Limited store space: Maximizing profit with assortment optimization
4R Systems, Inc. announced a new solution designed to increase profit.
4R's solution positions retailers to model demand for products in a category by their attributes and find the best set of products to maximize sales or profit. AO also helps determine the optimal number of products for a retailer's omnichannel inventory.
4R President and CEO Kevin Stadler said, "We leverage behavioral analytics to accurately determine consumer demand. Further, our solution can accurately predict the probability shoppers will select a similar product when the first choice is unavailable. These analytics can help unify your entire supply chain and increase profit."
The Assortment Optimization Solution moves far beyond traditional SKU rationalization to optimize, and not just reduce, assortment. There are four major benefits to the assortment optimization solution:
- The AO solution uses actual store sales history and advanced behavioral analytics to accurately determine consumer demand for products.
- AO doesn't just identify products that should be dropped, it suggests products that should be added to the assortment and calculates the financial results of the optimal assortment.
- AO enables retailers to determine the optimal level of assortment localization for their business and the best assortment for each location in the entire retail chain.
- AO incorporates market basket and other data sources into its optimization logic to find assortments that improve, not reduce, sales results.
Assortment Optimization, like all solutions developed by 4R, is cloud based. It requires no capital investment, no additional staff, and minimal IT resources.
"Certainly, retailers will see improved efficiency and better decision making capabilities with our assortment optimization solution. The real win here is increased profit in short order for the retailer. That's why we do this," revealed Stadler.