There is a pattern that repeats itself.

A brand arrives with a sales problem. It wants more work, more product, more options, more SKUs. And almost always, that is not the problem.

The problem is that they do not know what they have.

The illusion of growth through volume

For decades, the industry operated under a simple logic: more SKUs equal more opportunities. More products on the shelf, more chances for something to connect.

The data says otherwise.

According to McKinsey & Company, fashion brands that have reduced their assortment by 15% to 30% have seen gross margin improvements of between 2 and 4 percentage points — with no significant loss in net sales. The problem was not the quantity. It was the structure.

The State of Fashion 2024 report by McKinsey and Business of Fashion points out that the operational complexity generated by excess SKUs is one of the main inhibitors of profitability in mid-market brands. Larger teams, more samples, more negotiation with suppliers, more dead stock at the end of the season.

Zara has been proving the opposite for years: high turnover with a controlled assortment. It is not just speed — it is collection discipline.

What an assortment audit reveals

When we analyze a collection category by category, SKU by SKU, channel by channel, almost always the same thing emerges:

The Pareto principle applied to product is fulfilled with surprising regularity: between 15% and 25% of the SKUs generate between 70% and 80% of sales and margin. The rest exists by inertia, out of habit, or because "last year something similar was sold."

Harvard Business Review documented this phenomenon in fashion retail in its analysis The Hidden Cost of SKU Complexity (2022): the real cost of keeping an unsellable product is not just the inventory — it is the opportunity cost of physical space, tied-up capital, and the management time it consumes for teams.

In footwear specifically, a study by the analytics platform Edited on European mid-price brands (2023) showed that 34% of items introduced in-season had a sell-through rate of less than 30% — meaning that more than a third of the product does not fulfill any real commercial objective.

Architecture before product

A well-built collection is not a list of items. It is a system with explicit roles.

The model we use at QOLABS starts with a simple but operational classification:

• Traffic drivers: products that attract, not necessarily the most profitable ones

• Margin builders: the core of the business, high contribution, stable demand

• Image pieces: positioning, visibility, not always in volume

• Complements: accessories, matching items, brand extensions

When that architecture is not documented — when it lives only in one person's head — the collection grows by default, not by design. Every season, additions are made without removals. What "worked" is replicated without understanding why it worked or if it is still relevant.

The consultancy Kurt Salmon (now Accenture) estimated back in 2019 that 40% of new SKUs introduced annually in mid-sized European fashion brands duplicated functionality with already existing products. Four years later, the problem has not improved — it has worsened with the pressure for immediacy and fast fashion.

The question that changes the work

There is a question I ask at the beginning of any project:

Do you know exactly why each product in your collection exists?

Not "what it does" in the abstract. But why it is there, what role it plays within the architecture, what would happen if it were not there.

Most teams cannot answer accurately. Not because they are bad teams — but because no one has done the work of explicitly articulating that logic and reviewing it with real data.

That is the job.

Before the new product. Before the new season. Before the new campaign.

Understand what you already have.

Bárbara Salus is the founder of QOLABS, an intelligence, product, and business platform for the fashion industry.

References

• McKinsey & Company / Business of Fashion — The State of Fashion 2024

• Harvard Business Review — The Hidden Cost of SKU Complexity, 2022

• Edited — European Mid-Market Footwear Sell-Through Analysis, 2023

• Kurt Salmon / Accenture — SKU Rationalization in European Fashion, 2019