General Retail Business Issues/retail pricing

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Question
Hi James,
I have a small retail store front that sells wine and beer making supplies.
Assuming the customer is going to pay the same retail price, is it better to mark it up and offer say a 10% discount and mention it at cash-out, or just leave the price where it should be?
My thought is, at check-out the customer might appreciate me giving them a 10% discount. Then again on the other hand, Iím afraid people wonít buy when they see a high price for the product on the shelf.
Could you give me your opinion and thoughts?
Thank you,
Randy

Answer
Randy,
Good question. You correctly identified the problem with raising a price on the shelf to then be able to discount it at the register. The customer may see your higher price and never make it to the register and just leave while telling themselves that your prices are too high. When someone brings something to the register it means that they have already decided to pay the price that is marked and to give a discount at this point is some what pointless. You would be better served to give them a small gift which will buy more loyalty than a fake 10% discount. So, find some small item, maybe a cool refrigerator magnet with your store name on a beer barrel, or a pen, or something that they did not expect and that will be far more memorable than a small discount. Also, remember the best gift of all, look them in the eye and say thank you and tell them how much you appreciate their trust and business.

General Retail Business Issues

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James E. Dion

Expertise

Most questions about trends in specialty retail, how customers are changing both in the US and Europe. Demographics for all countries as they relate to retail trends and issues. Store Operations, Buying and Merchandising.

Experience

Over 40 years in the retail industry, store level, store manager, buyer, merchandise manager, Vice President.

Education/Credentials
BS Psychology, MS Psychology, PhD(abd) Industrial Psychology Illinois Institute of Technology

Past/Present Clients
Microsoft, Harley-Davidson, Ritz-Carlton, Hummer, Williams-Sonoma, Ace Hardware, Coleman Spas, Aldo, Intel, Dell, Safeway, New Balance, IBM, Kodak, Bata International, Nortel Networks, Honey Baked Ham Co., Man Alive, Highsmith
B.S Chicago State University M.S. Chicago State University PhD (abd) Illinois Institute of Technology

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