Retail Operations
Merchandising and range planning: building an assortment that fits the market
Range architecture, space allocation and localisation: how to decide what to carry in each market and how much space to give it once it is there.
Guide 8 of 9 · 11 min read · Updated 5 August 2026
Range decisions made in a head office two thousand kilometres away are the most common cause of slow-moving stock in Asian retail. Not because the products are wrong, but because the range architecture assumed one customer, one price ladder and one shopping mission across markets that share none of the three.
This guide covers the structure of a range, the localisation decision, and how space follows contribution rather than tradition.
Range architecture: good, better, best
A workable price ladder has three visible tiers with a clear reason to trade up between them. Where the middle tier is thin, customers default to the cheapest line and average selling price falls. Where the ladder has six tiers, customers stop understanding it and default to the cheapest line anyway.
- Entry tier: defends against a competitor's price message, kept deliberately narrow.
- Core tier: carries the volume and most of the margin; deepest choice sits here.
- Premium tier: sets the quality reference; small, visible, and not discounted.
How much to localise
The pragmatic split most regional retailers land on: roughly 70% of the range common across markets, 20% adapted in size, pack or flavour, and 10% genuinely local. Below that level of localisation the range feels imported; above it the buying scale that made the business work disappears.
- Common regional range70% of SKUs
- Adapted (size, pack, flavour)20% of SKUs
- Fully local10% of SKUs
Common range preserves buying scale; local range earns relevance.
“The pragmatic split most regional retailers land on: roughly 70% of the range common across markets, 20% adapted in size, pack or flavour, and 10% genuinely local.”
Space allocation follows contribution per square metre
Space is usually allocated by history and defended by whoever owns the category. Reallocating by contribution per square metre, margin after markdown divided by the space it occupies, moves space from familiar low-return categories to smaller, denser ones, and is one of the few sales levers that costs nothing.
Do it gradually: 10-15% of space per review cycle, so the effect is measurable and reversible.
Reviewing the range without churning it
A good review cycle removes the bottom tail on a clear rule, protects a small number of strategic lines regardless of rank, and holds new lines long enough to have a fair trial. Ranges that change more than about a quarter per season stop building customer familiarity and start creating markdown.
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