How many of each SKU should I have?
Dear Camp Counselors,
How many of each SKU should I have on hand prior to doing a trade show?
First, there is no perfect number of SKUs to strive for. You want a product line that is large enough that buyers can pick and choose, and still hit your opening order amount. As much as we’d like them to, they won’t buy everything in your line.
But you also don’t want a huge line that is disjointed or multiple product categories that don’t make sense together.
The answer to this question depends on a number of factors:
How long have you been wholesaling and do you know which products are your best sellers?
What types of products are you offering?
How are you pricing your products?
Are you outsourcing your printing or are you printing products yourself?
Do you have the ability to do a short run of samples for the show?
How fast can you produce your products after the show?
If you’re selling wholesale, consistent inventory should be your end goal. You don’t want to be producing each order as it comes in. It is more expensive and less efficient, both of which cut into your profit margins.
Start small and be conservative, but smart, about your inventory. As your business grows and you have a better handle on your production costs, space constraints, and company goals, you’ll likely keep more inventory and start printing larger runs.
Also, I recommend asking yourself these two questions once a year:
1. Does this SKU still sell well? I’d look at sales data for the previous 12 months to see whether it was top or bottom of the chart.
2. Does this SKU still work well with the rest of my line? Does the aesthetic still align, is it cohesive, does it look good on the shelf together?
If something isn’t selling well and it doesn’t fit with the rest of your collection, discontinue it. If it sells pretty well but doesn’t feel like it fits, I often recommend cutting it. If it fits with the line but doesn’t sell well, I either recommend cutting it or give it another 6 months-1 year to see if it was just a slow starter.
Katie Hunt, Proof to Product