5 Ways to Avoid Markdowns on Your Inventory

It’s bound to happen one of these days if it hasn’t already… you will have inventory that simply isn’t selling. Very few retailers never experience this, so let’s consider what you can do to avoid it becoming a big issue.

For starters, never let managing your inventory fall behind on your to-do-list. Between employee relations to merchandising to promotional marketing to social media and more, we know you have a lot to do. But balancing your inventory to sell should always stay top of mind. Below, consider how these pointers can help you:

1. Place Product in Key Focal Points. Merchandising product in primary sight locations throughout the store can draw attention to and highlight goods that are ideal for immediate sales. This is particularly important for high-volume, time-specific selling periods such as holidays or changes in weather for apparel retailers.

2. Purchase “Season-less” Product. Relying on manufacturers that provide products that are non-seasonal and can be sold year-round is a trend in the market, especially as the seasons and weather patterns are no longer consistent. For stores carrying apparel, this means maintaining a product assortment that can be layered and worn year round. For other stores, this may mean finding everyday staples that customers want year-round. Develop a base of basic, neutrally colored items that will be consistent in your store, allowing more “pops” of color and styles with seasonal goods.

3. Rely on Re-Orders. Working with manufacturers that have immediate availability allows the retailer to replenish goods on an as-needed basis. Most manufacturers have minimum orders but also accept a “test” order that allows the retailer to determine if a product is a good fit without investing a large portion of their budget. Once the product starts to sell, the ability to replenish in season allows for the opportunity to react to demand and create higher margins within season.

4. Plan Events for Increased Sales. Creating special events, promotions or parties to elevate sales on specific items – especially seasonal goods – helps to create buzz and increased sell-through… thus alleviating mark-downs. Most manufacturers are open to creative options to generate sales, including consignment sales on product sent for an event and even sending sales support to help educate customers and staff.

5. Strengthen Core Customer Relationships. Developing store loyalty with customers is integral in creating interest in your store’s product. Being aware of key customers that support specific brands or items in your store allows for targeted selling and can even result in sales before product hits the floor. The ability to special order products from retailers can allow for a strong customer following that appreciates their ability to order goods specific to their needs. Encourage this extra TLC among your sales team and ultimately, your customers.

Another tip? Though a bit off the markdown wagon, be sure to  stay dedicated to your store reputation.

Many people shop at one place versus another simply due to the reputation a store has. Take pride in your store and the people who work for you. Set high expectations of your customer service, store merchandising, in-store events, community involvement and product assortment. It’s your responsibility to deliver the best you can and make changes when things are not working. Customers take notice of this, and in return they keep returning to your store. That alone will help avoid markdowns.

Finally, don’t neglect your point of sale and how it can help you manage your inventory. Discover Retail Minded’s choice for POS companies our Resource Guide here, and be sure to use your own POS to manage, review and analyze data again and again and again to help keep sales moving and markdowns low.