Optimizing your product assortment for industrial buyers is a very tricky task. In theory, you want to feature as many items as possible. Not only would this increase your profits, but it will also establish you as one of the top suppliers for a specific product line.
Unfortunately, having so many options comes with a cost.
First, you’ll need enough warehousing space to keep all the inventory (whether we’re talking about the parts or the finished products). If you’re a manufacturer, you’ll also encounter numerous challenges in differentiating your assortment. For example, you’ll have to decide when and how many items you want to roll out each month.
These challenges are even worse if your main buyers are large industrial companies. To cater to their needs, you’ll have to optimize all internal processes without running out of products or parts.
What Makes Product Assortment Important?
Product assortment has a major impact on your profitability. It is one of the main ways you differentiate yourself from other competitors, and can have both positive and negative effects on your business. Here are a few reasons why optimizing your assortment is important:
Enhances Customer Experience
When you pair optimized assortment with effective catalog management, you can provide people with exactly what they need. Companies that listen to their target audience enjoy a much better position on the market while providing a superb customer experience.
Increased Sales
“Industrial customers often look for customized solutions tailor-made for their business,” according to BORG Pumps GMBH, a German pump and drill supplier. “This is especially true when talking about industries such as construction, engineering, or mining.”
Having a wide variety of options ensures that potential buyers don’t have to go elsewhere for their products, parts, and materials. Furthermore, a large assortment is vital for retaining these clients. The main goal is to convert as many leads as possible while staying profitable.
Higher Profits
Optimizing your product assortment for industrial buyers lets you focus on things that sell. Rightsizing your assortment reduces the need for large warehouses and additional marketing. Instead, you can prioritize products that will ensure the highest profitability with minimal input.
5 Best Strategies for Enhancing Your Product Assortment
No matter how you promote your products to industrial buyers, there are a few strategies that always work. Here are the five main widely accepted strategies:
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Deep Assortment
If you decide to go with a deep assortment approach, you’ll have to increase the number of products per category. On the other hand, this tactic reduces the number of categories, prioritizing types of items that are most profitable or have the highest strategic value.
With the deep assortment approach, you can focus on the needs of a very specific industrial audience. As an advantage, you’ll maximize the customer experience of your ideal clients while neglecting buyers who might not be relevant to your brand in the long run.
Deep assortment strategy allows you to improve the quality, design, and price of a limited number of items and dominate that particular market. For example, you won’t sell pumps, drills, motors, and pistons. Instead, you’ll only focus on pumps, but you’ll provide many more options to buyers.
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Wide Assortment
The wide assortment strategy revolves around a wide range of categories and products, and it is the polar opposite of the deep assortment. Basically, you’ll feature all sorts of unique products, but you won’t have that many variations for each one of them.
This approach is particularly suitable for businesses targeting a broad range of clients. Unfortunately, if your target is just companies that seek products with exact features, you won’t be able to sell your inventory.
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Mixed Assortment
Besides offering your core products, you can always insert a few products out of the left field. By using a scrambled assortment strategy, you can try to close clients who otherwise wouldn’t do business with you. Besides boosting profits, this is a great strategy for introducing your brand to a broader number of clients.
Mixed assortment strategy is especially valuable before executing a wide-scale diversification. For example, it allows you to test the market, to see how potential clients would react to new items. Sometimes, the mixed assortment is a great tactic if you wish to upsell the existing clients.
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Mass Market
The mass market is the most complex strategy on the list. With it, you’re trying to sell a wide variety of products from different categories to as many people as possible. You’re not trying to cater to a specific audience, but instead, you’re looking to maximize profits by all means necessary.
Mass market combines the wide assortment and the deep assortment approaches. The tactic may not be that common for industrial buyers, but you can see it with companies such as Target or Walmart.
Although this tactic is fantastic for boosting your revenues, it comes with various challenges. Simply keeping track of these products is challenging. You might also have trouble providing proper specs and offering support/maintenance for these items. You might also experience difficulties in securing storage space and materials.
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Localized Offer
Besides targeting international industrial buyers, you can also focus on clients in your city, region, or country. When you localize your offer, you’re modifying the assortment according to these buyers. That way, when they come to your store, they can find just the thing they need to continue with their own production.
For example, some industrial suppliers tailor their offers based on the needs of local factories. They might prioritize parts and equipment that the buyers use on a daily basis, ensuring they get the first call in case of a breakdown.
Last Thoughts
Optimizing your assortment for industrial buyers isn’t that hard. The main thing you need to do is assess the needs of your ideal customers. Some companies target local manufacturers, becoming their main suppliers for tools, parts, and equipment.
We recommend exploring different assortment strategies until you find the one that works best for you. Just make sure you do the planning properly to avoid unnecessary expenses.
Angus Roberts is an expert in healthcare IT and HIPAA compliance. He has a strong expertise in AI and Cloud technologies and has been working with these technologies for the past decade. Angus is also a frequent speaker at conferences in the US and Europe on topics related to cloud, AI, healthcare IT, HIPAA compliance, cybersecurity, data privacy and more.