Markdown strategies are essential in retail for clearing out old inventory, adjusting prices to stay competitive, and driving sales during slower periods. Here's a detailed guide on how to create a Markdown pricing strategy effectively:
Step 1: Start a New Markdown Strategy
Navigate to the Pricing Strategies section.
Click the green Create pricing strategy button.
From the dropdown, select Markdown as your strategy type.
Step 2: Product Selection
Choose how you want to select products:
Dynamic: Products matching filters now and in the future.
Fixed (recommended for markdown): Only the products added now are included.
Click Add products.
Use the product table to select the items you want to mark down. You can filter by brand, category, or sales performance.
Confirm your selection to return to the strategy setup.
Step 3: Define Discount Details
In the Discount details tab, choose a markdown objective:
Get rid of stock: Maximize sell-through.
Maximize profit: Balance margin with sales.
Maximize revenue: Focus on volume and top-line growth.
The platform will generate price suggestions accordingly and show new margin estimates.
Step 4: Schedule the Markdown
Go to the Schedule tab.
Choose a start and end date:
Start immediately or on a custom date.
End date can also be set or left as "Never".
Select your repricing rule:
Require manual approval (recommended).
Or allow automatic approval.
Set a frequency for recalculating price suggestions (e.g., daily).
Step 5: Configure Strategy Zones
Select the store(s) or pricing zones where this markdown should apply.
You can target one or multiple stores, including online.
Step 6: Set Rounding Rules
In the Rounding rules tab, configure how new prices should be rounded.
Add rules for different price ranges, e.g.:
From 20 to 49.99: Closest valid to *.49 or *.99
From 100 to 499.99: Closest valid to *.0
Enable automatic rounding if desired.
Step 7: Add Safeguards
In the Safeguards tab, protect your margins by setting limits:
Price floor: Prevent price from dropping below cost or a fixed percentage.
Price ceiling: Prevent unnecessary increases.
Example: Price floor = Unit margin +10%
Combine safeguards to maintain healthy margins while allowing discounts.
Step 8: Configure Price Change % Rounding
Use the Price change % rounding tab to restrict the percentage markdown options.
Choose to round to fixed values like -50%, -40%, ..., +50%.
Use the generate feature to quickly create intervals (e.g., from -50% to +50% in 10% steps).
Step 9: Save and Activate
Click Create pricing strategy.
Name your strategy, e.g., "Markdown end of season".
Review the summary:
Objective
Product count
Timing
Click Save.
Your Markdown pricing strategy is now active and will start repricing products based on your configured rules and schedule.
