Performance improvement program for home & living retailer
Situation:
- Home & living retailer with a vast private label assortment faced decreasing profit due to sales decrease reduction, skyrocketing stock levels and growing merchandise costs
- Objective was to identify and implement measures to improve assortment and financial performance
Actions:
- Reviewed assortment performance, analyzing sales, margin, and inventory metrics
- Benchmarked against competitors, comparing product offerings, pricing strategies, and category management
- Identified gaps in assortment and areas of improvement
- Segmented the assortment into core offerings, seasonal products, and niche items
- Established policies per segment with regards to category depth, product renewal, pricing, promotions, sourcing/supply chain, and inventory management
- Assessed new sales channels, exploring B2B opportunities and feasibility of B2C online marketplaces
- Detailed improvement initiatives and quantified their impact on revenue, margin and inventory
- Created implementation plans including responsibilities and milestones
Results:
- Refined product portfolio and optimized assortment, removing underperforming items and introducing new products
- Tailored supply chain and operations policies, improving demand forecasting and replenishment
- Adjusted marketing approach, focusing on high-potential categories and selective price increases
- Achieved 20% increase in EBIT through assortment restructuring, cost reductions, pricing optimization better net working capital management
- Set up a framework for ongoing monitoring and refinement of assortment strategies based on market feedback and performance metrics
