At a glance
A leading electronics retailer in the GCC and MENA region unlocked a ~9.1% potential increase in Average Selling Price (ASP), identified ~22% revenue loss from stock-outs, and improved inventory mix using Increff’s data-driven assortment optimization framework across 20 stores.
What Is This Case Study About?
This case study highlights how Increff’s assortment optimization solution helped a leading electronics retailer align store-level inventory with localized demand. By leveraging a Smart Assortment Plan, the retailer improved assortment depth, width, and pricing decisions—unlocking higher margins and reducing missed revenue opportunities.
Client Overview
- Industry: Consumer Electronics Retail
- Region: GCC & MENA
- Store Network: 20+ retail stores
- Product Categories: Mobile Phones, Notebooks, Appliances, Wearables, Gaming Consoles
- Key Challenge: Misalignment between store-level assortment and localized demand
Challenges Faced: Why Assortment Misalignment Was Hurting Performance
As the retailer managed a diverse and high-value product portfolio, several operational gaps emerged:
- Poor Store-Level Assortment Alignment: Inventory breadth and depth were not tailored to local demand, leading to inefficient assortment mix and lost margin opportunities.
- Limited Visibility into Store Performance: Lack of granular, recent performance insights made it difficult to identify high-performing vs. underperforming products.
- Stock-Outs on Top-Selling Products: High-demand items—especially in mobile phones—frequently went out of stock, impacting revenue significantly.
- No Standardized Decision-Making Framework: The business lacked a consistent, data-driven approach to evaluate assortment performance and take corrective actions.
Increff’s Solution: Data-Driven Assortment Optimization at Store Level
Increff implemented a smart assortment planning framework that enabled precise, store-level decision-making across inventory, assortment, and pricing.
Smart Assortment Plan (Core Engine)
Each store received a tailored assortment strategy driven by two key levers:
Optimum Depth (How Much Inventory to Hold)
- Predicted ideal stock levels based on demand contribution at store + attribute level
- Adjusted for availability gaps and liquidation distortions
- Incorporated seasonal and festive demand patterns
Optimum Width (How Many Styles to Offer)
- Recommended optimal number of SKUs per store
- Reduced long-tail inefficiencies by eliminating low-performing styles
- Customized assortment width based on localized demand patterns
- Factored in planogram constraints and minimum display requirements
Advanced Data & Analytics Setup
- Analyzed daily sales and inventory data across 20 stores
- Focused on top 75% revenue-contributing categories including mobiles, appliances, and wearables
- Enabled BI dashboards for continuous performance tracking and decision-making
Discount Optimization
- Evaluated real-time merchandise performance
- Recommended higher discounts for slow-moving inventory (~19%)
- Suggested lower discounts for high-performing stock (~50%)
- Ensured pricing decisions stayed within defined business guardrails
Results: Measurable Impact from Assortment Optimization
“Increff enabled the retailer to unlock significant margin and revenue opportunities through smarter assortment and pricing decisions.”
- ~9.1% potential increase in Average Selling Price (ASP) through optimized assortments
- ~22% potential revenue loss identified due to stock-outs in top-selling mobile phone styles
- Improved inventory contribution mix, including:
- ~4% increase for Mobile Phones
- ~2% increase in revenue contribution for Notebooks
- ~8% reduction in inefficient contribution from Wearables
- Smarter discounting strategy across categories:
- ~19% stock identified for higher discounting
- ~50% stock identified for optimized lower discounting
Key Outcomes Summary
- Shift from intuition-led to data-driven assortment planning
- Improved margin potential via ASP uplift
- Reduced revenue leakage from stock-outs on top sellers
- More efficient inventory mix across categories and stores
- Smarter pricing decisions through performance-based discounting
- Strong foundation for scalable, localized merchandising decisions
Frequently Asked Questions (FAQ)
What is assortment optimization in retail?
Assortment optimization is the process of selecting the right mix of products (width) and quantities (depth) for each store based on demand patterns, ensuring maximum sales and profitability.
How does Increff’s Smart Assortment Plan work?
It uses data-driven models to recommend optimal assortment width and depth for each store, based on demand contribution, performance trends, and constraints like space and seasonality.
What is the impact of assortment optimization on ASP?
Optimized assortments improve Average Selling Price (ASP) by prioritizing high-value, high-demand products while reducing low-performing inventory.
How does assortment optimization reduce stock-outs?
By identifying top-selling SKUs and ensuring sufficient depth, it prevents stock-outs and reduces revenue loss from unmet demand.
Can assortment optimization improve discounting strategies?
Yes. It enables targeted discounting—reducing discounts on high-performing products while increasing them for slow-moving stock to improve sell-through.
Which retailers benefit most from assortment optimization software?
Retailers with large SKU catalogs, multi-store operations, and diverse demand patterns—especially in electronics, fashion, and omnichannel retail—benefit the most.
Why Increff for Assortment Optimization?
Increff helps retailers move beyond static merchandising decisions to dynamic, data-driven assortment strategies:
- Store-level precision in assortment planning
- Advanced analytics & BI dashboards for continuous optimization
- Integrated pricing and discount intelligence
- Designed for large-scale, multi-category retail operations
- Proven impact across electronics, fashion, and lifestyle retail
Ready to Optimize Your Assortment?
Unlock higher margins, better inventory efficiency, and smarter merchandising decisions with Increff.
👉 Book a demo with Increff today and transform your assortment strategy.