Restructuring a Lubricant Portfolio for Profitability
The portfolio included products with overlapping specifications, outdated formulations, and inconsistent naming conventions. Some SKUs had limited sales volume, yet still incurred packaging and inventory costs. The marketing team struggled to communicate product differentiation, and the sales team lacked clarity on which products to prioritize. Additionally, the fragmented portfolio led to poor forecasting and higher operational complexity across warehouses.
We led a comprehensive portfolio rationalization and restructuring initiative designed to simplify the range while strengthening its market relevance. The engagement covered a full product lifecycle review, detailed sales and margin analysis, SKU-level profitability assessment, and competitor benchmarking across key segments. We introduced a clear tiered portfolio architecture (Premium, Standard, Value) for both B2B and B2C product lines. We also defined a consistent naming logic, product role definitions, and formal sunset policies for underperforming SKUs.
Audited all 75 SKUs for sales, margin, lifecycle stage, and formulation overlap.
Benchmarked pricing and performance against top 10 competitors in each segment.
Grouped products into value-based tiers and aligned with customer personas.
Developed SKU sunset matrix with inventory depletion plans.
Standardized packaging sizes and reduced unique bottle types by 40%.
Created unified product datasheets and digital catalogues.
Eliminate 32 low-performing SKUs over a 12-month transition period.
Adopt tiered architecture across all product families with clear value proposition.
Unify naming and labeling system for ease of communication.
Focus R&D on gaps in synthetic and fuel-efficient formulations.
Train sales teams on the new product hierarchy and cross-selling strategies.
By streamlining the portfolio, the client reduced the SKU count by 42% and annual inventory holding costs by SAR 2.4 million. Their gross margin improved by 5.8% through focused upselling on premium lines. Forecasting accuracy increased to 87%, and customer satisfaction scores rose due to clearer product navigation. The total ROI from the project was 4.9x over 18 months.
