Building Depth of Assortments for the End of the Season
As we approach Halloween and look toward those crazy few weeks between Thanksgiving and Christmas, many independent retailers are wondering just how crazy it's really going to be. Most have taken a very cautious approach to the fall season, and are having to make very difficult decisions about just how aggressive to be for the holiday selling season.
For many independent retailers, inventory levels are lighter than they've been in memory. For some, business has picked up a bit in the last four weeks, but not enough to feel comfortable about committing to significantly more inventory. Still, it's hard for most to contemplate really going into those last weeks with so much less than they've been accustomed to carrying.
The sales trends are dictating that independent retailers proceed cautiously. Inventory levels have to be held in check to prevent costly markdowns in January and February. Focusing on merchandise assortments might help to bring a little more clarity and conviction to those inventory levels.
Generally, the first half of any season is the time to offer your customers a full assortment of merchandise across every category. As the season progresses, assortments narrow and become more focused on the hottest categories, the best sellers, and the proven winners. As the end of the season approaches, those are the items that will generate the most sales with the least amount of markdown risk. By the end of the season, the focus has shifted from being fully assorted to being more narrow and deep.
That's still the best approach for this season. With lighter inventory levels, focus your inventories in those areas that have already proven themselves. Use the dollars you have to build depth rather than breadth. Sacrifice lesser items, lesser sub-categories, lesser categories. These are the areas that you would expect weaker sell-thru's and greater markdown exposure. Instead, focus your assortments on those items and categories that will generate the most sales, the highest sell-thru's and the lowest markdown exposure.