Aug 9, 2022
Retail Margins: Why marking down your ‘dogs’ will be a big win for gross profits and cash flow
This is the first in a series of educational articles designed to help independent retailers improve cash flow by managing inventory more efficiently. During hard economic times when customers are more likely to buy gas than clothing, it’s extremely important to manage cash. Cash flow is the lifeblood of any business, for independent retailers cash flow management can be the make or break. Geared towards Fashion retailers, this article can be applied to many brick-and-mortar businesses.
Retailers have high fixed costs such as rent, payroll, utility bills, and more. One thing that most people don’t take into account is that a large portion of your cash will be tied up in inventory, after all, you need a product to sell. Being a small business, you may not find many vendors who are willing to give you credit, and even when you get to that point, sometimes the 30 days of credit is not long enough to sell the product. Most times, you’ve been forced to lay out cash for a product befo…