During the pandemic, many supply chains have been stressed with rapidly changing demand and disruptions in supply.

One way to reduce this stress is to simplify operations.  The supply chain can function better with fewer SKUs (Stock Keeping Units).  This allows supply chains to focus on fewer, more important items, which helps offset some of the additional problems added by the pandemic.

Many organizations are reducing their SKUs, including Kraft Heinz, Coca-Cola, and Hershey.  Coca-Cola has a goal of reducing SKUs by 25%, and has established a mechanism to identify SKUs to be eliminated.

To give you an idea of the complexity of the supply chain, the average grocery store stocks 33,000 SKUs; a Walmart Supercenter will carry around 120,000 items.  Over the years, the number of SKUs has tended to increase.

Offering a greater variety of SKUs provides the customer with a greater selection of items.  This works well when customers are taking their time shopping for items.  During the pandemic, however, many customers are trying to reduce their time in the store to avoid potential exposure to the coronavirus.  Reducing the number of variations of products allows customers to more easily Continue reading →