A global coating manufacturerLean and optimised assortment based on customer needs
A global coating manufacturer had an extensive portfolio of primers and intermediates covering approximately 1/3 of total revenue and carrying a high level of complexity. The coating manufacturer started a project with Implement with the key objective of creating future growth. The goal was to reach a 100% increase in average sales per item while at the same time reducing complexity significantly.
Using an outside-in approach, the project focused on creating a competitive and Lean anti-corrosive assortment based on customer needs. Furthermore, the project made sure that no products offered the same value to customers by positioning all products, ensuring that no products have overlapping positions.
Finally, the project defined a competitive and Lean standard shade assortment.
The project reduced the product portfolio from approximately 7,900 products to approximately 5,600 products through a tail product analysis and commercial assortment optimisation.
The project also reduced the costs of inventory, warehousing, various fixed costs and obsolescence. The total savings amounted to 10% of the total costs.
In addition, the project laid the foundation for future growth – the company saw a 128% increase in average revenue per item over 3 years and a 56% decrease in QSS items over 3 years.
Mini case: Developing a methodology to reduce complexity.
Implement Consulting Group