Markdown
A permanent or temporary reduction in the retail selling price of a product, typically used to clear slow-moving or end-of-season inventory.
Full Definition
In retail analytics, a markdown refers to a deliberate downward adjustment to a product's selling price, distinguished from a promotional discount in that markdowns are generally permanent or semi-permanent rather than time-limited. Markdown optimization analytics model the optimal timing, depth, and cadence of price reductions to maximise total revenue recovery on clearance inventory. Markdown rates are a key profitability KPI, particularly in fashion and seasonal retail. Editors must distinguish 'markdown' (permanent price reduction) from 'promotional price' or 'temporary price reduction (TPR),' which are time-bounded and later reversed.
Usage
Usage note: Write as one word ('markdown') as a noun and adjective. Do not hyphenate. The opposite term 'mark-up' or 'markup' varies by house style; confirm and apply consistently.
In Context
- "The markdown analytics model recommended a 25% price reduction on unsold winter coats from week 8 of the clearance period." — Merchandising analytics report
- "Total markdown spend as a percentage of net sales reached 8.3% in Q1, exceeding the 7% budget threshold." — Financial performance dashboard