What is meant by assortment planning?

Assortment planning refers to the strategic selection of products that will be offered within a specific category, based on the analysis of consumer demand, preferences, and sales data. This process ensures that the retailer stocks products that resonate with customers, satisfying their needs and preferences while also maximizing sales potential.

The correct answer emphasizes the importance of demand analytics in determining which products to include in a category. By carefully selecting products that align with consumer trends and preferences, retailers can enhance customer satisfaction and drive sales, making assortment planning a critical aspect of category management.

Other options touch on related activities but do not capture the essence of assortment planning. For instance, choosing the number of shelves pertains more to shelf space allocation rather than the selection process. Negotiating prices with suppliers is a fundamental part of procurement and cost management, while designing promotional signage is related to marketing strategies rather than product selection. Understanding that assortment planning focuses specifically on the selection of products based on demand differentiates it from these other functions.