With the help of the “Product Group Analysis” Dashboard we will be highlighting the most valuable products in the portfolio and identify the products with low sales and margins.
The objective of the analysis is to identify ways to increase the general performance of the product portfolio. In this regard, we brought 3 dimensions:
1. Sales vs. Profit on groups of articles
In this picture we can easily identify 4 areas:
A. Articles with large sales and high profitability. This is the comfort zone, where products must be migrated;
B. Articles with large sales and reduced margins. Identification of the products from this group allows us to take measures for their migration into the A category. For this, the solution may be a renegotiation with suppliers, or identifying and eliminating the unprofitable channels, or a test of price elasticity.
C. Articles with low sales but with high profitability. The sales for items in category C may be elevated by rethinking distribution (to find the relevant segments of consumers), or identifying new sale segments.
D. Articles with low profit and occasional sales. The groups of articles in this section must be subjected to a thorough analysis because it affects the overall performance of the products portfolio.
2. Sales – Profit – Discount
This picture contains 3 dimensional indicators:
A. Income – given by the height of the line
B. Profit – given by the thickness of the line
C. Discount – given by the color of the line
3. Sales channels
This analysis will indicate if an item’s performance is influenced by a particular channel (in which case it could be a distribution error or a poor negotiation).
E.g. Paper Products are in category A (high sales and profitability).
From an analysis of the sales channels we notice though that paper products are in category A solely on the Supermarket and Cash & Carry category.
In the gas station stores, these products have great sales but reduced profitability – category B. This can be remedied by a better bargain with the gas stations chains.
In the hypermarket paper products are in category C (small sales with great profit). This can be caused by improper positioning in supermarkets or the fact that a targeted segment of the product is not found in this location.
The dashboard above is an interactive example from SeniorVisualBI, reproduced using Tableau Public. The database used is a demonstrative one.
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