Project Description
Improving margin by establishing better markdown management through rule-based framework, training, and reporting.
The Client
A $15B+ specialty retailer of hardlines and softlines with multiple channels, store formats and brands.
The Challenge
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
- Implement rule-based, localized markdown capabilities
- Establish a markdown training program for merchants and planners
- Implement markdown optimization
Sign up to receive retail and consumer goods insights and strategic advice from The Parker Avery Group.