Category Portfolio Analyzer
Balance your product mix. Visualize SKUs on a Price-Volume matrix to identify 'Cash Cows', 'Stars', and 'Dogs' for rationalization.
Portfolio Matrix
Portfolio Health
2 Core Drivers
Top Performers
You have 2 Stars. These generate cash AND profit. Protect them.
Volume Drivers
You have 0 Cash Cows. These keep the lights on.
Dead Weight
You have 2 Dogs. Audit these immediately for liquidation.
Execution Steps
Enter product names, annual sales revenue, and gross margin %.
The Scatter Plot places each product into 4 strategic quadrants.
Use the visual to decide which products to promote (Stars), maintain (Cows), or discontinue (Dogs).
Pro Strategy
- Don't kill 'Cash Cows' (High Vol, Low Margin) just because margin is low. They cover your fixed overhead (rent/salaries).
- Invest in 'Problem Children' (High Margin, Low Vol). Can marketing spend move them into the 'Star' quadrant?
- Ruthlessly cut 'Dogs' (Low Vol, Low Margin). They distract your team and tie up inventory cash.
Core Concepts
BCG Matrix
A strategic tool for portfolio management. It classifies business units or products based on market share (Sales) and market growth (Margin potential).
SKU Rationalization
The process of analyzing metrics to determine if a product should be kept, retrenched, or eliminated to improve overall profitability.
Portfolio Balance
A healthy category needs a mix: High-volume/low-margin items to drive traffic, and low-volume/high-margin items to drive profit.
What is Category Portfolio Analyzer?
This tool adapts the Boston Consulting Group (BCG) Growth-Share matrix for retail category management. It uses Gross Margin % as a proxy for 'Attractiveness' and Sales Revenue as a proxy for 'Market Position'.
Best For
- • End-of-season inventory review.
- • Planning open-to-buy (OTB) budgets.
- • Deciding which products to feature on the homepage.
Limitations
- • Ignores strategic value (e.g. a Dog that brings in a key demographic).
- • Doesn't account for cross-selling effects (Loss Leaders).
Alternative Methods
GMROI Calculator
Focuses specifically on inventory return.
ABC Analysis
Ranking inventory purely by consumption value.
Industry Applications
See how this methodology generates real revenue uplift in different sectors.
Fashion Boutique
Too much inventory, low cash.
Analyzed 50 SKUs. Found 30 were Dogs.
Electronics Store
Low margins.
Identified 'Cables' were Stars (High Margin/High Vol) but hidden in back.