{"id":8435,"date":"2023-05-19T17:57:54","date_gmt":"2023-05-19T17:57:54","guid":{"rendered":"https:\/\/www.shipbob.com\/uk\/blog\/retail-markdown\/"},"modified":"2024-03-12T17:09:13","modified_gmt":"2024-03-12T17:09:13","slug":"retail-markdown","status":"publish","type":"blog","link":"https:\/\/www.shipbob.com\/uk\/blog\/retail-markdown\/","title":{"rendered":"Markdowns in Retail: Turn Overstocked into Optimised With a 3PL"},"content":{"rendered":"\n<div class=\"wp-block-shipbob-blocks-single-toc single-toc\" data-controller=\"blog-toc-controller\" data-action=\"scroll@window-&gt;blog-toc-controller#scrollChanged:passive\" id=\"toc-component\"><div class=\"single-toc-overview\"><p>Table of Contents<\/p><div class=\"single-toc-read-time\"><p>** Minutes<\/p><\/div><\/div>\n<p><a href=\"#h-what-is-a-markdown-in-retail\">What is a markdown in retail?<\/a><\/p>\n\n\n\n<p><a href=\"#h-the-importance-of-pricing-markdowns-in-retail\">The importance of pricing markdowns in retail<\/a><\/p>\n\n\n\n<p><a href=\"#h-retail-markdown-strategies-for-the-modern-world\">Retail markdown strategies for the modern world<\/a><\/p>\n\n\n\n<p><a href=\"#h-the-costly-downsides-of-markdowns-in-retail-and-ecommerce\">The costly downsides of markdowns in retail and ecommerce<\/a><\/p>\n\n\n\n<p><a href=\"#h-reduce-markdowns-with-inventory-management\">Reduce markdowns with inventory management<\/a><\/p>\n\n\n\n<p><a href=\"#h-get-started-with-shipbob\">Get started with ShipBob <\/a><\/p>\n\n\n\n<p><a href=\"#h-markdown-in-retail-faqs\">Markdown in retail FAQs<\/a><\/p>\n<\/div>\n\n\n\n<p>In the highly competitive world of retail, businesses are constantly looking for ways to attract new customers and move inventory. One commonly used strategy is to mark down items. This involves reducing the original price of a product to encourage sales and clear out excess stock.&nbsp;<\/p>\n\n\n\n<p>However, while markdowns can be an effective way to manage inventory and boost sales, they also come with potential downsides, such as:&nbsp;<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Reduced profit margins<\/li>\n\n\n\n<li>Negative impact on brand perception<\/li>\n\n\n\n<li>Unnecessary holding costs<\/li>\n<\/ul>\n\n\n\n<p>There\u2019s a reason why <a href=\"https:\/\/ca.louisvuitton.com\/eng-ca\/louis-vuitton-outlet\">Louis Vuitton<\/a> never goes on sale.<\/p>\n\n\n\n<p>In this post, we\u2019ll delve into the world of markdowns in retail, covering the importance of pricing, effective strategies, and the role of <a href=\"https:\/\/www.shipbob.com\/3pl\/\">third-party logistics<\/a> (3PL) providers, like ShipBob, in optimising <a href=\"https:\/\/www.shipbob.com\/inventory-management\/\">inventory management<\/a>.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-what-is-a-markdown-in-retail\">What is a markdown in retail?<\/h2>\n\n\n\n<p>A markdown in retail is a deliberate reduction in the original selling price (often referred to as MSRP, or manufacturer&#8217;s suggested retail price) of a product.<\/p>\n\n\n\n<p>Retailers typically use markdowns to clear out old or slow-moving inventory, make room for new products, and recoup some of the costs associated with carrying unsold merchandise.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-the-importance-of-pricing-markdowns-in-retail\">The importance of pricing markdowns in retail<\/h2>\n\n\n\n<p>For some businesses, markdowns are crucial. They can be a lifeline for retailers facing slow sales periods or <a href=\"https:\/\/www.shipbob.com\/blog\/overstocking\/\">overstocked inventory<\/a>.<\/p>\n\n\n\n<p>By lowering the retail price, businesses can stimulate demand for their products and remain competitive in the marketplace.