Gartner Research

How to Strategically Manage SKU Complexity in the Consumer Goods Industry

Published: 27 July 2018

ID: G00367931

Analyst(s): Kimberly Becker

Summary

Changing consumer behaviors, strong competition and growing number of retail channels have driven CG companies to launch more products leading to high SKU complexity. Supply chain leaders must partner with the business to manage this complexity and ensure product portfolios yield profitable growth.

Table Of Contents
  • Key Challenges

Analysis

  • Differentiate Between Good and Bad Complexity
    • Not All Complexity Is Bad
    • It's Not Just About Cutting the Tail
  • Focus on Adding Only "Good" Complexity by Assessing It With an End-to-End Mindset
    • Combine Insights From Both the Commercial and Operational Ends
    • Consider End-to-End Costs
    • Leverage Analytics to Provide Insight
  • Establish a Shared Ownership for SKU Complexity
    • Sponsorship and Governance
    • Top-Level Support
    • Aligned Metrics
    • Must Be a Continual Process — Not a Project

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