Wholesalers: Use this SKU Analysis Model
Inventory management is a tough job. Knowing what brands to bring in, what to pass on, and what to get rid of is one of the toughest parts of the business.
Two questions for you:
- What is your process for deciding what new suppliers, brands or SKUs to bring into the portfolio?
- What is your process for eliminating suppliers, brands or SKUs from the portfolio?
If you’re looking to update your current portfolio management process, the SKU analysis model below may be useful.
The model is intended to value each supplier, brand and SKU using both objective (measurable) and subjective (intangible) criteria.
There are 5 measurable points which take into account sales volume, gross profit, and sales trends.
And there are 5 subjective areas to consider like chain store authorizations and potential future growth of the brand.
Here’s an example:
The scoring system allows you to make comparisons between suppliers, brands and SKUs.
Which brands are over-performing compared to their peers? Which SKUs are under-performing?
The model is designed to get you thinking about how to apply this concept to your inventory management game plan.
Your criteria and scoring mechanism may be different, and should be built to align with your portfolio mission statement.
However, the concept here may be helpful for you – score your inventory, rank the results, and make your portfolio decisions accordingly.
Do this next:
- Download the SKU Analysis Model
- Learn more about our Beer Business Finance educational programs