<\/p>\n\n\n\n<p>Retailers typically introduce markdowns during seasonal changes, sales promotions, <a href=\"https:\/\/www.shipbob.com\/blog\/seasonal-demand\/\">holiday sales<\/a>, <a href=\"https:\/\/www.shipbob.com\/blog\/how-to-run-an-e-commerce-flash-sale\/\">flash sales<\/a>, or as part of clearance events. For example, If a retailer doesn\u2019t properly <a href=\"https:\/\/www.shipbob.com\/blog\/demand-forecasting\/\">forecast demand<\/a> and orders too many outdoor grills in the summer, they may need to mark down prices in the fall to encourage sales and clear out remaining inventory.<\/p>\n\n\n\n<p>Doing this helps reduce <a href=\"https:\/\/www.shipbob.com\/inventory-kpis\/holding-costs\/\">holding costs<\/a> and frees up cash for the retailer to purchase new, more season-appropriate products.<\/p>\n\n\n\n<p>Markdowns also help encourage impulse purchases. Even if a business loses money acquiring a new customer, they have the opportunity to generate <a href=\"https:\/\/www.shipbob.com\/blog\/brand-lifetime-value-customer-taylor-holiday\/\">long-term value<\/a> from that customer through repeat purchases in the future.&nbsp;<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-retail-markdown-strategies-for-the-modern-world\">Retail markdown strategies for the modern world<\/h2>\n\n\n\n<p>Implementing an effective markdown strategy requires a combination of careful planning, market knowledge, and psychological insight into consumer behaviour. Retailers should consider the following strategies to maximise the potential benefits of markdowns while minimising the risks.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-monitor-your-sales-and-know-your-inventory\">Monitor your sales and know your inventory<\/h3>\n\n\n\n<p>Successful markdown management starts with a deep understanding of your sales data and <a href=\"https:\/\/www.shipbob.com\/blog\/inventory-levels\/\">inventory levels<\/a>. By regularly reviewing this information, retailers can identify trends, pinpoint underperforming products, and make informed decisions about when and how to implement markdowns.&nbsp;<\/p>\n\n\n\n<p>But keeping a close eye on your inventory levels isn\u2019t always easy. Especially when you\u2019re working with hundreds or even thousands of <a href=\"https:\/\/www.shipbob.com\/blog\/sku-analysis\/\">SKUs<\/a>.<\/p>\n\n\n\n<p>Black swan events like a <a href=\"https:\/\/www.shipbob.com\/blog\/ecommerce-covid-19\/\">global pandemic<\/a> can also throw a wrench in your <a href=\"https:\/\/www.shipbob.com\/inventory-management\/\">inventory management<\/a> plans. Let\u2019s say you sell hand sanitizer products and experienced a massive influx of new customers during the pandemic. Naturally, you\u2019d want to order a lot of inventory to satisfy that demand, however, properly monitoring your sales and inventory levels is of utmost importance during these times.<\/p>\n\n\n\n<p>If you\u2019re not careful, you could be left with vast amounts of unsold inventory once the demand for your product dries up, as was the case with hand sanitizer.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img loading=\"lazy\" decoding=\"async\" height=\"401\" width=\"700\" src=\"https:\/\/www.shipbob.com\/uk\/wp-content\/uploads\/sites\/32\/2023\/05\/78805a221a988e79ef3f42d7c5bfd418-4-700x401.png?w=1280px\" alt=\"\" class=\"wp-image-8438\" data-responsive-img srcset=\"https:\/\/www.shipbob.com\/uk\/wp-content\/uploads\/sites\/32\/2023\/05\/78805a221a988e79ef3f42d7c5bfd418-4-700x401.png?w=700px 650w, https:\/\/www.shipbob.com\/uk\/wp-content\/uploads\/sites\/32\/2023\/05\/78805a221a988e79ef3f42d7c5bfd418-4-700x401.png?w=860px 768w, https:\/\/www.shipbob.com\/uk\/wp-content\/uploads\/sites\/32\/2023\/05\/78805a221a988e79ef3f42d7c5bfd418-4-700x401.png?w=1180px 1080w, https:\/\/www.shipbob.com\/uk\/wp-content\/uploads\/sites\/32\/2023\/05\/78805a221a988e79ef3f42d7c5bfd418-4-700x401.png?w=1400px 1280w, https:\/\/www.shipbob.com\/uk\/wp-content\/uploads\/sites\/32\/2023\/05\/78805a221a988e79ef3f42d7c5bfd418-4-700x401.png?w=1600px 1440w\" fetchpriority=\"low\" \/><\/figure>\n\n\n\n<p>Should you find yourself in this scenario, applying a markdown percentage to your unsold inventory to encourage <a href=\"https:\/\/www.shipbob.com\/blog\/sell-through-rate\/\">sell-through<\/a> may be a good option.