A product portfolio is the total of products and services that a keeps for sale and for which it receives income.
The size of the product portfolio
The concepts that define the dimension of the product portfolio are the following:
- Length. They are all products that are sold
- Amplitude. Number of product lines. For example: cosmetic line; power line; canine feeding line; etc.
- Depth. Every detail or variation that is presented in each product of the line.
- Consistency. Similarity between the product lines, influencing factors such as frequency of consumer use, manufacturing methods, price, etc.
Example of a product portfolio
Let's imagine a company called COMIDA PARA ANIMALES SA that has 4 types of products, for each animal: dogs, cats, rabbits and birds. Products for dogs are SalchiPerros and AguaPerros; for cats they have Little Fish, Kittens and Water Kittens; for rabbits they have ZanaConejos and AguaConejos; while for birds they have as products the PiensoAves and AguaBuenaAves.
- The breadth is made up of those products that have similarities between them. In this case, we can group products that refer to food and another group for those that refer to special water for these animals. Therefore, the company has 2 product lines.
- The length is calculated by multiplying the number of product lines that we have by the number of articles that each line has: 2 lines and 4 products per line, making a total of 8. The depth is 4, which is the number of variations of products of each line.
- Consistency is based on factors such as consumer usage, manufacturing model, distribution channels, although there are other more subjective ones. We can confirm the existence of consistency in the 4 product lines of COMIDA PARA ANIMALES SA
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