Finally, a strategic way to cut unnecessary SKUs

Abstract

Purpose

The article offers a radically different and truly strategic approach to SKU optimization.

Design/methodology/approach

The author has put together an innovative approached base on recycling and reapplying tested methodology – such as customer preferences and customer switching behavior – to achieve the removal of unneeded products from the portfolio.

Findings

This new methodology holds the prospect for a portfolio transformation, brand enhancement and significant cost reduction

Practical implications

Designed to eliminate high‐volume but unnecessary SKUs, this approach is based on three principles: Only products that score well with consumers are keepers; and those that don't score highly can be targeted for elimination. Identify which SKUs serve unique channels. Conduct a failed‐product elimination process.

Originality/value

This is the first truly strategic approach to ending SKU proliferation, a cause of substantial wasted resources.

Citation

Byrne, B. (2007), "Finally, a strategic way to cut unnecessary SKUs", Strategy & Leadership, Vol. 35 No. 1, pp. 30-35. https://doi.org/10.1108/10878570710717263