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Planned markdown calculator

Too many small businesses use a very simple plan in determining the margins of their merchandise. They simply look at the cost and then apply a multiplier factor to the cost to determine the selling price.

As the merchandise ages, they begin to randomly take markdowns in an effort to get rid of the merchandise. If the buyer were to calculate the maintained gross margin when all of the merchandise has been sold, they would likely be surprised at what their margin was. The surprise may be how high of a margin they maintained as well as it could be a surprise as to how low it was; but either way, in most cases they are surprised.

This calculator is created to resolve that. Sophisticated buyers do not settle for looking at their initial margin; they have a plan as to when, with how many on hand, and by how much to mark merchandise down. This is exactly how this calculator works. It allows you to plan for four markdowns over the season of an item. By determining how long the merchandise will be sold at full price, you will then decide when, how many, and by how much the merchandise will be discounted.

Proceed with this calculation for up to four periods, and this calculator will tell you what your maintained margin will be for the entire season of the product. This is a much better way than just guessing as you go through the season, and it is likely that you will end the season with less of the inventory on hand, and with fewer markdowns.

Planned markdown calculator from Profits Plus
       
Yellow indicates squares where info is entered      
       
Inventory Purchase Amount    
Inventory Balance Remaining @ End of Period 1    
Inventory Balance Remaining @ End of Period 2    
Inventory Balance Remaining @ End of Period 3    
Inventory Balance Remaining @ End of Period 4    
       
       
Inventory Sold During Period 1    
Inventory Sold During Period 2    
Inventory Sold During Period 3    
Inventory Sold During Period 4    
       
       
Gross Margin % (original)    
       
       
Discount (% of Retail) Offered in Period 1    
Discount (% of Retail) Offered in Period 2    
Discount (% of Retail) Offered in Period 3    
Discount (% of Retail) Offered in Period 4    
       
       
Gross Margin % (Net of Discount) in Period 1    
Gross Margin % (Net of Discount) in Period 2    
Gross Margin % (Net of Discount) in Period 3    
Gross Margin % (Net of Discount) in Period 4    
       
       
Sales in Period 1 (before discount)    
Sales in Period 2 (before discount)    
Sales in Period 3 (before discount)    
Sales in Period 4 (before discount)    
TOTAL Sales    
       
Sales in Period 1 (net of discount)    
Sales in Period 2 (net of discount)    
Sales in Period 3 (net of discount)    
Sales in Period 4 (net of discount)    
TOTAL Sales    
       
Amount of Discount in Period 1    
Amount of Discount in Period 2    
Amount of Discount in Period 3    
Amount of Discount in Period 4    
TOTAL Amount of Discount    
       
Gross Margin Dollars in Period 1    
Gross Margin Dollars in Period 2    
Gross Margin Dollars in Period 3    
Gross Margin Dollars in Period 4    
TOTAL Gross Margin Dollars    
       
TOTAL Gross Margin % (based on retail)    
TOTAL Discount % (based on retail)    
       
       
Check total for period 1    
Check total for period 2    
Check total for period 3    
Check total for period 4    
       
       
       

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©1998-2026 Profits Plus Solutions, Inc.
Tom Shay
PO Box 128
Dardanelle, AR 72834
(727)823-7205

SEPTEMBER 2026
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Small Business

AdvisoriES


Our September advisory is titled, "What do you sell?" My favorite example of someone getting it wrong has an email that starts with, "Sallysellsinsurance@."

 

Yes, that may be the product that Sally sells, but what she is really selling is peace of mind in knowing that if something happens, you are not going to pay the entire cost of the loss.

 

This is but one example. Our September advisory - What do you sell?

Small Business

NewS

Top Story

Yes, selling does include translating features into benefits. But it does not stop there. What if the benefit is not relevant to the customer? Then, there might not be a sale. This is where advantage comes into consideration, and that is our top story of the month.

Article of the Month

When you think about a customer who makes a point to talk to you and your staff, have you ever thought about getting them to talk about your business with their friends? The September Article of the Month shares an idea.


Book of the Month

The Art of the Exit is our suggested book of the month. The author, Jackb Orosz, discusses ways of getting out of your business whether it is retiring or just time to move onto something else.

All this plus the Internet Tool for Your Business and a staff incentive idea for your business.
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BOOK US

With over 25 years of frontline experience Tom Shay is America's leading Small Business Management Expert. He's a "Must Have" for your next event.

Small Business

Advisories

Our September advisory is titled, "What do you sell?" My favorite example of someone getting it wrong has an email that starts with, "Sallysellsinsurance@."

 

Yes, that may be the product that Sally sells, but what she is really selling is peace of mind in knowing that if something happens, you are not going to pay the entire cost of the loss.

 

This is but one example. Our September advisory - What do you sell?

Small Business

News

 

Top Story

Yes, selling does include translating features into benefits. But it does not stop there. What if the benefit is not relevant to the customer? Then, there might not be a sale. This is where advantage comes into consideration, and that is our top story of the month.


Article of the Month

When you think about a customer who makes a point to talk to you and your staff, have you ever thought about getting them to talk about your business with their friends? The September Article of the Month shares an idea.


Book of the Month

The Art of the Exit is our suggested book of the month. The author, Jackb Orosz, discusses ways of getting out of your business whether it is retiring or just time to move onto something else.

 

All this plus the Internet Tool for Your Business and a staff incentive idea for your business.