UPTO ...70%......60%.....50%.......

What this discount means ?

On Saturday 11 August I happen to glance the supplement of mumbai's leading newspaper. I have an interesting observation to share with. The publication carried more than 11 advertisement in descent sizes which just had headline UPTO... and the discount offering. Most of these ads were in area of textiles, fashion , footwear and ready to wear shirts. The announcement of sale to me is also the beginning of festival season. Most of the brands were using the Upto 60%... scheme as this is connected with the 60 years of India's Independence. This is type of discounting is the most easiest way to deplete your stocks. The logistics is very simple and also from the communication point of view the press ads are idiot proof. Most brands and retailers offer these discounts for various reasons. But the customer has certain myths on such discounts.

The Customer Myths :
a. Am I getting a defective quality
b. Are these old stocks with outdated designs
c. Is it a export surplus
d. My choice would be limited in terms of selection
e. Is there any warranty if the goods are defective
f. Is the brand or company shutting operations
g. Is it original or duplicate

The Reality :
I did speak to a a few retailers to find out the actual truth of such sale. The first thing I was told that these are genuine discounts and there is no suspect on the quality aspect. Some of the reasons that were stated for the sale were as follows :
- Excess stocks of a particular fashion and since in the textile and ready to wear markets style and fashion often change they would like to dispose of the stocks so that they are able to stock new designs and products. Depleting the stocks will also help in getting sufficient working capital to run their business.
-Since India has different climatic conditions they have to stock goods accordingly. For eg... before the onset of winter they need to push the half shirts as people would go for full sleeve shirts for the winter and to stock the full sleeve shirts they need bring the stock position down.
- In some case certain colours do not sell and these gets accumulated but to get this out of stock the retailers and brand owners have no option but to give huge price offs.

Observation and Findings :
- This is a annual trend to deplete stocks. Such sales are very common in the US and west.
- Some smart consumer take this opportunity to buy a lot and stock for the festival time
- The sale bonanza is week end fever
- The retailers use only mainline dailies to create awareness and get response.
- The publication has heavy traffic and it is therefore important to take big ads.
- The offers last for about 3 to 4 weeks. Otherwise it may effect the health of the brand.


V.GANAPATHY