What is Assortment Planning? Examples of Assortment Planning in Retail, Fashion and Ecommerce

Assortment planning is a crucial aspect of retail, fashion, and ecommerce business operations that involves the selection and organization of products offered to customers.

It is the process of deciding which products to stock, how much of each to stock, and where to display them in order to meet customer demands while maximizing profitability. 

This article will provide an overview of assortment planning, including its importance and examples of its implementation in various industries, such as retail, fashion, and ecommerce.

What is Assortment Planning?

Assortment planning is a crucial process that enables retailers, fashion brands, and ecommerce businesses to determine the appropriate mix of products they should offer to their customers. The main goal of assortment planning is to ensure that businesses offer the right products at the right time to meet customer demand and maximize profitability.

In simple terms, assortment planning involves deciding which products to sell, how much to stock, and when to introduce or remove products from the product mix. The process of assortment planning typically involves analyzing sales data, market trends, and customer preferences to identify opportunities for growth and optimize product offerings. By taking a strategic approach to assortment planning, businesses can ensure that they have the right product mix to attract and retain customers, while also managing costs and minimizing waste.

Read Now: How To Improve Your Amazon’s Order Defect Rate in 2023

When to Consider Assortment Planning

Assortment planning is a crucial part of inventory management that helps retailers optimize their product offerings and maximize sales. 

Knowing when to consider assortment planning is equally important as it helps retailers avoid several inventory management problems. 

Here are some situations where retailers should consider assortment planning:

Uncontrolled SKU Proliferation

When a retailer offers too many variations of a product or too many products that are similar, it can lead to SKU proliferation. This can make it difficult for retailers to manage their inventory, track sales, and make informed decisions about what products to stock.

Excessive Obsolete Inventory

Retailers often face the problem of obsolete inventory, which refers to products that are no longer in demand. When retailers fail to update their product offerings or introduce new products, they may end up with a surplus of inventory that is no longer sellable.

Regular Stockouts

Stockouts occur when a retailer runs out of stock of a particular product. When this happens frequently, it can lead to lost sales and customer dissatisfaction.

Insufficient Storage Space

Retailers who lack adequate storage space may find it challenging to manage their inventory effectively. They may have to stock products in less than ideal locations, which can lead to lost or damaged inventory.

By considering assortment planning in these situations, retailers can better manage their inventory and avoid common problems associated with inventory management.

How to Get Started With Assortment Planning

Assortment planning is a complex process that requires careful analysis and decision-making. 

To get started with assortment planning, there are a few key steps you should take:

Use Data to Make Informed Decisions

Use sales data, market research, and customer insights to identify trends and understand what products are selling well and which ones are not. This will help you make informed decisions about what products to stock and how much inventory to carry.

Set Realistic Goals

Set clear goals for your assortment planning, such as increasing sales, reducing inventory costs, or improving customer satisfaction. Make sure these goals are specific, measurable, and achievable within a reasonable timeframe.

Consider Improving Your Supply Chain

Improving your supply chain can help you optimize your inventory levels and reduce costs. Look for ways to streamline your operations, such as consolidating orders or working with suppliers to improve lead times.

By taking these steps, you can start building a solid foundation for your assortment planning process and make more informed decisions about what products to stock and how to optimize your inventory levels.

Assortment Planning Examples

Assortment planning examples are an excellent way to understand the different approaches and strategies that retailers use to optimize their product offerings.

Here are some of the most common assortment planning examples:

Wide assortment

This strategy involves offering a large variety of products to customers. This approach is often used by retailers with a broad customer base.

Deep assortment

This approach is the opposite of the wide assortment strategy. It involves offering a limited number of product categories, but a more extensive selection of products within those categories.

Scrambled assortment

This strategy involves mixing different product categories within the same retail space. It is often used by retailers to encourage impulse purchases.

Localized assortment

This approach involves tailoring the product assortment to the specific needs and preferences of customers in a particular geographic area.

Mass-market Assortment

This strategy involves offering products that appeal to a broad audience. It is often used by retailers with a large customer base and a broad demographic.

Each of these assortment planning examples has its own unique advantages and disadvantages, and the right approach will depend on the specific needs and goals of the retailer.

Assortment Planning Optimization

Assortment planning optimization involves fine-tuning your assortment plan to maximize profitability and meet customer demand. 

Here are some key ways to optimize your assortment planning:

Find the right balance between evergreen and seasonal products

It’s important to strike a balance between offering products that customers want year-round and those that are popular during specific seasons. By analyzing sales data and market trends, you can determine which products to include in your assortment and when to feature them.