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-make-markdown-pricing-part-of-your-product-lifecycle-strategy\">Make markdown pricing part of your product lifecycle strategy<\/h3>\n\n\n\n<p>By understanding the various stages of a product&#8217;s life, from introduction to growth, maturity, and decline, retailers can better plan markdowns.&nbsp;<\/p>\n\n\n\n<p>Incorporating markdown pricing into your product lifecycle strategy provides retailers with an extended period of increased sales as a product begins to mature or decline.<\/p>\n\n\n\n<p>Keeping a close eye on your sales data is vital to properly implementing markdown pricing during a product\u2019s maturity stage. As sales begin to plateau or fall, this may signal an opportunity to introduce markdowns if lots of inventory remains in storage.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-avoid-mass-markdown\">Avoid mass markdown<\/h3>\n\n\n\n<p>Resorting to frequent, large-scale markdowns can send a message to customers that your products are always on sale, potentially undermining the perceived value of your brand.&nbsp;<\/p>\n\n\n\n<p>Instead of implementing mass markdowns, consider a more targeted approach based on specific products, customer segments, or seasons. This can help you maintain your brand&#8217;s image while still capitalising on the benefits of markdowns.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-think-ahead-and-pay-attention-to-your-retail-calendar\">Think ahead and pay attention to your retail calendar<\/h3>\n\n\n\n<p>Part of markdown optimisation is about aligning your pricing strategy with key events in your retail calendar. This includes things like:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Beginning\/end of season sales<\/li>\n\n\n\n<li>Holidays<\/li>\n\n\n\n<li>Nationally or globally recognised sales events<\/li>\n<\/ul>\n\n\n\n<p>Take Black Friday and Cyber Monday for instance. According to <a href=\"https:\/\/news.adobe.com\/news\/news-details\/2022\/Adobe-Cyber-Monday-Drove-11.3-Billion-in-Online-Spending-Breaking-E-Commerce-Record--\/default.aspx\">Adobe Analytics<\/a>, in 2022, US shoppers spent 35.3 billion, up 4% year over year.<\/p>\n\n\n\n<p>Planning your markdowns around nationally recognised sales events not only allows you to benefit from heightened consumer demand but also helps you stay competitive.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-learn-from-your-experience-with-markdowns\">Learn from your experience with markdowns<\/h3>\n\n\n\n<p>Evaluating the effectiveness of past markdowns can provide insights that help you refine your strategy and improve future results.<\/p>\n\n\n\n<p>Ask yourself questions like:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Did markdowns tied to a specific holiday perform better than just random sales?&nbsp;<\/li>\n\n\n\n<li>Did an early markdown campaign perform better than a late one?<\/li>\n\n\n\n<li>Did the use of psychological triggers alongside markdowns increase overall sales?<\/li>\n<\/ul>\n\n\n\n<p>Study everything from your email, <a href=\"https:\/\/www.shipbob.com\/blog\/sms-marketing-ecommerce\/\">SMS<\/a>, and ad campaign performance to identify what really moved the needle.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-it-s-all-psychological\">It&#8217;s all psychological<\/h3>\n\n\n\n<p>Markdowns can trigger psychological responses in customers, such as the perception of a deal or the fear of missing out. But besides just lowering the price of an item, retailers can also leverage other strategies to tap into these psychological responses.