True or false: Decreasing the number of products sold can improve profits.
  1. True
  2. False
Explanation
Answer: True. Too many products can limit economies of scale, make administration difficult and result in cannibalization.

Key Takeaway: Think of the dynamics of a company that has too many product lines that are similar. We recall one case where a snack machine vendor was sourcing products from so many different vendors, they had little buying power. Consolidating their power as a buyer was the key to unlocking profitability.
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