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With the various market trends that solidify over time, experts are faced with the challenge of understanding the current market and establishing an effective development strategy. Assortment management is the way to do this.

To delve a little deeper into the topic, we had a chat with João Carlos Lazzarini, professor of the USP bulk lead MBAs , who began the conversation by presenting different approaches used in assortment management.

“From the manufacturers’ point of view, for example, assortments can be called product mix or portfolio. However, I prefer the definition given by Michael Levy and Barton Weitz. For them, assortment is the number of different items within a given product category, associated with the depth of the product category, that is, the set of SKUs (stock keeping units ) of a product class,” the professor highlights.

About other concepts
Lazzarini also sought to facilitate the conversation about assortment management by presenting some terms also used in the area and according to the authors mentioned:

Variety: number of product categories offered to the consumer. It is also associated with the availability of categories and segments.
Availability: refers to the supply of stocks for consumption made by the retailer. It is normally calculated by the percentage of customers who find stocks at points of sale. A result of 80% indicates that it is acceptable that, for every ten consumers, eight find the desired product in the store, for example.
SKU: is a unique product identification code. It is similar to the product's ID or CPF.
How to achieve effective assortment management
To be used as a marketing strategy, assortment management requires some considerations proposed by the professor. They are:

Market segmentation is expressed in the profiles of consumer groups, which are distinct from each other, with their own preferences and attributes. This segmentation must be identified and the profiles defined.
The target audience, specifically aimed at the segments in which the company is interested in developing and reaching.
The organization's positioning, established through the set of benefits of the company's products and services that, by offering something relevant, add value greater than the proposal.
“Performing excellent assortment management involves the decision-making process to determine which items (SKUs) to add, reduce, maintain or eliminate from the list of a given category. The goal is to satisfy consumer demand, meeting the expectations of retailers and manufacturers,” says Lazzarini.

The two sides of the coin
The professor also presents, in a summarized manner, different approaches from great retail theorists. Check it out below:

More is better: the more options to choose from, the more freedom. This principle relates quality of life to the opportunities and quantities available.
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bulk lead

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