Demanding customers and competitive markets drive companies to increase the number of products and channels to market. The resulting increase in complexity creates a more costly supply chain that is often not quantified accurately when making these decisions.
One method to untangle the supply chain is to do a long tail analysis of product families. This analysis provides visibility into the true incurred costs in supporting a product portfolio with numerous low-volume, high-variability, low margin products. This insight helps frame strategies to reduce complexity and its costs, including rationalization, pruning, and pricing changes.