The way a store optimizes its retail experience affects sales and profits. Running operations with the same strategy for, let alone years, just months can hinder store performance. Consumer trends are constantly changing, and retail stores must keep up with them to meet the latest market standards. Effective optimization is crucial for store success.
Several options for boosting profits are available to retailers. There’s email marketing, influencer marketing, print advertising, and more. All of them aim to pique customer interest and raise conversion rates. Another new and upcoming strategy is assortment planning in retail. It is a profit-boosting tactic.
Assortment planning in retail can accelerate returns in no time. We discuss what and why it is pivotal in detail. We then elucidate the five best tips for implementing assortment planning in retail in your store. Let’s get started.
What is assortment planning in retail?
Stores have a wide range of inventory. But not all of them sell at the same frequency. The demand fluctuates due to seasons, trends, and economic conditions. Considering those conditions when selling products has an impact on turning over profits. The best solution for the job is an inventory management software application.
Picking what group of items to sell in a given time period and how to arrange them in the store is known as assortment planning. For example, a clothing store may sell raincoats during the monsoon season and shift to selling tank tops and shorts during summer.
The importance of assortment planning
Assortment planning applies to brick-and-mortar store sales as well as eCommerce store sales. Regardless of what sales channel a shopper purchases products from, they are likely to spend time looking up items that catch their attention. As a result, lucrative products that align with a customer’s interests end up getting sold even though the customer had no intention of buying them in the first place.
Assortment planning leads to higher sales as it promotes impulsive buying decisions from customers.
Tips for assortment planning in retail
- Set priorities
Before you begin assorting your inventory, ask yourself what the end goal of this endeavor is. A clear objective enables you to assort products better, staff your store accordingly, and evaluate progress. Your priorities may pertain to raising engagement rates, conversion rates, or meeting a specific profit margin. - Deploy cross-merchandising
There are many products that customers will want to buy to complement another product. For example, sunscreen and cooling glasses are popular items customers purchase together. Similarly, body wash and loofah are also products shoppers buy together. In the brick-and-mortar store, arrange the complementary products nearby. And in eCommerce, suggest complementary products in the form of recommendations. - Leverage data
Over time your store racks up heaps of data on sales, customer trends, product performance, and more. They provide valuable insights that help make informed business decisions. When it comes to assortment planning, historical data is critical. It helps you learn how to efficiently decide what assortment of products to arrange where and when. - Categorize products
A crucial quality is to categorize products while assorting inventory in your store. Take, for example, an electronics store. And a customer wants to purchase a television. It helps to arrange televisions in your store by various hierarchies. They include television size, screen type, feature-wise, etc. - Launch promotions
Customers rarely miss out on steep discounts and promotions. You can leverage this phenomenon to your benefit by creating a sense of urgency. Announce that the offers are time-limited. And arrange the products in areas of the store having the highest traffic. In eCommerce stores, make them visible easily.
Summing up
Assortment planning is a critical strategy for generating the best profits. Determining what products to sell, when, and where is simple when you have a retail management software application. It produces comprehensive analytics that reveals inventory turnover rate, historical sales data, lead time, and more. We recommend SmartPOS as your retail management software. It is fast, feature-loaded, and has modules to map products in your store. Reach our experts to learn more about SmartPOS.