What is an Assortment Matrix?

An assortment matrix is a document or digital model that represents the entire range of products sold by a company. It structures the assortment by categories, subcategories, brands, price segments and other parameters. This allows retailers to more effectively manage inventory, plan purchases and adapt the offer to the needs of customers.

Main Components of the Assortment Matrix

The following key elements are taken into account when forming an assortment matrix:

• Product categories - grouping goods by functional purpose (e.g., apparel, footwear, electronics).
• Subcategories - detailing of the category (for example, for clothing: outerwear, pants, shirts).
• Assortment depth - number of items within each subcategory (varieties of models, colors, sizes).
• Assortment width - the number of different product categories.
• Price segments - budget, medium and premium classes.
• Frequency of updating - depends on seasonality, fashion trends, demand.
• Regional peculiarities - are taken into account when building a matrix for different locations.

Groups of the Product Matrix

The assortment matrix is divided into several groups depending on the importance of goods for business:

1. Core Assortment - key items that account for the bulk of sales.
2. Seasonal Assortment (Seasonal Assortment) - assortment that changes depending on the season or holidays.
3. Trial Assortment - New products being tested on a limited audience.
4. Complementary Assortment - Complementary products that complement the main items.
5. Regional Assortment (Local Assortment) - goods specific to a particular region.

Assortment Matrix Construction

1. Target audience and market analysis

Before starting to form the assortment matrix, it is necessary to analyze consumer preferences and competitive environment. This includes:

• Studying customer needs (surveys, analysis of buying behavior, working with CRM data).
• Monitoring of competitive offers.
• Assessing market trends.

2. Determination of product categories and subcategories

After analyzing the demand, the list of product categories to be included in the matrix is determined. For example, for a home appliance store, these could be:

• Large household appliances (refrigerators, washing machines)
• Small household appliances (mixers, kettles, vacuum cleaners)
• Accessories and consumables (filters, brushes, cleaners)

3. Optimizing the width and depth of the assortment.

Here it is important to find a balance between the number of product items and their variability. An overly wide assortment can lead to increased inventory and management difficulties, while an assortment that is too narrow can result in lost customers who don't find the right product.

4. Develop assortment strategies

At this stage, it is determined:

• Which items are anchor items (key products that attract customers)
• Which items belong to the category of complementary products (accessories, related products).
• Which products should be regularly updated depending on seasonality and trends.

5. Control and analysis of the assortment matrix efficiency

After implementation of the assortment matrix it is important to analyze its effectiveness on a regular basis. For this purpose are used:

• ABC-analysis (allocation of the most profitable and demanded goods)
• XYZ-analysis (determining the stability of demand for merchandise)
• Margin analysis
• Evaluation of goods turnover

How to Manage the Retail Matrix?

Effective assortment matrix management requires a systematic approach, including the following stages:

Analyzing the current assortment - identifying high and low turnover goods.

Optimization of the matrix structure - adjusting the number of SKUs in each category.

Monitoring salesand demand - using analytical tools to track dynamics.

Flexible assortment management - making changes depending on trends and seasonality.

Management automation - implementation of specialized solutions to optimize processes.

Product Matrix: Example

Let's consider an example of a product matrix for a chain of grocery stores:

Such a matrix helps to balance the assortment, ensuring a sufficient number ofSKUsin each category and timely updates.

Mistakes When Forming the Assortment Matrix

1. Excessive width of the assortment - too many products complicates management and increases warehouse costs.
2. Lack of demand analysis - inclusion of goods in the matrix without taking into account the real needs of customers.
3. Insufficient attention to margins - presence of a large number of low-margin goods in the assortment.
4. Ignoring seasonality and regional peculiarities - assortment not adapted to the local market may lead to a drop in sales.

Solution for Operational Management of the Assortment Matrix

Modern retailers use automated tools for assortment management. One such solution isDatawiz, an analytics platform that allows you to:

• Conduct comprehensive sales and demand analysis.
• Optimize assortment width and depth.
• Manage data-driven pricing.
• Monitor product turnover and category profitability.
• Automatically generate recommendations for assortment updates.

A properly built assortment matrix is the basis of successful sales in retail. It helps the company not only to meet the needs of customers, but also to optimize inventory, increase profitability and promptly respond to market changes. To maximize efficiency, it is important to take into account demand analysis, competitive environment, product margins and seasonal factors. Assortment management automation can greatly simplify this process and improve the accuracy of decision-making. By following these principles, you can create a truly effective and profitable assortment strategy.