Commodity characteristics include many methods for classifying goods, but one of the most important principles of sorting is the characteristics of the assortment. Basic indexes will help determine the indicative differences between products of various types, names and purpose.
Assortment of goods
The totality of commodity items, united by similar characteristics, can be divided into separate groups according to certain characteristics:
- location of goods;
- breadth of coverage;
- nature of needs.
Consider these classification elements in more detail.
Groups of goods, divided by location, mean the sorting of products by product or industrial characteristics. Product categories include the entire main range of goods that is involved in the turnover of trade points - for 95% of stores, diversity is an absolute advantage. The exception is the network of highly specialized stores focused on the promotion of a brand - for example, the Yves Rocher cosmetics store, the clothes of eminent ateliers, and so on. Industrial classification sorts all products by industry — for example, car dealerships or retail outlets offering food products promote automotive and food products.
The breadth of coverage implies the formation of a simple or complex assortment. Simple represented by a small number of brands and product groups that can satisfy the minimum demands of customers. For example, optics offering glasses and contact lenses of various modifications is a classic example of a simple assortment. Complex is a large list of products, which is represented by many types, groups and names of commodity items that satisfy customer needs. The classic examples of outlets that offer a mixed assortment are supermarkets.
By the nature of the needs, all the products presented can be divided into the actual list available in the specifications of the suppliers, and the predicted one is an ideal assortment that fully satisfies the buyer.
Assortment indicators
In general, the assortment of goods can be called a set of different products, the choice of which is formed according to certain criteria, taking into account and satisfying the needs of each buyer.
The assortment range has various indicators that characterize products according to various parameters:
- Latitude. So you can call the set of types, names, brands of various goods of heterogeneous or homogeneous groups.
- Completeness. The characteristics of the assortment range according to the list of different types of products of the same type.
- Novelty (update). The ability of the presented product range to satisfy changing customer needs through the introduction of new products.
- Sustainability. The ability of the presented product range to satisfy daily demand.
Examples
To conduct a practical analysis of the assortment indicators, consider the assortment list of a small atelier that produces clothes.
Currently, the garments presented by this manufacturer are limited to seven types of women's clothing, and each of these types is presented in four models. From here you can determine the depth of the assortment, which is calculated by the formula:
Number of views × number of models = 7 × 4 = 28.
We determine the coefficient of latitude of the manufacturer. This parameter is defined by two indices:
- W p - real latitude as the actual number of items of goods available.
- W b - the base latitude as a base indicator, taken as the basis. Such an indicator is individual for each enterprise and is calculated based on the production capabilities of the manufacturer.
Current breadth of assortment:
If the enterprise sews twenty women's blouses, and has the ability to sew forty, then this ratio will be equal to:
- K w = 20: 40 × 100 = 50%.
The calculation of assortment indicators will be incomplete without calculating the completeness parameter. This is called the ability of the manufacturer to satisfy the same type of customer needs. Completeness depends on two indicators:
- P p - the actual number of types of goods presented.
- P b - the planned number of types of goods.
For example, the specification provides for 7 varieties of blouses for women, but in fact, 4 were received. The completeness of the assortment is 0.57. The completeness coefficient of goods can be represented in the form of a formula:
This means that the full range will be 57%.
Indicators of the assortment of the enterprise include such a value as sustainability. This value (Est.) Characterizes the ability of the supplier to satisfy the demand for goods available in the specification:
If our manufacturer is able to regularly provide customers with twenty-five blouses per month, then its stability coefficient will be equal to:
Or the property of the assortment “sustainability” will be equal to: 25: 40 × 100 = 62.5%.
Expanding the assortment is impossible without taking into account the novelty parameter of products - this is the name of the supplier’s ability to respond promptly to the demands of the times and satisfy the changing wishes of customers. The novelty of the assortment is characterized by actual updating - the number of new positions in the general specification (N) and the degree of updating (K n ), expressed through the ratio of the number of new products to the total number of items (or actual latitude).
For example, in the above problem about the sewing workshop of twenty-five blouses that go on sale, 7 models are new. The specific weight of new products in the general specification will be:
or in numerical equivalent:
Expansion of the assortment through updating takes place in two stages:
1) the presentation of new nomenclature items;
2) deletion of obsolete goods from the State Register.
Assortment list
The selection of the required product for a given outlet creates an assortment list. This is the name of the minimum quantity of permissible goods that must be presented in a given trading place. The assortment list should be characterized by such parameters as depth, variety of presented trade brands, wide choice.
The classification of the assortment of a trading enterprise is usually represented by products of both an industrial and a trading group. But all this product is necessarily consistent with the assortment list. A minimum set of everyday goods should be available at each outlet. In turn, representatives of retail chains should coordinate it with local authorities.
Important! Ignoring the assortment list can lead to serious administrative fines.
The indicators of the assortment of goods determine the structure of choice. So we can call the numerical proportions of various commodity items in the general product list. The indicators of the assortment and its structure are expressed in monetary or in-kind parameters, calculated as a percentage of individual groups, trademarks, types and proper names to the total weight of the entire product list at the outlet.
Assortment Management
Various actions and activities aimed at establishing, maintaining and ensuring a certain variety of goods on store shelves and other retail outlets are called assortment management. The indicators of the assortment of goods directly depend on the structural transformations associated with the goods turnover and its logistics - from the manufacturer through distributors and the retail network to the end consumer.
The structure of the entire available assortment (C) can be described as the specific share of each type or article of goods in the total mass of goods sold by the outlet. The parameters of the assortment structure have natural and monetary indices and are expressed as a percentage. They can be represented in the form of a fraction, in the numerator of which will be the index of the quantity of individual goods of individual goods (A), and in the denominator - the total number of all goods in the assortment (S):
How to manage the assortment
Assortment management technologies directly depend on general technological progress, on the stage of development of agriculture and industrial production, on the achieved level of scientific progress, which allows consumers to offer various technical innovations, etc., on the welfare index of citizens. The completeness of the assortment presented at the point is achieved using various formulas used in trade to achieve the most acceptable level of stocks of goods and optimal turnover.
