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Strategic Overview
proFILE is the latest software tool developed by Atlantec Software for retailers. It allows retailers to plan their markdown sales carefully by simulating the effects of different markdown policies on the resulting revenues and levels of stock. By analysing the results of different markdown policies and then implementing the 'best' policy, the business objectives of the markdown can be realised.
The Problem
Retailers have markdown sales for many reasons. Two of the most common reasons are that firstly unwanted stock can be cleared and secondly that people who had never previously shopped there may be tempted inside by good offers. A valuable consequential benefit of markdown sales is that some of these people may be so impressed by the shop and its products that they become regular customers.
The pricing policy for the marked down goods has a major effect on the overall revenue during the sale and the success in clearing the unwanted stock - the easiest way of clearing stock is to 'give it away' but the financial implications of this approach are significant and may affect the overall financial performance of the retailer. Therefore, the challenge for retailers is to price the marked down goods in such a way that they are all sold and that the markdown sale revenue is maximised.
The Solution
To help retailers adopt pricing policies in which both these objectives are met, Atlantec Software has developed the software tool proFILE.
proFILE works at product level so that a particular pricing policy can be adopted for each product. The policies adopted depend on the products' characteristics and their sales patterns. The dynamic nature of the markdown pricing model in proFILE considers how much was sold during each previous period and the markdown during each of these periods. Furthermore, the actual pricing policy can be changed during the sale to consider what has already happened during the sale.
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