A product portfolio is an essential component of any company’s success. It is the list of goods, services, or any combination thereof that a business offers for sale, which can offer a great deal of insight into the inner workings, success, and future prospects of the company. To understand why a product portfolio is so important, let’s look at what comprises one.

Products and services can offer a wide range of value, depending on several factors. These factors range from the direct benefits they offer (such as tangible goods), to the brand they represent (such as intangible ideas or intangible offerings, like software). A company’s portfolio should include offerings of all types and at various price points and targets, to maximize potential profits and audience reach.

When looking at a company’s product portfolio, several aspects can be examined to determine its performance. These include the breadth and depth of offerings, the mix of old and new products, the balance of services compared to goods, as well as the cycle of development and products. Good product portfolios reflect strategic planning and are designed to maintain market leadership or expand into new areas.

Product portfolios vary according to the stage of the company in a number of ways. For example, young and growing companies typically have a smaller portfolio at the start, with more focus on introducing and testing products and services. As the company matures, growth naturally slows and more resources are invested into sustaining the goods and services already established. The portfolio will tend to expand and grow more diverse, as the company seeks to offer a greater selection of offerings and gain new customers.

Overall, a company’s product portfolio offers a lot of information about its current and future success. It reflects not only the goods or services that a company offers, but its strategic planning in terms of how it is investing resources to ensure growth and maintain leadership or break into new markets. By assessing the company's current portfolio, one can gain an insight into how it is managed and the potential for generating revenue in the future.