13 Portfolio Optimization

Portfolio Optimization empowers retailers with recommendations to enhance portfolio distribution. Leveraging historical sales data, current market trends, and tailored risk assessments, this solution enables retailers to make informed decisions as they strategize for future planning cycles. By accounting for diverse risk approaches and constraints, it ensures a balanced and strategic approach to portfolio management.

The tool delivers actionable insights into the growth trade-offs across various product areas, presenting three optimized outputs: highest growth, lowest risk, and an optimal balance between the two. Users can evaluate these results and select the most aligned option for business planning, reporting, and other strategic initiatives. For instance, the output can seamlessly integrate into Merchandise Financial Planning processes or serve as a foundation for ad hoc planning analysis. This flexibility ensures retailers can adapt the insights to their unique needs, driving more effective and confident decision making.

Figure 13-1 Portfolio Optimization