What does the term "contraction" refer to in a company's product mix strategy?

The term "contraction" in a company's product mix strategy specifically refers to the process of eliminating lower-performing products or lines from the product offerings. This strategy is often undertaken to streamline operations, reduce costs, and focus on more profitable items. By removing less successful products, a company can allocate resources more effectively, enhancing the overall performance of the product mix.

This approach allows the company to concentrate on its strengths and improve efficiency, ensuring that the products remaining in the lineup resonate more with consumer demand. Contraction can also lead to a cleaner brand image, as it eliminates confusion for consumers regarding product choices. In contrast, the other options focus on expansion or improvement rather than the strategic refinement that contraction involves.