Improving margin by establishing better markdown management through rule-based framework, training, and reporting.
A $15B+ specialty retailer of hardlines and softlines with multiple channels, store formats and brands.
The retailer was transforming its $500 million softlines business. A large component of the expected business benefit would come from shifting clearance margin to regular/promo and increasing the clearance margin rate through better markdown management. Challenges in the current markdown process included:
No seasonality visibility
Limited markdown rules in place
Markdowns taken at national level
No integration to merchandising or marketing calendars
No visibility or control at item level after first markdown
No “what if” capability
The Parker Avery Solution
The Parker Avery Group helped the client address the challenges identified in the current state by recommending six initiatives:
Establish a markdown rules framework by product type
Add markdown rules to the assortment planning process
Improve reporting to provide visibility to markdown performance