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In the product management world, a great deal of thought, discussion, and planning is given to releasing new products. From the outside looking in, you would think this is all product managers focus on. 

However, knowing when to discontinue, or eliminate an SKU from your product line is just as important as adding one in. 

All products have a lifecycle to them, hence the term product lifecycle, and product lifecycle management (PLM). There’s a beginning, a middle, a decline, and then an end. Whether it’s technology that changes, a way of manufacturing, materials, etc, all products eventually give way to something else. That something else could be a new version, or something completely new and different. 

Given the half-life of technology these days, it can feel like product lifecycles are getting shorter and shorter. New technology comes so rapidly, companies can feel strained trying to keep up. It can be very easy to make a decision in haste without looking at the overall picture. This is also a good time to point out (again) how critically important having a solid product roadmap is. 

You have to approach any decision to discontinue a product from a number of fronts. In certain instances, discontinuation might be forced, or it’s something identified further down the road. The following are a couple examples, but not in any way necessarily all. 

1. Is the Product Still Making a Profit?

This question could seem like it’s the most important of all of them. However, it’s just one in a series of questions you have to look at. A product could still be turning a profit, but hurting you in other areas like production capacity, R&D resources, and customer support. On the flip side of that, it could also be an advantage on other fronts in combination with your other products. This is just the first piece data among many that you need. 

2. Is There a Component or Standard Change Coming?

This is one that tends to hurt companies badly because it’s not monitored well, or accounted for in planning. It can also come quickly, and without warning, especially in the form of new regulations. For example, in the HVAC world when R22 was banned, and also when 13 SEER came into effect for new equipment. Some regulations can also affect components such as when California banned low-lead brass fittings in potable water applications. 

3. Is Technology or Customer Preference Pushing the Market in a New Direction?

Imagine you’re a product manager at IBM in the age of typewriters when the personal computer hit the market. Or, you’re Southwestern Bell when the iPhone debuts. All of these examples are how technology changed customer preferences and behaviors in new ways. You can also see it in the restaurant industry with the rise of “fast-causal” restaurants who promote higher quality food at the same speed and similar cost to many traditional fast-food chains. Many long-time restaurants have had to adapt to stay competitive. In most, if not all cases, these companies have eliminated old, established products to make way for ones that better suited the market.  

The decision to discontinue a product is almost never an easy, or black and white decision. There’s any number of parts and pieces that go into making that decision, and it has ramifications on a number of fronts throughout your business. However, it is a natural part of the life of your products. 

That being said, it can be an intricate part of your product planning process that ebbs and flows with all of your other product activities. This is again where we stress that proper, solid product planning is absolutely critical to the health and well-being of your company. Being able to see where you’ve been, where you are today, and where you’re going in the future can help with anything regarding your product line. We can’t stress enough how much it can help you make decisions like what we’ve been discussing, any make it easier to facilitate. 

Having an outside perspective can be very helpful with making many product planning decisions, especially discontinuation or reduction. At Salyer and Associates, we can assist with an overall evaluation of your product line, and make recommendations where we think you can add in, or trim down.