A SKU rationalization approach was taken that focused on customers rather than individual products. This reduced the business's complexity from over 5,000 SKUs to approximately 3,500 SKUs while maintaining revenues, profitability, and customer satisfaction. By analyzing which style groups and colors contributed most to sales each year, approximately 30% of the SKUs accounting for a small portion of revenues were removed. This led to significant cost savings with minimal impact on customers or financial performance.
1. SKU Rationalization
Reduce business complexity with minimal impact to
Revenues, Profitability and Customer Satisfaction
A non-traditional approach to SKU rationalization was complexity, while maintaining Customer Satisfaction.
undertaken. Rather than a Product-centric view and Approximately 30% of SKUs were rationalized with
seeing which SKU’s were contributing marginally to minimal impact to revenues, profitability & Customer
overall revenues and profits, a Customer-centric view retention.
was implemented. This framework reduced business
Client : A leading B2B Retailer of Personalized Gift Products
• Business had over 5000 SKU’s
across a few unique Product
Platforms. Each platform had
SKU’s across many style groups
and colors.
• Style groups and colors were
investigated for marginal
contributions to Revenues.
• It was found that only a few
key style groups and colors
accounted for over 90% of
revenues
• Further, it was found that key style groups and colors remained consistent year-on-year
• And that Customer repurchases on deleted style groups and colors were not significantly impacted the
following year
• Recommendations made to rationalize marginal style groups and colors, leading to approximately 30% SKU
reduction and significant cost savings in business complexity and working capital.
100%
Reactivation Continued SKUs Reactivation Discontinued SKUs
30% 30% 31% 30% Blue Customer 49%
80% Segment1 44%
60%
Customer 57%
26% 25% 26% 28% Gunmetal Segment2 64%
40% 10% 11% Customer 36%
11%
12% Red
Segment3 34%
11% 11% 11% 10% Black
20%
11% 10% 8% 6% Burgundy Customer 15%
5% 5% 5% Green Segment4 13%
5%
Rest
0%
2008-09 2009-10 2010-11 2011-12 0% 10% 20% 30% 40% 50% 60% 70%
2. Y O U R PA R T N E R F O R
D ATA A N A LY T I C S S E R V I C E S
ADVANCED ANALYTICAL SOLUTIONS
Industry Business Focus Tools and Techniques
Consumer Finance Investment Optimization SAS, SPSS, R, VBA
Credit Cards Revenue Maximization Cluster analysis
Loans and Mortgages Cost and Process Efficiencies Factor analysis
Retail Banking & Insurance Forecasting Conjoint analysis
Wealth Management Predictive Modeling Perceptual maps
Consumer Goods and Retail Risk Management Neural Networks
CPG & Retail Pricing Optimization Chaid / CART
Consumer Durables Customer Segmentation Genetic Algorithms
Manufacturing and Supply Chain Supply Chain Management Support Vector Machines
High Tech OEM’s Sentiment Analysis
Automotive
Logistics & Distribution
GLOBAL EXPERIENCE.
MANAGEMENT TEAM
PROVEN RESULTS.
Roy K. Cherian
CEO
Roy has over 20 years of rich experience in marketing, advertising and media
in organizations like Nestle India, United Breweries, FCB and Feedback
Ventures. He holds an MBA from IIM Ahmedabad.
Anunay Gupta, PhD
COO & Head of Analytics
Anunay has over 15 years of experience, with a significant portion focused
on Analytics in Consumer Finance. In his last assignment at Citigroup, he was
responsible for all Decision Management functions for the US Cards
portfolio of Citigroup, covering approx $150B in assets. Anunay holds an
MBA in Finance from NYU Stern School of Business.
Buck Chintamani
EVP, Strategic Initiatives & Business Development
Buck has extensive experience working with global clients across sectors.
He was an early employee at Infosys, a founding team member at supply-
chain software startup - Yantra, and part of the management team at RFID
sector startup - Reva. Most recently, he was the Vice-President for Service
Partner Strategy and Programs at product lifecycle management software
company, PTC. Buck has an MBA from IIM Ahmedabad.
Kakul Paul
Business Head, CPG
Kakul has over 6 years of experience within the CPG industry. She was
previously part of the Analytics practice as WNS, leading analytic initiatives
for top Fortune 50 clients globally. She has extensive experience in what
drives Consumer purchase behavior, market mix modeling, pricing &
promotion analytics, etc. Kakul has an MBA from IIM Ahmedabad.
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