The Home Depot's specialization in home improvement products and services has positioned it as the go-to destination for homeowners and contractors alike. Supply Chain And Logistics Efficient supply chain management and logistics are integral to The Home Depot's success. The company's ability to stock a vast array of products and deliver them promptly contributes to customer satisfaction. Digital Transformation Embracing digital transformation, The Home Depot has invested in online platforms and digital tools, enhancing the customer experience and staying competitive in the evolving retail landscape. CVS Health CVS Health's focus on health and wellness distinguishes it in the retail landscape, with a strong emphasis on pharmacy services and adaptation to market trends. Health and Wellness Retail As the retail landscape evolves, CVS Health's commitment to health and wellness provides a unique positioning in the market. The integration of healthcare services into its retail offerings sets CVS Health apart. Pharmacy Services With a vast network of pharmacies, CVS Health plays a critical role in providing essential healthcare services. The company's emphasis on pharmacy services contributes significantly to its revenue stream. Adaptation to Market Trends CVS Health has demonstrated agility in adapting to market trends, incorporating digital solutions, and expanding its services to meet the changing needs of consumers. Loves Love's Travel Stops and Country Stores, with a focus on truck stops and convenience services, exemplifies innovation in services and a commitment to meeting the needs of travelers. Truck Stop and Convenience Love's stands as a vital service provider for truckers and travelers, offering a range of amenities, including fuel, convenience stores, and restaurant services, making it a one-stop destination. Travel Center Services Beyond traditional offerings, Love's Travel Stops provides essential services such as tire care and vehicle maintenance, catering to the specific needs of the transportation industry. Innovation in Services Love's commitment to innovation is showcased through its services, including a loyalty program and technology integration, enhancing the overall experience for its customers. Target Target's strategic brand reinvention and commitment to omnichannel retailing have fueled its success in the competitive retail landscape. Brand Reinvention Target's deliberate efforts in brand reinvention, including collaborations with popular designers and a focus on stylish yet affordable products, have resonated with a broad consumer base. Omnichannel Retailing In the era of digital retail, Target has embraced omnichannel strategies, seamlessly integrating online and offline shopping experiences to cater to the diverse preferences of modern consumers. Community Engagement Target's community engagement initiatives, including corporate social responsibility programs, contribute to its positive image and connect with consumers on a deeper level. Caseys In the realm of convenience stores, Casey stands out for its regional strength, expansion efforts, and community engagement. Convenience Store Dominance Casey's focus on convenience has allowed it to establish dominance in the sector. The company's strategically located stores cater to the needs of consumers seeking quick and accessible solutions. Regional Strength and Expansion While Caseys has a strong regional presence, the company's expansion efforts showcase its ambition to reach new markets and further solidify its position in the convenience store landscape. Community Engagement Casey's commitment to community engagement is evident through various initiatives, fostering a sense of connection with local communities and contributing to the company's positive image. Before we wrap up, for further exploration into the corporate landscapes of these influential companies and detailed insights into the top retail industries. Conclusion In the current landscape of the retail industry, these ten retail titans continue to shape the way consumers shop, and businesses operate. Their diverse strategies, ranging from e-commerce dominance to community engagement, reflect the evolving nature of retail. As we look to the future, these companies will face new trends and challenges, such as technological advancements, changing consumer behaviors, and global economic shifts. The resilience and adaptability demonstrated by these retail giants will undoubtedly play a crucial role in navigating the ever-changing retail landscape.

The Real Cost of Assortment Planning Mistakes

Mistake #1: Using Excel to Track Your Buying Process:

Mistake #2: Improper Arrangement of Clusters:

Mistake #3: Inter-Store Inventory Balancing:

Mistake #4: Going Big (Instead of Going Custom):

Final Words:

Your Review of Amazon’s FBA Wholesale Marketing Course

How to Read a Candlestick Chart

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Ariana Smith

I enjoy writing and I write quality guest posts on topics of my interest and passion. I have been doing this since my college days. My special interests are in health, fitness, food and following the latest trends in these areas. I am an editor at Content Rally.

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The Real Cost of Assortment Planning Mistakes

Mistake #1: Using Excel to Track Your Buying Process:

Mistake #2: Improper Arrangement of Clusters:

Mistake #3: Inter-Store Inventory Balancing:

Mistake #4: Going Big (Instead of Going Custom):

Final Words:

Share this Article

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Tags

I enjoy writing and I write quality guest posts on topics of my interest and passion. I have been doing this since my college days. My special interests are in health, fitness, food and following the latest trends in these areas. I am an editor at Content Rally.

Leave a Reply Cancel reply

Popular

Follow Us

Recent

Related