&nbsp;<\/p>\n\n\n\n<p>Some examples include:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><strong>Create urgency:<\/strong> Use limited-quantity sales to motivate shoppers to buy sooner, leveraging their FOMO and encouraging quicker purchasing decisions.<\/li>\n\n\n\n<li><strong>Avoid predictable sale patterns:<\/strong> Keep consumers engaged by offering varied, sporadic markdown sales throughout the year. This prevents them from waiting for a predictable weekly promotion to make a purchase.<\/li>\n\n\n\n<li><strong>Additional promotions:<\/strong> Utilise various <a href=\"https:\/\/www.shipbob.com\/blog\/5-types-promotions-e-commerce-stores\/\">promotions<\/a> alongside markdowns like <a href=\"https:\/\/www.shipbob.com\/blog\/how-to-offer-free-shipping-ecommerce-store\/\">free shipping<\/a>, free gift with purchase, and BOGO sales to achieve specific goals.<\/li>\n\n\n\n<li><strong>Use psychological triggers:<\/strong> Experiment with phrasing, like &#8220;get $X off&#8221; vs. &#8220;save $X,&#8221; and even consider dropping currency symbols to avoid reminding customers of the cost.<\/li>\n\n\n\n<li><strong>Leverage charm pricing:<\/strong> Utilise prices ending in nine, such as $9.99 or $19.99, which often outsell lower prices.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-the-costly-downsides-of-markdowns-in-retail-and-ecommerce\">The costly downsides of markdowns in retail and ecommerce<\/h2>\n\n\n\n<p>There are various benefits to offering markdowns but there are also obstacles. Marking down items comes with its own set of challenges that may impact multiple areas of your business.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-time-consuming\">Time-consuming<\/h3>\n\n\n\n<p>Constantly running new campaigns to get rid of excess products may not be the best use of your time. It involves continuously adjusting pricing, updating marketing materials, and communicating the changes to your customers.<\/p>\n\n\n\n<p>Your and your team&#8217;s time may be better used exploring other ways to move your product. <\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-tarnishing-brand-perception\">Tarnishing brand perception<\/h3>\n\n\n\n<p>As previously mentioned, frequent markdowns can lead to a decrease in the perceived value of a retailer&#8217;s brand.&nbsp;<\/p>\n\n\n\n<p>Customers may come to expect regular sales and be less willing to purchase items at their full price, potentially harming the retailer&#8217;s long-term profitability and image.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-reduced-profit-margins\">Reduced profit margins<\/h3>\n\n\n\n<p>Relying too heavily on markdowns to drive sales can negatively impact a retailer&#8217;s <a href=\"https:\/\/www.shipbob.com\/blog\/average-revenue-per-unit\/\">average revenue per unit<\/a>.&nbsp;<\/p>\n\n\n\n<p>The retail sector already operates on slim margins. <a href=\"https:\/\/www2.deloitte.com\/content\/dam\/Deloitte\/at\/Documents\/about-deloitte\/global-powers-of-retailing-2018.pdf\">Deloitte<\/a> found the average net profit margin for the top 250 retail companies was a mere 3.2%.<\/p>\n\n\n\n<p>There\u2019s also a lot more that goes into the calculation of your <a href=\"https:\/\/www.shipbob.com\/blog\/cost-per-unit\/\">cost per unit<\/a> than just your product cost. Therefore, if you\u2019re not careful, your marked down items could be selling at a loss once you factor in all of the variable and fixed costs.<\/p>\n\n\n\n<h3 class=\"wp-block-heading\" id=\"h-symptom-of-a-larger-problem\">Symptom of a larger problem<\/h3>\n\n\n\n<p>Frequent markdowns can be a sign of deeper issues within a retail business.