Assortment formation
The rational formation of the assortment contributes to the qualitative satisfaction of the needs of the population. Its modernization should overtake demand, thereby taking a direct part in its formation. On the other hand, it is impossible to lag behind the current demand, because in this case the market, through the introduction of new product line items, will be able to directly influence the tastes of customers. A large assortment of obsolete products will be the beginning of a continuous series of losses - the buyer will not purchase obsolete samples of household appliances, and the manufacturer will not take them back. The basis for updating the list of goods offered for sale is moral and physical depreciation.
The foundation for assortment management is the ability of various manufacturers to promptly offer a specific specification. The presented groups of goods must correspond to the direction of the economic activity of the manufacturer and at the same time fully satisfy the needs of certain segments of customers.
The basis for the selection of the product list is the planning of virtually all the main activities aimed at selecting goods for further production and subsequent sales. The other side of the selection of the assortment is the fitting of the characteristics of the various properties of a particular thing, product to the wishes of potential buyers. The selection of goods on the basis of the worked out assortment is a continuous continuous action that continues throughout the life cycle of a commodity unit. A similar process begins from the moment the concept of the existence of a specific type of product is born. The last point will be the leaching of this unit from the shelves of retail chains, the removal of the manufacturer from the product specification.
10 principles of assortment formation system
The principle of creating an assortment list includes the following moments:
1. Determination of current and probable requests, requirements of potential buyers, analysis of the possibilities of using products of this type and principles of consumer choice in relevant markets. For example, in pharmaceuticals, the current seasonal needs (autumn colds or seasonal flu) should be met by an extended pharmacy assortment, which includes a large number of cold medicines.
2. Consideration and analysis of existing product analogues offered by competitors.
3. A critical assessment of the proposed goods in the same assortment as in paragraphs 1 and 2, but from the point of view of the consumer (very little, enough, in excess).
4. The solution of questions about what exactly should be included in the main assortment, and what positions should be excluded from it because of changes in the offers of competing enterprises and the general state of the sales market. For example, rumors about the introduction of an additional tax on the sale of imported medications can significantly narrow down the pharmacy's assortment - in which case it will be more profitable to trade domestic medicines.
5. Analysis of incoming proposals regarding the creation of a new assortment range of products, modernization of the existing product base, as well as analysis of new possibilities for the use of goods.
6. The appearance of updated specifications for improved products or products that first appear on the market, in accordance with existing requirements.
7. Analysis of the profitability of the production of new or improved products.
8. Testing (testing) of new products taking into account the opinions and requests of potential buyers. Such testing is carried out in order to find out how much new products meet the needs of the market.
9. Development of specific instructions and recommendations for the production sectors of the company, including the required parameters of quality, model, cost, name, packaging, pre-sale service, etc. Such recommendations are written based on testing results confirming the acceptable characteristics of the product, and are agreed upon in government services.
10. Analysis of the entire existing assortment.
Assortment management is part of any marketing
Even well-developed sales and advertising plans will not be able to nullify the consequences of omissions and shortcomings that may have been made when developing the assortment list. Assortment management involves the coordinated actions of interconnected segments - design and technical, holistic sales analysis, signing contracts with distributors, the finer points of service, advertising, and stimulating demand.
The difficulty in solving such issues lies in the difficult combination of all of the above positions to achieve the desired results: optimizing the assortment taking into account the capabilities of the business entity and set marketing goals. If this goal is not achieved, the product list will include products developed more for the needs of the company and its divisions than for the potential customer. Basic marketing principles point to this contradiction and give recommendations on the plan of current actions. The main goals of planning and assortment formation are primarily to approve the required "consumer" specification with a list of finished products, send it to the development sector, and then make sure that the prototype is tested and brought up to the level of current customer requests. When forming the list of finished products, the final word should be given to the heads of the marketing department of the enterprise, who will provide explanations as to when it is more expedient to invest in the modernization of the finished product, and not bear the increasing costs of promoting obsolete products or lower their cost. It is the marketing manager who must answer the question of whether it is time to introduce new products to the range instead of existing ones, or is it better to update the old specification with modified products.
Marketing and assortment formation
A wide range of products can be formed by various methods. It mainly depends on:
- sales volumes of products;
- specifics of the goods offered;
- tasks and final goals facing the manufacturer.
All three parameters are united by the fact that assortment management must be subordinate to the head of marketing. Updating or modifying the product allows you to more fully use the "absorbing" opportunities of the markets, taking into account the specifics of their requirements in certain areas, to fill those product niches where there is no competition (or it is not big). But the identification of forthcoming tasks in the assortment strategy is a rather costly affair, the main aspects of which are related to the need for significant updating and expansion of production capacities, the purchase of new equipment, and the deep restructuring of established sales networks for expanding the entire existing marketing mix. The use of uniform rules for the production of products, differentiation of individual groups of goods or their combination depends on the individual conditions of the manufacturer and is determined only after summing up. At the end of a certain period, the results are summarized: how much the level of economic efficiency of sales has changed, whether the volumes of sales that were planned using these methods have increased, or whether the financial result has improved. After that, conclusions are drawn on the profitability of the production of this product and the prospects for its further release are determined.
Effective management
Rational use of the product range allows the company: ·
- reduce the number of sales lost due to lack of necessary goods;
- to accelerate the pace of turnover of goods at the outlet;
- reduce surplus goods;
- reduce the risk of goods being written off due to the expiration date; · minimize the total costs associated with stocks.
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