[Original Spirit Beast Mountain Tian Kun].
How to optimize the product structure to improve store sales? Whether the product structure can be optimized and reasonable depends on the number of product SKUs, the width and depth of the product portfolio, the measurement of the optimization effect, and the evaluation of itself and its opponents. The first two focus on technique, while the last two focus on optimizing scale.
Merchandising. 
The first is to optimize the number of SKUs. The factors that affect the number of SKUs are mainly the size of the category sales volume, the category combination factor and the category role. If the sales volume is large enough, the number of SKUs will also increase relatively, which is very obvious in the whole category format. There are many category combination factors, such as brand, function, specification, geographic tag, type and age group, etc., indicating that the market segment is obvious, which will affect the number of SKUs.
In addition, category roles also affect the number of SKUs. For example, the target category, which locks in the needs of specific groups of people and is a category that can create profits, so its product mix must be the best solution, with the best width and depth, such as the number of private brands. The daily category meets daily needs, accounting for at least more than 50%, and the number of SKUs is the largest. The convenience and seasonal categories have one purchase randomness and the other timeliness, their number of SKUs is small, and the category mix is wide and shallow. The number of SKUs is also related to positioning and business districts.
The second is the width and depth of the product portfolio. According to the different types of business, it can be divided into four types: wide and deep, wide and shallow, narrow and deep, and narrow and shallow. Wide and deep means that the goods under the category are very complete, wide and shallow means that the product groups are complete but all shallow, narrow and deep is that the product groups under the category are few but the number of SKUs is large, and narrow and shallow is that the product groups and SKUs are very few. Due to the unreasonable combination of width and width, there will be a situation where the product is incomplete or the customer cannot buy what he needs, which is caused by the lack of category, brand, product group or specification packaging.
Essentially, category width is more important than depth, and width is the order of magnitude of the category covered. Since they are not in the same category, widths have complementary advantages, such as laundry detergents and fabric softeners. Depth is the same type of commodity category, and there is substitution between commodities, such as JDB and Wang Laoji. Complementary properties boost sales, while alternative properties give customers more choices, but they also miss out on sales.
It can be summed up in one sentence: complementarity is a sufficient and necessary condition, and substitution is not a sufficient necessary condition. In addition, offline retail will do product replacement analysis through sales ranking, which is limited by shelf space, and both width and depth must delete long-tail demand products, which can be met through online mode.
The third is the measurement of the effectiveness of optimization. For example, supermarkets and convenience stores sell toothpaste, but one of them is wide and dark, the other is narrow and shallow, supermarkets have a lot of toothpaste SKUs, and convenience stores only have a few brands and a few single products. However, when optimizing the product structure, the brand ABCD hierarchical principle will be followed, A is the leader type, B is the follower type, C is the functional type, and D is the children's type. Supermarkets will operate all A-class brands, which is more wide, specifications and features, and this is depth. Convenience stores, on the other hand, will only choose one or two A-class brands, and there are very few SKUs. Class C and D are the same logic, and both follow the 80 20 rule.
Another aspect of optimization is cost. Business analysis is about parity (non-ping efficiency), which is the sales created per square meter, in fact, the profit should also be parity, which shows that any space such as shelves, floor piles and passages has a cost, and each category and commodity group should create value. Therefore, the optimization of commodity structure must be compared and analyzed, mainly focusing on commodity sales, gross profit and revenue to analyze the increase, decrease and improvement. However, the comparison results are not entirely based on data changes, but also take into account comprehensive factors, such as a decrease in non-operating income, but a decrease in total costs, and an increase in sales and comprehensive indicators.
The fourth and final point is the assessment of oneself and one's opponent. The fourth point is more specific, self-evaluation refers to the comparison between different stores within the chain brand, such as business district comparison, product portfolio comparison, pricing strategy comparison, commodity display and commodity ** comparison, in short, analyze the similarities and differences and advantages and disadvantages, in order to improve their own business conditions. This doesn't help much for individual stores, and non-chain stores are mainly doing competitor evaluation.
At the commodity level, the analysis of competition is mainly category analysis, single product analysis, band analysis and display analysis. Single product analysis is the basis of everything, by summarizing all the competing single products, you can analyze the characteristics of the business district, customer group attributes, lack of brands, categories and items and the number of meters displayed. The analysis of the business circle can qualitatively determine the level of the opponent, the analysis of the customer group can determine the differentiation strategy, the analysis of the brand category and the number of SKUs, the single product can be streamlined and supplemented, the analysis of the first belt, the width can be narrowed, and the first level can cover each customer group.
For example, after comparing the supermarket with the competition, it was found that there were too many primary fresh products in the fruit and vegetable part, and too few fresh foods around ready-to-cook and table, so it was decided to increase the convenience of fresh food, such as semi-finished products and packaged fruits. For example, it was found that the convenience category of the brewing part was insufficient, and it was decided to increase tea bags and instant coffee, and there were too many health care products on the shelves, and it was decided to reduce traditional health care products and increase vitamin functional health care products to meet the needs of customers with sub-health needs. In the specific implementation, the data will be summarized, and the plan will be formulated through specific analysis.
In short, the origin of product structure optimization comes from customer demand, competitors and market conditions. Structural optimization is the fundamental aspect of category management, and its origin is customer insight, which starts from customers. Whether the structure is reasonable or not, it is necessary to understand not only the factors that determine the number of SKUs, but also the logic of the width and depth of the product portfolio, and how to measure the optimization effect, and the benchmark is the competitor. Finally, structural optimization is the fourth and last step in the optimization and sorting of commodity structure, and the first three steps are the foundation for the last step.