Assortment Optimisation
The data-driven process of determining the ideal range and mix of products to stock in a retail location to maximise sales, margin, and shopper satisfaction.
Full Definition
Assortment optimization uses analytics to decide which SKUs to include, retain, or delist from a store's product range, balancing shopper demand signals, margin contribution, shelf space constraints, and supplier terms. Analytical models incorporate sales velocity, substitution rates, customer segmentation data, and market share benchmarks. The process is iterative and typically conducted at category review cycles. Editors should note the UK spelling 'optimization' (with an 's') versus the US spelling 'optimization' (with a 'z')—the appropriate form depends on the document's regional audience. Do not confuse with 'space optimization,' which focuses on shelf allocation rather than product selection.
Usage
Usage note: Use 'optimization' for UK/Australian audiences and 'optimization' for US audiences. Confirm regional house style before editing. Do not use 'assortment optimization' and 'range management' interchangeably—they have distinct analytical scopes.
In Context
- "Assortment optimization analytics identified 38 underperforming SKUs recommended for delisting in the next category review." — Category analytics report
- "The retailer's assortment optimization model weighted local demand data more heavily than national benchmarks for regional stores." — Data science methodology document