How does sell-through affect markdown timing?

Sell-through sets the clock. Divide remaining units by current weekly units to get weeks of supply; compare that with the weeks left before the season exit date. When weeks of supply exceeds weeks remaining, the current price will not clear the stock and the next break should move earlier, not deeper.

How do you calculate weekly sell-through in retail?

Weekly sell-through is units sold in the week divided by units available at the start of that week, expressed as a percentage. Because the denominator is the stock still on hand, the same weekly units produce a rising sell-through percentage as inventory depletes — which is why plans built on remaining-stock rates behave differently from plans built on original-stock rates.

What sell-through target should trigger a markdown?

Use a pace target rather than an absolute one: the cumulative sell-through your plan expected by that season week. Falling a few points behind for two consecutive weeks is a signal; one soft week driven by weather or a shipping delay is not. The absolute number that matters is weeks of supply against weeks remaining.

How much does a markdown lift sell-through?

It varies by category, price point, and how close the season is to ending, so the honest answer is that your own history is the only reliable source. What is consistent is the shape: the first modest break usually produces the best lift per margin point given up, and very deep late breaks buy less velocity than their depth suggests because the remaining assortment is broken.

What is the relationship between sell-through and margin?

They trade against each other. Every point of extra sell-through bought with price comes out of maintained margin, and it comes out of every unit sold at that price — not just the marginal ones. The plan worth choosing is the one that hits your ending-stock target with the least margin given away in the slow case.

Why model sell-through per price period instead of one rate?

A single rate assumes price does not change behaviour, which defeats the purpose of a markdown plan. Full price is the slowest period; each break should raise the rate. Setting the rate per period is what makes the projected ending stock and maintained margin worth reading.

Sell-through rate and markdown strategy

Markdown timing is a velocity problem before it is a pricing problem. Weekly sell-through tells you how many weeks of supply you are carrying; the season exit date tells you how many weeks you have. When the first number exceeds the second, price has to change — and how much it has to change depends on the lift each depth has historically produced.

Set sell-through per price period When to mark down inventory

Weeks of supply is the trigger, not the sell-through percentage

Weekly sell-through = units sold this week ÷ units on hand at the start of the week. Weeks of supply = remaining units ÷ current weekly units. That second figure is the one to compare against the weeks left in the season, because it already accounts for how much inventory you are still holding.

The table below runs the same 676 remaining units at four different weekly rates against a 10-week runway. Notice that the decision flips on velocity alone — nothing about cost, ticket price, or competitor pricing has changed.

Weeks of supply against a 10-week runway (676 units remaining)

Weekly sell-through	Units on hand	Units / week	Weeks of supply	Weeks left	Read
12%	676	81	8.3 wks	10 wks	On pace — hold
8%	676	54	12.5 wks	10 wks	Behind — pull the break forward
5%	676	34	20.0 wks	10 wks	Badly behind — break now and deeper
16%	676	108	6.3 wks	10 wks	Ahead — delay or soften the break

Building the assumption

How to set a sell-through rate for each price period

The planner asks for a weekly rate per price period. These are the sources worth using, in order of reliability.

Last season, same class

Best source

Pull weekly units at each discount depth from the comparable season and convert to a percentage of stock on hand at that time. Imperfect history beats a confident guess.

The current full-price rate

Your anchor

You already know this week's rate. Use it for the full-price period, then apply the lift ratios you observed historically at each depth rather than inventing new absolute numbers.

A wide sensitivity spread

When history is thin

New class, new channel, or no comparable season: widen the spread so the slow case is genuinely pessimistic, and judge the plan on that case rather than the midpoint.

Sell-through versus margin: the trade you are actually making

Buying velocity with price is not free and it is not marginal — the reduction applies to every unit sold at that ticket, including the ones that would have sold anyway. That is why a modest early break often outperforms a deep late one: it runs a smaller reduction across more weeks of remaining demand, instead of a huge reduction across a broken assortment in the final fortnight.

The way to settle the argument is to model both cadences with honest per-period rates and compare maintained margin at the same ending-stock outcome. If two plans both hit the target, the cheaper one wins; if only one hits it in the slow case, that is the plan.

Keep planning

Model your markdown schedule
Every price period carries its own editable sell-through rate, with a slow / planned / fast band.
When to mark down inventory
Turning these velocity signals into a decision date.
Retail markdown strategy
Cadence shapes and how depth and timing interact across a full season.
Maintained markup calculator
Price the margin cost of the velocity you are buying.

Answers

Sell-through and markdown questions

Turn your weekly rates into a season outcome

Enter a sell-through assumption per price period and see ending stock, cash recovered, and maintained margin as a range rather than a single number.

Open the markdown planner