The rotation is because they stock the product for which they can negotiate the best discount.
But as you say the 20k SKUs premium stores stock aren’t a necessity. They drive up the costs for the store and the price for the buyer all so the buyer has the feeling they bought something different, when many brands are anyway the same product under different labels.
The premium store 3 minutes from my home stocks 30 types of mineral water. Aldi and Lidl stock maybe 3 of those 30. That’s what 99% of people buy anyway.
> That’s what 99% of people buy anyway
Until there's one less common thing you want. If you don't care much about flavour or have no taste in products then you can sub in any crap food or product.
I go to a particular supermarket because it has the tomatoes I like: they just can't be substituted. It also has an uncommon milk that is the only one I really like. The issue gets harder once you desire specific Deli foods.
How much of SKU selection is driven by individual consumer tastes? Some brand selection is driven by other causes.