Leverage Cross-Merchandising

Cross-merchandising involves displaying complementary products together to encourage customers to purchase more items. For example, if you sell cameras, you could display camera cases and memory cards next to the cameras. This can increase sales and improve customer satisfaction.

Understand Omnichannel Market Trends

With the rise of online shopping, it’s important to consider how customers are shopping across different channels. By analyzing data from both online and offline sales, you can better understand customer behavior and adjust your assortment plan accordingly.

Optimize Your Localization Efforts

Localization involves tailoring your product offerings to specific geographic regions or customer segments. By analyzing sales data and market trends in different regions, you can offer products that are more likely to sell well in those areas.

Update Your Assortment Planning Technology

Technology can help streamline the assortment planning process and make it more efficient. Consider using software that can analyze sales data, track inventory levels, and suggest products to include in your assortment plan. This can save time and improve the accuracy of your planning.

E-Commerce Assortment Strategy vs Retail

When it comes to assortment planning, there are some key differences to consider between eCommerce and traditional retail. 

In a retail store, the space is limited, and the products available for sale are typically displayed physically on shelves, whereas eCommerce allows for a larger assortment of products to be made available to customers through an online catalog.

Here are some of the key differences:

Inventory Management

eCommerce allows for a larger and more varied assortment of products to be made available to customers. With online sales, inventory management becomes increasingly important, as the products need to be shipped to customers promptly. This requires a more efficient supply chain and an accurate inventory management system.

Consumer Behavior

When shopping online, customers have access to a much larger assortment of products, and they can easily compare prices, read reviews, and make informed decisions. Retail stores, on the other hand, are limited to the products that are physically available in-store.

Channel Strategy

 With eCommerce, companies have the ability to sell products across multiple channels, such as their own website, social media platforms, and third-party marketplaces. This allows for a wider reach and greater flexibility in how products are marketed and sold.

Assortment Plan for Fashion / Apparel

The fashion and apparel industry requires a unique approach to assortment planning due to its constantly changing trends and styles.

Here are some key things to know and consider when planning your assortment:

Seasonal Variations

Fashion is highly seasonal, and new styles are introduced each season. It’s important to plan your assortment accordingly, with a balance between classic, evergreen items and seasonal products.

Style and Size Range

Fashion and apparel require a diverse range of styles and sizes to cater to a wide range of customers. It’s essential to have a broad assortment of sizes and styles, including both best-sellers and unique items.

Brand and Category Mix

 When planning your assortment, consider the brand mix and category mix. You want to ensure that you have a well-rounded assortment of products that appeals to your target customer.

Inventory Turnover

With fashion, styles and trends change quickly, and inventory turnover is key. It’s important to have an accurate inventory management system in place to ensure that you are turning over inventory regularly and not holding on to obsolete items.

Sustainable and Ethical Practices

More and more customers are becoming conscious of sustainable and ethical practices in the fashion industry. Consider incorporating sustainable and ethical options into your assortment to appeal to this growing market segment.

By taking into account these key factors, you can create an effective assortment plan that appeals to your target customer and ensures a healthy profit margin.


Why is assortment planning important?

Assortment planning is important because it helps businesses to make informed decisions about what products to carry in their inventory.

It ensures that a company has the right mix of products that meet the needs and wants of its target customers. Proper assortment planning can help reduce inventory costs, increase sales and profits, and improve customer satisfaction.

Is assortment planning the same as merchandise planning?

Assortment planning and merchandise planning are related concepts but they are not exactly the same. Assortment planning is the process of selecting and managing the range of products to be offered by a retailer or business. 

Merchandise planning is the process of determining the quantity and timing of the products to be purchased or produced by a retailer or business. Both planning processes are important for a successful retail business.

What kind of data is used in assortment planning?

Retailers typically use a variety of data sources to inform their assortment planning decisions, including sales data, inventory data, customer purchase history, and market trends. This data can be analyzed to identify which products are selling well, which are not, and which new products might be a good fit for the retailer’s customer base.

How often should assortment planning be done?

Assortment planning should be done on a regular basis to ensure that a retailer’s product mix remains relevant and up-to-date. The frequency of assortment planning will depend on a number of factors, such as the retailer’s size, the pace of industry changes, and the complexity of the retailer’s supply chain. Some retailers may conduct assortment planning on a monthly or quarterly basis, while others may do it less frequently.