When is it time to mark down?

Q: The big department stores in my area have already started to go on sale. Sales are slowing a bit in my business, but I’m not ready to mark down yet. Is this a mistake?

A: You should start taking markdowns now. Because we’re at the end of the season, department stores have already begun marking down, and they’ll be fully engaged by the end of May. You risk having to take deeper markdowns later if you do not take them now, and you could lose business.

Also, you need space on your floor for next season’s early product, so you can start generating margin again.

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avatar About Steve Pruitt

Steve Pruitt is founder and Senior Consultant of Blacks Retail Analysis and Blacks Consulting. With over 30 years of experience, Steve is one of the most respected merchandise analysts in the industry. His specialty is apparel merchandising and he has worked with clients in every sector of this category. Steve’s approach is highly customized; he tailors his analyses to the particular needs and market of each client. His work ties together the merchandising piece of the business with the client’s overall financial goals to increase sales and streamline operations. Steve is also a trusted general business consultant, known for his ability to help retailers plan growth and manage change.
 
Ask Steve about merchandise planning and strategy
561-727-8567
Steve@Blksretail.com
www.blacksretail.com
 
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Comments

  1. avatar john kalell says:

    I have to respectfully disagree with Steve Pruitt’s advice to ‘start taking markdowns now.’ Assuming that the question was posed by an individual specialty retailer, one really should be asking “How do I stem the cycle of early (perpetual) markdowns as practiced by the big boys?” Trying to live by their calendar, and matching department store markdowns is a losing strategy. A specialty store can neither survive the depth of reductions, nor keep faith with his/her full price client.
    A retailer can only hope to survive by strongly differentiating his or herself from the herd. There are shoppers who will always go to a department store (or discounter)for the lowest price,but there are still those who will pay for unique product, cleverly presented with a clear focus, and for a service component which a department store can not deliver.

    John Kalell

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