Trim Your Product Line to Boost Margins and Sanity

When was the last time you stared at a SKU in your catalog and couldn’t recall why you ever listed it? You might have added it on a whim, or to mimic a competitor, but it’s been sitting in the back of your warehouse, collecting dust and eating into your storage budget without pulling its weight.

Start auditing each SKU by margin per hour of work, not just raw profit. Grab a notebook and jot down how much time you spend on fulfillment, answering customer questions, processing returns, and restocking for every item. For example, a cheap phone case that takes 15 minutes to wrap securely, sparks 10 return requests a month, and requires weekly restocking might show a small positive profit—but when you divide that profit by the hours you sink into it, it’s worse than minimum wage. A leather wallet that takes two minutes to pack, has zero returns, and only needs restocking once a month? That’s the keeper.

Ditch any SKU that demands custom packaging or specialized shipping. I once sold hand-blown glass coasters that looked beautiful online, but each order required bubble wrap, foam padding, and signature confirmation. The extra packaging costs ate 30% of the margin, and every damaged item meant a refund and a frustrated customer. I pulled the plug immediately, and suddenly my fulfillment process felt like a breeze instead of a chore.

Merge similar products into a single hero SKU to cut decision fatigue for both you and your customers. I used to sell three sizes of canvas tote bags in five different colors, but a quick survey showed 80% of buyers picked the medium size in charcoal gray. I phased out the rest, and guess what? Sales of the charcoal medium tote went up 25% because I could focus my ads and product descriptions on that one item, and customers didn’t have to scroll through endless options to make a choice.

Resist the urge to add SKUs to “fill gaps” in your catalog. When customers asked for a keychain to match my tote, I held off until I had 50+ repeated requests. Sourcing a new SKU just to check a box ties up cash in inventory and adds another item to manage. Instead, I doubled down on promoting my tote, and those same customers ended up buying two or three instead of a cheap keychain.