Principle Property of the principle
Richness and balance of the product range
The total number of product groups, variants of each type of product within such groups, their total number and the level of commonality of items from different product groups according to saudi arabia mobile number their functional purpose and area of application are analyzed.
The essence of this principle lies in the continuity of the process of assortment formation.
It is impossible to create a rich and balanced list once that will be relevant for the entire period of the enterprise’s activity.
Reasonable formation of product range
In accordance with the principle of rationality, a product line should be developed taking into account two groups of factors (objective and subjective) that influence the company's product range.
The first group includes:
address of the retail facility;
seasonal features;
demand structure;
novelty of goods on the market;
financial capabilities of representatives of the target audience of consumers.
Subjective factors:
Features of the company (scale of business, number of employees, their level of qualification, material and technical base).
Positioning of the organization (for example, in the field of retail sales: a small grocery department, a non-chain store, a retail chain, a hypermarket, a supermarket, etc.).
Company specialization (production, retail trade of food or non-food products, etc.)
Objectivity of the strategy for forming the product range
When developing a product line, a company must take into account objective conditions:
Assortment strategy is the most important controllable aspect that influences the level of competitiveness of the organization.
Objective formation of the product range contributes to the effective commercial activity of the company.
The assortment policy is developed taking into account the multivariance. The most important points are: diversification, narrow focus of the product line, differentiation
Changes in product range
The essence of this principle involves the use of three basic models for forming a product range:
Vertical change is the diversification of the product range vertical, the purchases of which were previously carried out from external contractors.
Horizontal change – diversification of the product line horizontally or within the products manufactured. In addition, such adjustments can be made in different areas of previously manufactured products, as well as by entering new market areas without intervening in other markets.
Complex change – development of the product line is carried out together with diversification of the assortment in both directions
The development of decisions on expanding or narrowing the product range is based on one of two strategic principles:
expansion of the product line should be associated with diversification;
The reason for reducing the range of products must be the need or expediency of integration both vertically and horizontally.