Should You Eliminate A Product Category?

So many stores, so much stuff. In light of our recession, retailers are trying to find ways to survive the reality of their retail sales – or lack of them. Inventory is being analyzed, sales and promotions are running wild and orders are being slashed for new goods. Finding balance in it all can be overwhelming – but important. One thought to consider is if you can simply begin to fade out and then ultimately eliminate one product category in your store.

If you are a shoe store selling handbags and jewelry to help enhance your shoe sales, maybe eliminating handbags is something to consider. This should, of course, be considered only after determining handbag sales are down. The goal should be to eliminate one or maybe a few categories that are not performing as well that in return will allow you to focus all your energy and financial availability towards the categories that are selling better. Dollars will open up and customer focus will be strengthened. In addition, the products that are moving will be highlighted more since there will be less product assortment for customers to consider. Take the opportunity to really analyze your current assortment of inventory and decide what is selling best and what isn’t selling at all. And ask yourself – are customers coming to your store for “this particular item / category” or do you have it in your store to help enhance other products? If customers aren’t coming to your store for it and it isn’t selling, maybe it’s time to reconsider why you have it in your product assortment at all.

Another thought is to eliminate a few brands without taking away total categories. This should be considered if you believe the category you are offering is vital to your overall store success.

Finally, be realistic with yourself. As boutique owners and small business buyers, we often tend to let our personal emotions get in the way of our professional decisions. Try and be netrual here to make the best decision right for your business.


  • Ted Hurlbut
    April 30, 2009

    As sales decline, inventories have to be brought down to keep them in line. That’s going to invariably impact assortments. here’s what I’m recommending to my clients;

    1. Break assortments down into core/destination, complementary/accessory, secondary and impulse items, categories and programs. Each of these groupings needs to be considered separately, in their own way.

    2. Core/destination items, categories and programs drive your traffic, and your business. They contribute the largest percentage to your sales, and turn over the fastest. You carry them in breadth and depth. Still, there could be individual items within these categories and programs that aren’t carrying their weight. These assortments need to be reviewed for anything that’s not doing its job, and either have the depth of stock reduced, or be cut from the assortment completely.

    3. Complementary/accessory items are logical add-on items to any sale of core or destination items, but they are not essential to the purchase. An example in a women’s designer boutique might be a basic pant program in several colors. In a store like this, the core/destination categories are likely to be fashion tops and bottoms. A basic pant program will tend to turn over more slowly, and need to be reviewed carefully. It could be that three styles need to be culled to two, or four colors pared to three.

    4. Secondary items, categories or programs are those things that may have grown out of a carefully constructed test, or expanded from a hot item. Usually, these things take root when business is good and customers are willing to expand their basket. Conversely, when business is not good these items, categories and programs suffer the most, and inventory can quickly back up. When this happens, these items, categories and programs need to be suspended and liquidated immediately.

    5. Maintaining irresistible assortments of impulse items is essential to maintaining dollars-per-transaction during difficult times. These assortments still need to be reviewed, however. Shift to items that have a more related, utilitarian appeal. Price points likely need to be sharper and more attractive. Impulse appeal is still the driver, but the nature of the items changes.

  • Michelle
    May 5, 2009

    All solid points! I found some validation in buying strategies that I am experimenting with currently. I really love this site btw! It’s a great resource!

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