Clearance sale discounts

Corzhens

Member
How much discount is the optimum amount that you can give to a clearance sale? Particularly for those with semi-perishable goods for their business, clearance sale is a regular thing and their customers already know about it. But how about those non-regular clearance sale like the end-of-the-year inventory to rid of old stocks of dry goods such as household items? For a margin of 30% on the tag price, how much discount is allowable for a clearance sale?
 

explorerx7

New member
Re: Clearance sale discounts

I don't know if there is a stipulation as to how much discount a retailer may or may not give to a customer. Some retailers may seem to be giving a sizeable discount when it's not really so. They sometimes hike the price very near to the sale and at the sale time the price is reduced only to match the original price so, in fact, all they do is trick the consumer.
 

David_TR

New member
Re: Clearance sale discounts

It really depends on the good and the retailer, but I've found largely that clearances will start to go up the longer the item is around. Let's say a store sells everything at a 30% markup over cost - generally, the store will mark them down 20% to still try and sell them over cost, then 30% to sell them at cost, and then it will go down from there. Obviously this will depend on how much the item was being sold for in the first place, and how fast it needs to be clearanced out (since perishables will ALWAYS need to be sold much faster), but I think there's a pretty standard method of reduction you can go by.
 

xTinx

New member
Re: Clearance sale discounts

I think it depends on the item. Different items have different values placed on them so maybe, those that still have a few stocks left, they can be slashed down to 30 percent. Those with enough stocks left, depending on it's marketability, between 50 to 70 percent would do.
 

Norm

New member
Re: Clearance sale discounts

I think it mostly depends on how much you want to dispose of any particular item and sometimes if that item has reached the absolute limit of it's shelf life span then you have to be prepared to sell it at a loss only hoping that you have made enough on all the other items to cover the small difference. At least that is how we do it in our retail store.
 

Vampa

New member
Re: Clearance sale discounts

How much discount is the optimum amount that you can give to a clearance sale?
It depends on how fast you want to sell the items. Huge discounts often get customers to buy something they may not have intended to because they see a good deal and don't want to miss out. That is why I believe discounts of up to 60% will probably get you the results you seek.
 

David_TR

New member
Re: Clearance sale discounts

I think it mostly depends on how much you want to dispose of any particular item and sometimes if that item has reached the absolute limit of it's shelf life span then you have to be prepared to sell it at a loss only hoping that you have made enough on all the other items to cover the small difference. At least that is how we do it in our retail store.
That's actually a great point - even if it doesn't expire, some items just aren't going to sell after a certain point. Football jerseys aren't going to sell as well when it isn't football season, movie merchandise isn't going to move fast after the movie is out of theaters, and so on. Non-perishables really have a limited window for selling in many cases and this is an important thing to consider too.
 

Norm

New member
Re: Clearance sale discounts

That's actually a great point - even if it doesn't expire, some items just aren't going to sell after a certain point. Football jerseys aren't going to sell as well when it isn't football season, movie merchandise isn't going to move fast after the movie is out of theaters, and so on. Non-perishables really have a limited window for selling in many cases and this is an important thing to consider too.
Yup we deal in luxury item retail and we have felt this many times before wherein we are unsure if the trend will last for a certain item so it's best to get rid of stocks as fast as possible with each supply cycle. Sometimes we feel bad for having to sell the items at a loss when it's necessary but it's a much better option compared to being stuck with the items that eventually will completely lose all value.
 

Corzhens

Member
Re: Clearance sale discounts

A boutique owner once told me that their usual markup is 40% for new arrivals of imported items particularly the beauty products. After a month or so when there was no sale in a particular category, they slash down the price for a 20% discount sale (which leaves them with 20% margin). And when after 6 months the item remains untouched then it is due for a 50% discount which means there is a loss of 10% on the mark down. Yeah, it is a clearance sale already because whether the item is sold or not, it will be taken off the shelves.
 

tpicks

New member
Re: Clearance sale discounts

In a shoe shop currently making a clearance sale I find out all the shoes do not have same percentage discount off. I think one factor that determine the amount of discount off the initial price that would be allowed for an item during clearance is how long the item has stayed in the store and if it has become old. I got a clearance sale when I had a 50% off from a pair of shoes, same shop had other shoes for 20% and others for 30% discounts.
 

Alexandoy

Member
Re: Clearance sale discounts

I am not really wary but kind of careful when it comes to clearance sale. Some items have questionable quality simply because it has been in the store for a long time. In one shoe store, some shoes have cracked leather. In a boutique, some clothes were soiled and seams were detached. But generally, clearance sale gives a hefty discount and all you need to do is to check on the items very well so you can get a real bargain.
 

pwarbi

New member
Re: Clearance sale discounts

I think that's the main thing we have to realise when we buy anything from clearance sales, what we are getting is discounted for a reason. We all like a bargain, and some of the items we see on sale in these kind of events is too good to pass up, but on the other hand there may be times when it's too much of a bargain and too food to be true.

As a buyer, we always have to be wary and while keeping a lookout for the bargains, be careful not to end up buying things we don't want, need or even things that no longer work!
 

to7update

New member
Re: Clearance sale discounts

Exactly, it's important to see the reason for the clearance. If they are making clearance because the store is closing or because they will renew collections, those are the best opportunities, as we get good quality items at a big discount price. I always jump to those. :)
 

optimistic

New member
Re: Clearance sale discounts

We are having a big clearance sale in a nearby textile shop which they do every year. I can buy good fabrics at rate which is 50% cheaper. But they are not at loss as they procure these items from another place which is really cheap in bulk quantity. But they can be at loss if they keep the whole stock without clearing it out at a discounted rate because the fashion trends are changing and after sometime they will find it difficult to sell off these products to general public.

So I think it actually depends on the situation and anything that does not harm your business interests can be good. In the above case they are doing it to start selling the new arrivals which can give them more profit.
 

esilv

New member
Re: Clearance sale discounts

When it comes to the very optimum amount that we are allowed to give on any purchase during a clearance period, there is no specifically universal or 'set in stone' amount. It will always vary by many factors. Such factors can include: the business and availability periods of stock and inventory, as well as employees, and the amount of sales generated.
 
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