Use the following strategies to reduce the number of products (SKUs):
Consolidating websites reduces the multiplier. If you have 50,000 SKUs, ten Websites, and ten Customer Groups, the Effective Number of SKUs is 5 million. Removing five Customer Groups reduces the Effective SKUs to 2.5 million.
Use alternative product features for custom pricing to replace shared catalog and customer groups multipliers.
Both customer groups and shared catalog function as multipliers for the number of effective SKUs in a store.
Restructure the catalog—
Reduce the number of products assigned to categories.
Decrease the number of SKUs by decreasing the number of websites, customer groups, shared catalogs, number of products, or number of configurable product options
Provide more product variations by using custom options instead of creating separate products.
Taking into account that an Effective SKU could include a number of potential permutation of prices, because prices can be specified differently per each store or customer group.