Assortment size and category sales: is there a direct relationship?

Abstract

Assortment is one of the most important tools for retailers differentiating themselves from competitors, attracting customers into the store and increasing their sales. This paper analyzes the relationship between assortment size – in terms of number of Stock Keeping Units – and category sales level. In order to do this, a panel database containing information about assortment size and sales per week between 2008 and 2012 for all hypermarkets and supermarkets operating in Spain is used. Our results confirm a positive and significant relationship between both aspects; nevertheless, the intensity of such result depends on the frequency and penetration of the category under study