Percentage of Inventory ON/OFF Promotion

For each category, you will also report what percentage of that category's overall inventory is on promotion. It's important to remember that Clearance inventory SHOULD count toward the overall % of inventory on promotion. The goal is to get an accurate estimate of the total inventory per category that is not being sold at full price. 

Now, you don't need to count all of the inventory in order to calculate the % of inventory on promotion. Instead, you should visually estimate how much of each category's total inventory you see on promotion.

For example, if you mentally placed all of the racks for Men's Dress Shirts together, how much of that total inventory would you estimate is on promotion? This is not an exact science, but rather more of a gut check for how much of the inventory feels like it is on some kind of sale. 

The best way to estimate the '% of Inventory ON/OFF Promotion' is to visually think of the store layout. We will provide more in-depth examples in the upcoming steps.

There are two instances where 100% of inventory would be reported as being on promotion

1. Category-wide sales - used when an entire category is facing the same discount. For example, all Sweaters are discounted by 25% after winter. 
2. Store-wide sales - it's rare, but sometimes H&M will have storewide sales. This means the ENTIRE store is facing the same discount. 

Previous Page: Effective Pricing

Next Page: Practicing Estimations