How Assortment Planning Increases Sales: A Practical Guide for Retail & DTC Brands

You can be more strategic about assortment optimization when you’ve got a team reviewing and analyzing all of the data. Startup companies that try to run lean by expecting one person to handle demand planning on their own often do themselves a disservice. Expert support (even temporarily!) can help you avoid costly mistakes. 

Improve Sales by Optimizing Your Assortment Through Smarter Demand Planning & Inventory Analysis

You can be far more strategic with assortment optimization when you have a team reviewing and analyzing your data—not just one overwhelmed founder trying to piece together demand planning between meetings. Startup retailers who try to “run lean” by assigning demand planning and inventory management to a single team member often end up with costly missteps: stockouts, excess inventory, and stalled growth.

You're likely in the thick of Q4 holiday sales right now, juggling the nonstop operational challenges that come with retail’s busiest—and most profitable—season. But as you rush to refill inventory, adjust displays, and fulfill orders, remember this:

👉 Holiday selling season is a goldmine of demand signals and assortment insights that can shape your entire next year.

That’s why now is the perfect time to review your assortment strategy and dig into SKU-level performance data. Below, we share best practices for assortment planning, how often to review your assortment, and the smartest ways to analyze product performance using proven demand planning methods.

And because we want to make this really easy…🎁 Download our free Sales Recap Tool below—it’s one of our most powerful tools for SKU productivity analysis and retail forecasting.

Enter your email address and we’ll send you the tool, toot sweet!

How Often Should You Review Your Assortment?

Every retailer is different, but your review cadence should reflect:

1. How many SKUs you have

A small SKU count = fewer cannibalization risks and slower assortment shifts.
A large SKU count = more overlap, more risk, and more frequent analysis needed.

Retailers with big assortments (especially apparel, accessories, beauty, or CPG brands) need ongoing SKU rationalization to prevent wasted inventory dollars.

No matter your size, you should always review your assortment:

• Before committing buys

• During the selling period

• After the selling season ends

This before → during → after cycle is core to professional merchandise planning and demand forecasting.

2. Whether your products are trend-driven or evergreen

Trend-forward brands (fashion, beauty, gifts, décor) should review:

• Sales daily

• Assortment monthly

Evergreen products (home goods, long-lifecycle CPG, furniture, skincare) can rely on longer sales periods before evaluating productivity.

Improve Sales With Strategic Assortment Optimization

Your assortment is the heart of your business. How you review it determines how well you grow.

Ways to Review Your Inventory and SKU Assortment

Your assortment review process should go well beyond “what sold well.” Here are the critical evaluation methods retailers use to improve profitability, avoid stockouts, and reduce excess inventory.

1. Identify Best Sellers + Slow Movers

This is assortment optimization 101.

• Fuel your winners with deeper buys, safety stock, and reorder strategies

• Reduce exposure on slow movers to protect your cash flow

• Use SKU productivity metrics to determine which items earn their shelf space—or storage space

This alone can improve your cash flow dramatically.

2. Trend Analysis

Even without exact numbers, trend visibility helps you:

• Anticipate consumer demand

• Spot emerging categories

• Adjust your assortment proactively

This is essential for staying competitive in fast-moving markets.

3. Competitive Benchmarking

Understanding competitors’ assortment strategies helps you identify:

• Pricing gaps

• Product attribute gaps

• Opportunities for brand positioning

Benchmarking is a powerful demand planning tool for validating your pricing and assortment structure.

4. Category + Subcategory Review

This is where brands uncover their biggest blind spots.

If “tops” is performing well… which tops?

• Crop tops?

• Blouses?

• Long sleeves?

• Basics?

• Going-out tops?

General grouping hides critical demand signals.
Attribute-level planning is a hallmark of high-performing retailers.

5. Balance

Assortment balance ensures you're meeting your customer's full needs without over-investing.

It helps answer:

• Are you over-assorted in one type of item?

• Are you missing key customer needs entirely?

• Which products create excitement, and which ones create consistency?

Balanced assortments equal higher AOV and better customer satisfaction.

6. SKU + Category Productivity Analysis

This is one of the most powerful tools in inventory planning.

Example:
If SKU X sells $1,000/week on 3% of space or cost…
And SKU Z sells $400/week on 10% of space…

SKU X is significantly more productive.

Retailers should reallocate inventory dollars based on:

• Productivity

• Margin contribution

• Forecasted demand

• Strategic role

We do this every day for clients—and it transforms profitability.

7. Cannibalization Analysis

More options ≠ more revenue.

If adding a new item reduces sales of an existing item, your assortment didn't grow—it was diluted.

Knowing this protects your inventory investment and ensures true incremental growth.

8. Assortment Differentiation by Sales Channel

E-commerce vs. in-store assortment should not be identical.

Online:

• Wider assortment

• Niche colors, sizes, and variations

• Higher storage flexibility

In-store:

• Highest-converting SKUs

• Faster-moving items

• Assortments optimized for visual merchandising

Channel-based forecasting is essential to multi-channel success.

9. Pricing Strategy & Variety

Retailers should have good, better, best price tiers to maximize conversion across customer segments.

Your assortment should intentionally reflect this tiering.

10. Margin Mix Evaluation

Profit isn’t just about sales velocity—it's about margin.

Understanding margin contribution by SKU, category, and attribute allows you to:

• Protect profitability

• Price strategically

• Mitigate risk during promotions

Get Ahead and Plan for Your Next Holiday Now

This is the hard truth most retailers resist:

🎄 You’re already buying inventory for next holiday season.

With long lead times, early planning is essential.

Use this holiday data to:

• Re-forecast demand

• Identify assortment gaps

• Validate next year’s buys

• Spot risks early

• Improve cash flow through better Open-to-Buy management

Waiting = overspending or missing out.

Acting early = optimized assortment and stronger profitability.

Measuring Fact Alongside Feeling

Your intuition matters.
But data must lead.

Assortment decisions made on feeling alone create:

• Excess inventory

• Stockouts

• Unbalanced assortments

• Cash flow issues

Blend data + context for the most accurate demand planning.

If the analysis feels overwhelming?
You don't have to do it alone.
This is exactly what Boon does best.

🎁 FREE DOWNLOAD: Boon’s Sales Recap Tool (For Assortment Planning & SKU Analysis)

Our gift to you this holiday season—a powerful, easy-to-use tool designed to help you:

✔ Analyze SKU productivity
✔ Forecast future demand
✔ Identify category and subcategory trends
✔ Surface hidden insights behind your sales
✔ Make data-backed merchandising decisions

Works in Google Sheets + Excel.
Compatible with Shopify.
Zero additional software needed.

📧Enter your email to grab it:

Plan for a Profitable Year with Boon’s Demand & Assortment Experts

We hope 2025 greets you with:

✨ More profitable sales
✨ Fewer inventory headaches
✨ Better assortment decisions
✨ A clearer demand plan
✨ More confidence in your numbers

And if you want expert eyes on your assortment, demand plan, or inventory forecast—
we’re just a message away. Book a call now.

Let’s make this your most profitable year yet.