Case study
New markdown solution enables a national retailer to substantially reduce waste
Client
Leading multinational retailer
Competitors
Amazon, Costco, Kroger
A leading retailer needed a consistent, accurate method of marking down end-of-life grocery items. So, they partnered with Retail Insight to create a new approach – one that leverages their data to deliver the most effective markdown prices.
Find out how they saved millions in base waste costs with an analytical and dynamic markdown solution.
Retail Insight Solutions
Takeaways
£40m
savings
A leading national retailer needed to update their decade-old process for marking down end-of-life grocery items, as they could no longer accurately monitor waste and costs were rising.
They applied the same discount to all items, regardless of time, day, category, or stock level. There was no consistent process across the store estate. Many store managers developed their own, often inefficient approaches independent of head office guidance.
As a trusted partner, we developed a new markdown solution that leverages historically available markdown data, that the retailer was not using due to its unstructured nature. We modelled item level price and sales data to isolate the impacts of each historic markdown and the specific circumstances. This enabled us to build an accurate picture of what had previously worked and why.
We supported the analytical solution with simple store guidelines that delivered markdowns to handheld devices as part of the existing process. It also considered time of day in discount value. Once we achieved foundational consistency through compliance reporting, we evolved the product to utilize increasing data richness and store capability to become truly dynamic.
The closed data loop of item level reporting delivers insight to head office to inform ranging and forecasting decisions. This helps the client avoid store issues, while the living database continually enhances the recommendation engine.
The product has reduced base waste costs substantially, yet we continue to deliver incremental year-on-year benefits, cumulatively over £40m of the retail cost. Our efforts have also helped the client minimize their environmental impact. Even with a reduction in labor, we can deliver this through more efficient in-store processes.
£40m
saved in direct costs
The retailer has saved over £40m by partnering with Retail Insight.
Together, Retail Insight and the retailer built a new markdown solution that leverages historical markdown data.
The solution has reduced base waste costs substantially each year.
Item-level reporting delivers actionable insight to head office.
Book your Retail Execution Consultation to start your journey.