Business Intelligence and FMCG Glossary: #assortment
What is assortment?
The assortment is the set of references of a category, family, or segment, chosen by a distributor to constitute an attractive offer for the shopper in its stores.
Defining the right assortment for a channel is one of the basic elements of the distributor’s strategy. The goal of an efficient assortment is to combine the positioning of the chain with sustainable and profitable growth that meets the shopper’s needs.
An assortment can be:
- Wide/short: depending on the proposal of brands and families
- More or less deep: depending on the variety, or not, of sizes and subfamilies
Or a combination of both in function of the shelf space available, the size of the store or the type of “shopping trip” typical for the channel.
It is clear that the fixed costs (space, inventory management) associated with an assortment featuring many SKUs are higher. Therefore, it is normal for discount chains to opt for a limited assortment while premium ones offer more variety.
The impact of an efficient assortment is also closely linked to the quality of the shelf layout as a result of merchandising studies.
The challenge of defining the assortment is to combine the objectives of positioning and profitability of the distributor with those of the brands offered by the manufacturers. This is called “negotiation.”