&nbsp;<\/p>\n\n\n\n<p>If your business is frequently promoting markdowns, you may benefit from an <a href=\"https:\/\/www.shipbob.com\/blog\/inventory-audit\/\">inventory audit<\/a>. These can be used to identify if <a href=\"https:\/\/www.shipbob.com\/blog\/sku-rationalization\/\">SKU rationalization<\/a> is required or if more attention should be put into your <a href=\"https:\/\/www.shipbob.com\/blog\/restocking-inventory\/\">inventory restocking<\/a> plan.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-reduce-markdowns-with-inventory-management\">Reduce markdowns with inventory management<\/h2>\n\n\n\n<p>ShipBob helps retailers optimise their inventory by providing real-time data, demand forecasting, and <a href=\"https:\/\/www.shipbob.com\/blog\/order-management\/\">order management<\/a> tools.<\/p>\n\n\n\n<p>By leveraging the expertise and resources of a 3PL, businesses can better plan their inventory levels, reduce overstocking, and ultimately minimise the need for markdown campaigns.<\/p>\n\n\n\n<p>For instance, ShipBob&#8217;s platform allows businesses to calculate important <a href=\"https:\/\/www.shipbob.com\/inventory-kpis\/\">inventory management KPIs<\/a> like the <a href=\"https:\/\/www.shipbob.com\/inventory-kpis\/inventory-turnover-ratio\/\">inventory turnover ratio<\/a>. This metric shows how many times inventory is sold and replaced within a specific time period. It provides insights into how well products are moving so that you can purchase the right amount of stock.<\/p>\n\n\n\n<p>Furthermore, ShipBob\u2019s analytics tool can help you determine <a href=\"https:\/\/www.shipbob.com\/blog\/new-free-analytics-reporting-tool\/\">stock availability<\/a>, forecasted demand, inventory performance, and much more.<\/p>\n\n\n\n<p>Having access to a <a href=\"https:\/\/www.shipbob.com\/inventory-management\/real-time\/\">real-time inventory management<\/a> platform provides retailers with the data they need to avoid purchasing too much inventory and then having to markdown prices to offset potentially even greater losses.<\/p>\n\n\n\n<p>Although markdowns may sometimes be necessary, effectively managing your inventory can significantly reduce the need for them. The goal should always be to maintain optimal inventory levels, healthy profit margins, and focus on growth strategies that drive long-term success.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-get-started-with-shipbob\">Get started with ShipBob <\/h2>\n\n\n\n<p>Ready to outsource your B2B fulfilment and are interested in learning more about ShipBob&#8217;s platform? Connect with our team to get started. <\/p>\n\n\n\n<div class=\"wp-block-buttons is-content-justification-center is-layout-flex wp-container-core-buttons-is-layout-16018d1d wp-block-buttons-is-layout-flex\">\n<div class=\"wp-block-button\"><a class=\"wp-block-button__link wp-element-button\" href=\"https:\/\/www.shipbob.com\/b2b-quote\/\" target=\"_blank\" rel=\"noreferrer noopener\">Request a quote<\/a><\/div>\n<\/div>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-markdown-in-retail-faqs\">Markdown in retail FAQs<\/h2>\n\n\n\n<p>Here are answers to some of the most common questions about markdowns in retail:<\/p>\n\n\n\n<div class=\"wp-block-shipbob-blocks-single-faq single-faq direction-col\" data-controller=\"faq-controller\" data-faq-controller-open-value=\"true\"><div class=\"single-faq-title-contianer\"><h4 class=\"single-faq-title\">What is an example of markups and markdowns in retail?<\/h4><div class=\"single-faq-expand\" data-faq-controller-target=\"expand\"><img decoding=\"async\" src=\"\/wp-content\/themes\/shipbob-2022\/resources\/svg\/plus-solid.svg\"><\/div><\/div><div class=\"single-faq-childs\" data-faq-controller-target=\"answer\"><div>\n\n<p>A markup is an amount added to the cost of a product to determine its selling price. For example, if a retailer buys a product for $10 and wants to achieve a 50% markup, they would sell the product for $15. A markdown, on the other hand, is a reduction in the original selling price. For example, if a product sold for $15 and received a 25% markdown that would reduce its price to $11.25.