Does Product Variety Increase Product Sales?

In the article ‘effects of product variety and inventory on retain sales’ by Zeynep and Raman, product variety has much impact on its sales. The article examines the effect of the product variety and inventory levels on sales. Product variety involves producing more different forms of a product. Different people have different preferences and opinions. For an organization to be able to cater for these differences, product variety is essential. By producing a variety of different products then the needs of many customers get fulfilled. This article confirms that increasing a product variety increases its sales thus increased profits to retail shops. the information obtained from this article is credible enough to provide prove on the specific impact of brand verity on company sales. Increasing the variety of a company’s products increases inventory levels which helps meet the customer needs. The article also shows the indirect negative impact of product variety on phantom product at store. Sweeney and Donald in the article ‘the impact of product variety on retailer operational performance and sales’ confirm that product variety increase the amount of sales made in a retail business.  The article examines the effect product variety has on inventory levels, stock out rates and sales. When different products are produced the inventory levels increase. This case requires a complex management system to monitor and control the inventory. There are more complications involved with product variety in an organization. chain supply management becomes complex. The article shows the different relationship of brand, size and product line variety to inventory levels and sales. It also confirms that despite the fact that product variety increases retail sales, it also increases the operational performance of a business. There is increased operations in an organization when it produces a variety of products to meet customer needs.

Reference

Ton, Zeynep, and Ananth Raman. “The effect of product variety and inventory levels on retail store sales: A longitudinal study.” Production and Operations Management 19.5 (2010): 546-560.

Sweeney, Kevin Donald. THE IMPACT OF PRODUCT VARIETY ON RETAILER OPERATIONAL PERFORMANCE AND SALES: EVIDENCE FROM CHINA. Diss. 2015.