Q: Spring has gotten off to a slow start in my store. Should I get more proactive with taking markdowns?
Steve Pruitt: I understand your concern, and markdowns are an important part of doing business. But, specialty stores should remember that customers aren’t coming in looking for deep discounts and “crazy deals”. They are walking into your store because they know that you have special products that they cannot find anywhere else.
So, I’m telling my specialty retailers to really focus on their “markdown cadence”. This means taking small, incremental markdowns at the beginning of the season (10% – 15% off) to pique customers’ interests, and then following with slightly deeper discounts when traffic or sales start to slow. Pay attention to what the big box stores are doing, but don’t feel that you need to compete with them.
Right now, we’re starting to see an upswing in spring selling, so be wary of giving away more margin than you absolutely have to. Focus on creating exciting events that will build traffic instead. Good luck!
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