Discount Sales

Some customers look down upon sales and do not like the idea of wearing garments not in vogue and using things out of fashion. But many welcome a sale to get the best deal. Sales make things affordable. Goods have short life cycles. Sales result in quicker uptake of such goods. They also flatten seasonality. Sales are used to dispose of surplus or leftover stocks. Some items in sales are shoddy. But this is no longer true. Sales can be exploited strategically. Sales may offer an entire range of merchandise, rather than just redundant stocks. Sales are used to improve customer walk-ins. Sales may encourage an unnatural buying habit in the consumers. Their visits in the non-sale period are next to none. In Western countries, markups are high to the extent of 100-125 p.c., and a portion of this is passed on the customer at the time of sale. In India, the mark ups are as low as 25 p.c. , and the same practice of passing on a portion of this meagre mark up puts pressure on the retailer. The competitive pressure makes it compulsory for retailers to announce a sale. A multi-brand store has to announce a sale if a standalone brand store does so. Big brands have a grievance that a sale by them attracts the customer to the store, which then sells him their own brands to benefit from the higher margin. Frequent sales may affect the sales during the festive season. A sale has to be based on good inventory planning. In a sluggish market, discounts keep the cash registers ringing. Some companies push out sales to their factory outlets, rather than holding them at their flagship stores. There are regional variations to be seen in holding a sale, much depends on the performance of a brand in a particular region. Retailers consider a sale as an event and use it imaginatively. Some stores fear that mainstream purchasing gets adversely affected because of discounting.

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