The Time is Ripe for Markdown Optimization in Fashion Retailing
Many fashion retailers are still on the fence when it comes to markdown optimization software. Among mid-market retailers in particular, pricing decisions are very much influenced by gut feel, and technology in this area has been embraced predominantly in Tier 1.
Today, changes in the economy and in worker demographics are driving markdown optimization software to the verge of much wider acceptance.
Retailers I’ve talked to recently, including those at NRF, are much more optimistic about the economy than they’ve been in a long time. People definitely sense that the trend is headed up.
At the same time, most people agreed that customers won’t be going back to their old ways any time soon; the landscape has changed. Without the help of free-spending, living-for-the-moment shoppers, retailers will experience more pressure on margins and less room for error. As a result, they are becoming more open to considering markdown optimization software to protect their margins and squeeze more profit from their lower inventory levels.
Changing Buyer Demographics
In the retail buying offices, things are changing. As Baby Boomers retire, new buyers are joining the ranks who are more accustomed to using computers in all aspects of their lives. Not only is the new generation of workers more comfortable using technology, they expect to use software to do their jobs rather than rely heavily on gut feel. This new breed of buyers will increasingly demand to have markdown optimization software in their toolbox—regardless of the size of retailer they’re working for – in order to support and suggest decisions.
Here’s my prediction for 2010.
Expect to see market and demographic forces combining to push retailers of all sizes to increasingly adopt markdown optimization technology to improve their inventory management and pricing decisions.
Posted by Diane Neaven, Director of Product Management, Epicor