Time Right for SKU Rationalization: Willard Bishop

BARRINGTON, Ill. — With conventional supermarket operators under continuing pressure from Wal-Mart Stores [2] and limited assortment outlets, the time is right for conventional operators to employ SKU rationalization and assortment optimization techniques to condense SKU count and increase efficiencies, said Jim Hertel, managing partner, Willard Bishop here.

"There's anecdotal evidence that when you add so much variety, it makes shopping categories difficult," he said during a workshop on shopper-centric assortment last week at the Food Marketing Institute Show in Las Vegas.

In addition to retail support, SKU rationalization has widespread support from CPG firms, according to a survey of sales vice presidents at 25 companies conducted by Willard Bishop.

"Ninety percent of the salespeople say it's the right thing to do," Hertel said. "They say 'We're pushing it because it will make room for our power items that are out-of-stock all the time and have to be continuously replenished, and we're trimming our own portfolios and seeing productivity enhancements.'"

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