Consignment Markdown Planner · guide
Short answer: mark an item down when the extra chance of selling it this week is worth more than the cut you give up and the shelf week you save. A fixed schedule gets close; working it per item gets closer, and also tells you which items were never worth the slot.
A designer silk blazer is tagged at $120. It sells about 8% of weeks at full price, you keep 40% of the sale, a rack slot costs $0.60 a week, handling is $2, and the item stays 12 weeks. Each 10% off lifts the weekly sell chance by 35% of its base rate.
The gain per item is small; across a floor of hundreds of items it is the difference between a rack that turns and one that fills with last season.
A $12 graphic tee that sells 10% of weeks, with a 40% shop share and the same $0.60 slot, nets -$1.63 even on its best schedule (25% off from week 1, 40% off from week 6). It would only pay at a price of about $17.93 or a shop share near 59.8%. Tell consignors that items under that price are not accepted, or take them at a higher split.
Check the consignment agreement first: some promise consignors a markdown schedule or price floor, and those terms come before any optimum.
There is no fixed answer; it depends on how fast items like it sell and what a week of shelf space costs you. Items that sell quickly at full price can hold their tag longer. Items on a costly slot or with a slow sell rate pay to start marking down early. The planner finds the best start week for each item from your own numbers.
It is a sensible default and rarely a disaster, but it treats every item the same. The planner compares it with the best schedule for each item and prints the dollars the fixed rule leaves behind.
Items whose expected shop cut, over the weeks they are likely to sit, does not cover shelf space and handling. Low-ticket items on a costly shelf are the usual losers. The planner names the price or shop share at which each declined item would pay.