Garmin Needs to Keep Things Simple

In addition to the device's minimalist style, the company kept it simple with just four distinct product lines: the iPod Classic, Nano, Shuffle and Touch. In each line, the company offers a maximum of two choices.

"Apple does a great job of not overloading the iPod with features and not offering too many SKUs," says Winer.

Or consider the popular Flip camcorder from Pure Digital. The pocket-sized camera, which has caught on among consumers for its ease of use, comes in just three flavors: Flip Video, smaller Flip Mino and Flip Ultra.

"That helps keep their costs down and hit a sweet spot of people who want a good device but not have too many choices," says Winer.

Winer points to the 20%-80% rule in consumer electronics. About 80% of sales are generated from 20% of the products, and that's likely to hold true even among Garmin's vast portfolio, he says.

With so many models, Garmin risks not achieving economies of scale, says Barczak.

"Every additional feature or SKU is some additional cost in terms of manufacturing or operations, and, however small, it leads to some inefficiency," she says.

It won't be too long before Garmin is forced to streamline its portfolio, Winer says. And the pressure to do it is likely to come from retail giants such as Best Buy(BBY Quote) and Circuit City(CC Quote) that carry Garmin's products.

"Retailers only want to carry products that have velocity," says Winer. "And as competition increases, the retailers will force Garmin to offer fewer products at better prices."