As persistent as bamboo, the number of variants of products and services is growing. If variant management is no longer sufficient to achieve adequate profit margins, a variant reduction in marketing and sales is required.
Marketing and sales always find a variety of reasons for even higher numbers of variants. This includes different applications, sales channels and customer specifications, different legal requirements in countries and markets, individualization, differentiation in the competition, design orientation and technical development with limited upward or downward compatibility.
Variant management is often available to ensure profitability. In practice, however, a CFO always finds variants whose margin is not sufficient, if he ranks all the variants by increasing margin.
If the margins are no longer adequate, a variant reduction is necessary not only in production or R&D, but also in marketing and sales. To do this, the variant costs must be sufficiently transparent.
For example, this is not the case if the overhead costs make up a high percentage of the total costs, but are recorded, planned, controlled, as well as pre- and post-calculated in a little differentiated manner. A sufficient differentiation of overhead costs into special direct costs requires technical and commercial know-how as well as independence from company-internal interests.
We advise you to reduce the variants in marketing and sales to be economically more successful.