What is Markdown?
Markdown is a price reduction. The designation is used for all types of items for sale, from products in grocery store to securities offered by the seller. They can be introduced for many different reasons. Before marking the price, the current price is considered to be against factors, such as wholesale price of the item and the price offered by competition. Prices are fine art and mistakes can be costly. This may be the outcome of the OverStock, the slow economy or other factors. These types of marketing are used to encourage people to buy to clarify the stocks. This is common in seasonal goods stores that cannot be returned if it is not sold, and strategic shoppers can often find excellent offers by purchasing products off -season products. Markdowns will use securities to achieve prices for products that hold more attractive, and the lead investors to the trade WJE Jim and reduce their stocks that fall in value or do not move rapidly.
MARKDOWNY are also used to get rid of excess supply. In retail, this is a common practice. Retailers must achieve a gentle balance when ordering products for sale. They do not want to play and have an excess of supplies, but do not want to submit and do not have enough to satisfy demand. An imbalance on orders can force retailers to make marketing to get products from the store and create room for new products.
Markdown can also be a form of sales promotion. Trades can use the so -called leading losses, products with significantly reduced prices at which the trade takes loss, to attract people. Some customers just buy a loss leader and have come forward. Others buy other products that are attracted by the hook of the loss leader, and the final result is a profit for the diversion. Getting people in the door may be half the battle and low prices are an excellent way to reach customers looking for an agreement.
prices are often markedENY before the products are initially offered for sale. This allows you to adapt to marking without loss. However, the sale of products must also cover overhead costs such as rent and tools. Products that sit for a long time and eventually sell at the price of Markdown can represent a loss for the company if they do not pay for themselves.