<\/p>\n\n<\/div><\/div><\/div>\n\n\n\n<div class=\"wp-block-shipbob-blocks-single-faq single-faq direction-col\" data-controller=\"faq-controller\" data-faq-controller-open-value=\"true\"><div class=\"single-faq-title-contianer\"><h4 class=\"single-faq-title\">What are some disadvantages of retail markdowns?<\/h4><div class=\"single-faq-expand\" data-faq-controller-target=\"expand\"><img decoding=\"async\" src=\"\/wp-content\/themes\/shipbob-2022\/resources\/svg\/plus-solid.svg\"><\/div><\/div><div class=\"single-faq-childs\" data-faq-controller-target=\"answer\"><div>\n\n<p>Some disadvantages of retail markdowns include reduced profit margins, brand image erosion, and inventory management challenges. Additionally, frequent markdowns can condition customers to simply wait for the next sale thus reducing full-priced sales revenue.<\/p>\n\n<\/div><\/div><\/div>\n\n\n\n<div class=\"wp-block-shipbob-blocks-single-faq single-faq direction-col\" data-controller=\"faq-controller\" data-faq-controller-open-value=\"true\"><div class=\"single-faq-title-contianer\"><h4 class=\"single-faq-title\">How can businesses avoid markdowns?<\/h4><div class=\"single-faq-expand\" data-faq-controller-target=\"expand\"><img decoding=\"async\" src=\"\/wp-content\/themes\/shipbob-2022\/resources\/svg\/plus-solid.svg\"><\/div><\/div><div class=\"single-faq-childs\" data-faq-controller-target=\"answer\"><div>\n\n<p>To avoid markdowns, businesses can focus on improving their inventory management practices, accurately forecasting demand, and aligning their product offerings with customer preferences. By partnering with an established third-party logistics provider, retailers can gain access to valuable data that help them optimise inventory levels and reduce the need for markdowns.<\/p>\n\n<\/div><\/div><\/div>\n\n\n\n<div class=\"wp-block-shipbob-blocks-single-faq single-faq direction-col\" data-controller=\"faq-controller\" data-faq-controller-open-value=\"true\"><div class=\"single-faq-title-contianer\"><h4 class=\"single-faq-title\">What is the difference between discounts and markdowns?<\/h4><div class=\"single-faq-expand\" data-faq-controller-target=\"expand\"><img decoding=\"async\" src=\"\/wp-content\/themes\/shipbob-2022\/resources\/svg\/plus-solid.svg\"><\/div><\/div><div class=\"single-faq-childs\" data-faq-controller-target=\"answer\"><div>\n\n<p>Discounts are usually more temporary in nature and offered to incentivize customers, increase foot traffic, promote sales, or reward specific groups of people (i.e. students, military personnel, or loyalty program members). Markdowns are permanent reductions used to clear slow-moving or excess inventory, make room for new merchandise, or liquidate seasonal items.<\/p>\n\n<\/div><\/div><\/div>\n","protected":false},"excerpt":{"rendered":"<p>Learn more about retail markdowns, when they&#8217;re needed, and how to do them well in this blog.<\/p>\n","protected":false},"author":193,"featured_media":8437,"parent":0,"template":"","meta":{"content-type":"","inline_featured_image":false,"footnotes":""},"blogcategories":[6],"class_list":["post-8435","blog","type-blog","status-publish","has-post-thumbnail","hentry","blogcategories-ecommerce-tips"],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium plugin v27.5 (Yoast SEO v27.5) - https:\/\/yoast.com\/product\/yoast-seo-premium-wordpress\/ -->\n<title>Retail Markdowns: Basics + Winning Strategies for 2025<\/title>\n<meta name=\"description\" content=\"Learn more about the benefits and challenges that come with marking down items in your ecommerce 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