An assortment matrix is a table showing every product in a planned range against its role, customer, price, unit cost, margin, minimum order and launch timing. For a new brand, its main purpose is to decide what not to launch. Budget spread across dozens of SKUs leaves too little stock, testing and marketing for the few that could carry the brand. A matrix makes the trade-offs visible before anyone orders anything.
What to put in the matrix
Each row is one SKU, counting each size, colour or flavour as its own line. Use these columns:
| Column | Why it matters |
|---|---|
| Role | What the product does for the range (see below) |
| Target customer and use | Forces you to say who it is for |
| Channel | Margin, pack and minimums differ per channel |
| Retail price, price after fees | Shows what actually reaches you |
| Landed unit cost | Product, pack, freight and duty |
| Contribution per unit | What remains after all variable costs |
| Minimum order and cash required | Shows true cost of including this line |
| Testing and compliance | Adds time and money, sometimes per colour |
| Shared components | Same bottle, fabric or box means less risk |
| Launch wave | First, second, or later |
Give every product a role
If a product has no role, it probably belongs in a later wave. These roles work in most categories:
- Hero: the reason the brand exists. It carries the story and most of the marketing.
- Traffic builder: an accessible price or a familiar need that brings new customers.
- Margin earner: a bundle, refill or accessory that lifts profit per order.
- Range completer: a product buyers expect to find, which allows a retailer to list a set.
- Test: a small bet to learn something specific, with a clear stop rule.
A first range might have one or two heroes, plus one or two supporting items. Few new brands can fund more than that properly.
Build a price ladder
Lay your products out by price from lowest to highest. Check for gaps and overlaps. Two products at nearly the same price with similar uses compete with each other. A gap might be a real opportunity, or a sign that buyers do not want anything there, so check competitors and actual sales data before filling it. Include the channel’s view: a retailer will usually apply its own margin, and that sets the shelf price from which you work back.
Count the SKU multiplication
Variants are where new brands overspend without noticing. A garment in 4 colours and 6 sizes is 24 lines. A cream in 3 scents and 2 pack sizes is 6, each potentially requiring its own artwork, and sometimes its own test evidence and notification. Before adding a variant, ask whether a customer who wanted it would refuse to buy the existing option. If not, leave it for later.
Compliance can make variants expensive. In US children’s products, a change of material or colour can require more testing. In EU hazardous mixtures, a change in formula beyond the allowed limits calls for a new Unique Formula Identifier and notification. See our category pages for your product. This is general information, and the requirements for your range are confirmed with a specialist in the project.
Use shared components
Plan the range around things that can be shared: one bottle in several formulas, one fabric in multiple styles, one printed box with a variant sticker. You meet minimums at the component level, cut stock risk and simplify reorders. Souvenir ranges often work this way, with many designs on a few base products. The same logic applies to a gift range or a home line.
Score it, then cut
Give each candidate a simple score on: demand evidence, contribution per unit, cash needed, compliance burden, difference from what already exists. Do not over-engineer this. The purpose is to start a conversation with facts, and to force a ranking. Then draw a line where your budget ends, remembering to keep a reserve for launch costs and a reorder.
An example, for illustration
The figures below are invented and only show how to read a matrix.
| SKU | Role | Contribution per unit | Cash for minimum | Decision |
|---|---|---|---|---|
| A: Main product, size 1 | Hero | €8 | €6,000 | Wave 1 |
| B: Starter size of A | Traffic builder | €2 | €2,000 | Wave 1, shares pack with C |
| C: Refill of A | Margin earner | €6 | €2,500 | Wave 2, once repeat buyers exist |
| D: New variant of A | Test | €7 | €6,000 | Later, needs its own stock and test evidence |
| E: Unrelated accessory | None clear | €3 | €4,000 | Cut |
Notice that the refill waits, even with a strong contribution, because it only sells once customers have bought the original. Item E was removed because nobody could explain what it did for the brand.
Common mistakes in a first matrix
- Using factory price instead of landed cost, which makes every line look better than it is
- Leaving out compliance cost per variant, so a cheap colour turns out to be expensive
- Copying a competitor’s full range without their scale or history
- Treating every product as a hero, so that none gets real support
Update it after launch
A matrix is a working tool. After launch, add real sales, returns, reviews and reorder rates. Move items between waves on that evidence, and be prepared to delete weak SKUs, since slow items tie up cash and warehouse space. A good early discipline: for every product you add, ask which one could go.
Retail and distribution customers will often read a well-made matrix as a sign of seriousness. See private brands for retailers. Assortment is a separate deliverable in our process, which you can order alone: see assortment planning, or check a single line’s numbers with the calculator.