Is Your Markdown Optimization Strategy Leaving Money on the Table?
Markdown optimization guidelines for fashion retailers to clear stock post-COVID
Unsold inventory is a harsh reality, especially for fashion retailers, further exacerbated by COVID-19. The pandemic has undoubtedly disrupted the fashion calendar with apparel and fashion retailers sitting on piles of unsold inventory. What is the way out?
While markdowns in retail are common, the biggest challenge for retailers right now is how to get markdowns right to offset COVID induced losses. Ironically, fashion retailers who are known to be ahead of trends still tend to be traditional in their planning. As every dollar saved is a dollar earned, relying on Excel and intuition to craft a markdown pricing strategy will no longer serve retailers well. This paper highlights the need for a science-based approach for markdown optimization leveraging AI and the merchandiser’s contextual knowledge.