What is assortment planning?

Assortment planning is the process of deciding which products a retailer will offer in each store, cluster and channel for a season: how many options, at what depth, and how the mix varies by location, so the range meets local customer demand while staying inside financial and open-to-buy targets.

Every season a retailer has a finite amount of money and space, and a near-infinite number of products it could carry. Assortment planning is how that money and space get turned into a specific, deliberate list of choices: this many dresses, in these styles, at these price points, in this depth, sent to these stores. Done well, it puts the right products in front of the right customers and keeps stock working hard. Done badly, it spreads the budget too thin, over-buys the wrong options, and leaves best-sellers out of stock while slow lines pile up in the stockroom.

It sits between two other disciplines. Above it, merchandise financial planning sets the seasonal budget, margin and intake. Below it, buying and allocation execute the plan. Assortment planning is the bridge that converts a financial target into an actual product mix.

The two terms are often used interchangeably, but they answer different questions.

In short: range planning is what do we make; assortment planning is who receives it and in what quantity. A single range can produce many different assortments: a flagship store and a small regional store draw from the same range but get very different assortments.

Every assortment decision is a balance between two levers:

Breadth

Number of options / choices

Depth

Units bought per option

Breadth is variety: how many distinct choices a customer can pick from in a category. Depth is commitment: how many units you buy of each option. With a fixed budget, the two trade off directly: a wider assortment means less depth per option, and a deeper assortment means fewer options. Carry too much breadth and you spread thin, dilute availability and raise markdown risk; carry too little and you look narrow and miss customers. The art of assortment planning is finding the breadth-and-depth mix that maximises sell-through against the money available.

The right balance differs by category role. Core, continuity lines (basic tees, staple denim) reward depth: they sell predictably and rarely mark down. Fashion and trend lines reward breadth: you want more options to test newness, but shallow, so a miss costs little.

Here is a simplified womenswear season, showing how a category budget resolves into options and depth. The buy value is reconciled to the open-to-buy set in merchandise financial planning.

Read across and the strategy is visible: core categories carry few options at high depth (12 core tops absorbing £216k), while fashion categories carry many options at low depth (40 fashion tops testing newness at 320 units each). The option count controls breadth; the depth column controls commitment. If the £764k buy value overshoots the open-to-buy, the planner pulls options or depth until it reconciles, which is the heart of the discipline.

A national assortment sent identically to every store wastes money. A large flagship and a small regional store have different space, footfall and customer profiles, so they should receive different assortments. Store clustering (also called grading) groups stores with similar characteristics so each group gets an assortment sized to its potential.

Clustering turns one plan into several localised ones: the flagship gets the full 90-option range at high depth, while the compact store gets an edited 40 options at lower depth. This lifts availability where demand is strong and cuts overstock where it is weak, which is the single biggest efficiency lever in assortment planning, and the one hardest to run in a spreadsheet at scale.

Set the financial frame.

Take the seasonal budget, margin and open-to-buy from merchandise financial planning. This caps total options, units and buy value.

Define category architecture and roles.

Decide how the budget splits across categories and label each as core, fashion or continuity, which drives the breadth and depth mix.

Plan breadth.

Set an option (choice) count per category that fits the budget and available space.

Plan depth.

Assign planned units per option, weighting depth toward core lines and keeping fashion shallow.

Cluster and localise.

Group stores and size each cluster's assortment to its selling potential.

Reconcile to OTB.

Check the total buy value against open-to-buy and adjust options or depth until it balances.

Hand off and trade.

Pass the plan to buying and allocation, then track it in-season on the WSSI (MFP), editing as options and clusters over- or under-perform.

It lives in spreadsheets disconnected from the budget.

When the assortment is not reconciled live to open-to-buy, teams commit buys that overshoot the plan and discover it too late.

One assortment for every store.

Without clustering, strong stores run out of best-sellers while weak stores drown in stock: the same range, wrongly deployed.

Breadth creep.

Every buyer wants more options; without a hard choice count the assortment widens, depth thins, availability drops and markdowns rise.

No in-season feedback loop.

The plan is set once and never revisited, so early sell-through signals from the WSSI never feed back into repeat buys or edits.

Planning, buying and allocation in separate tools.

The assortment plan, the purchase orders and the store allocation do not talk, so intent is lost in translation between systems.

core runs assortment and range planning as a connected part of the merchmix platform rather than a standalone spreadsheet. Breadth and depth are planned against live open-to-buy, so the buy value reconciles to the financial plan as you build it. Store clustering and grading localise the assortment automatically, and the plan flows straight into core plus for allocation and replenishment, while the WSSI feeds in-season performance back so you can edit options and depth against real demand.

The result is a single thread from budget to option to store: assortment decisions that stay inside the money, respect local demand, and reach the shop floor without being re-keyed between tools.

Assortment planning software

Connect option planning from target to purchase order. See the software

What is a WSSI?

How the weekly plan tracks stock and intake. Read the guide

What is open to buy?

The budget your assortment spends. Read the guide