Many workers in the field of direct sales know what stocks are, not only in their profession, but also constantly face various sales and discounts on the territories entrusted to them or just when going to the store in their free time. At the same time, few people can be surprised by the fact that various discounts are constantly offered to various product segments, because such tools are used today in almost all types of trade.
Why are they being held?
It is quite natural that even those who are well aware of what a stock is, may not be aware of why such sales tools are used by sales outlets, and which of the latter make a profit.
The reason for the appearance of the action may be very different:
- The number of consumers has decreased. Over time, many outlets, due to the constant growth in the number of competitors or a decrease in demand from consumers, may lose customers, as a result of which they are trying to bring them back in a variety of ways. One of the most effective methods is the introduction of promotional prices for those goods that will actually be in demand, because the target audience needs them.
- The number of sales of a certain product has decreased. It is quite natural that there are certain product segments that lose their relevance over time. Clothing, appliances, household appliances - all this becomes obsolete over time, as more and more new technologies are constantly being developed. In this case, the older a particular product becomes, the less demand for it, and so it lasts until it disappears almost completely. What to do with a washing machine that has been in stock for several years? That's right, sell at a lower price.
- Demand does not exceed supply. Many products have a certain lifespan or shelf life, but having more ambitious plans or some other reasons, the company purchased too many such products, as a result of which there is a risk that it will remain in stock and you will have to write off. It is quite natural that a written off product does not make a profit in principle, therefore it is better to sell it and return at least some part of the invested funds. What are stocks in this case? A tool to get at least some profit.
Why do we need discounts?
Thus, considering what shares are for sellers, it is worth saying that this is an excellent tool for increasing sales, and only then - attracting consumers to a certain category of marketable products. The only thing that many people do not understand is for what reason does the company have the opportunity to make a significant discount to the initial cost? In other words, why sell the item cheaper if sometimes, on the assurances of the sellers themselves, even the receipt price is higher than the selling price?
Promotions from the seller’s point of view
First of all, let's discuss what shares are from the point of view of the implementer. This is a carefully planned event, which, with a competent attitude to marketing, is planned for about a quarter, while in federal chain stores such actions can be planned for more than one year.
At the same time, it is worth noting that the budget allocated for promotions and discounts, in the overwhelming majority of cases, is initially included in contracts drawn up with suppliers, which, in turn, will form preliminary budgets in accordance with their profits. Accordingly, the planning of pricing for various types of products is also carried out, and quite often discounts for some popular brands are initially included in the price of goods.
In other words, any promotions and discounts that you see on the shelves of various stores represent a carefully planned redistribution of funds, as well as various acquired goods, which are taken from some customers and then transferred to others.
What does this look like on an example?
Promotions in the stores are conducted approximately as follows: person A acquires one unit of a certain “premium” product, the margin of which is 100 rubles, thanks to which a couple network / supplier can subsequently provide a discount for three units of cheaper commodity products for 30 rubles each. It is worth noting that in this case the simplest mechanism for conducting such operations is considered, while there are much more interesting and subtle ways of organizing such events.
More serious schemes
Consider this example. A large store makes a serious discount on some products of a well-known brand and, at the same time, has taken care of correctly placing other products from adjacent groups, thanks to which it is able to acquire additional profits. This is due to the fact that consumers, who set the main task of purchasing goods at a discount, are starting to buy up a nearby range, as a result of which the stock price is completely covered by additional profits from the purchase of other products.
In principle, any marketing mechanisms based on lowering the prices of various goods are aimed precisely at stimulating impulse demand, while the discount itself is simply the point at which this “impulse” appears. Thus, a person wants to save money, but in the toga buys and spends an order of magnitude more, compared to the price before the discount, and the stock price for the store pays off.
Shops "long-term" products
In stores that are not engaged in the FMCG trade, but in the sale of durable goods, much more transparent mechanisms are used. In this case, the marketing model is entirely tied to the “artificial aging of the product,” that is, a change in model series or seasons. At the same time, the supplier must ensure a continuous production procedure, as a result of which more and more new types of products should be brought to the market.
Thus, if you see some furniture at a discount or a car “before restyling,” then you can be quite sure that such an offer will ultimately benefit not only the store, but you as well.
What is the benefit?
In this case, the shares in the stores are held exactly with the technology of mutually beneficial cooperation. If the store tries to somehow deceive consumers and as a result simply does not provide them with favorable conditions, as a result of which they will not buy this product, the products may become morally obsolete and turn into a "hanging sign" on the balance sheet of the enterprise, because in our age nobody wants buy “outdated” models, even if they have all the characteristics needed by the consumer, and they themselves are in perfect condition.
It is worth noting the fact that it is on the “artificial aging of the product”, as well as the targeted updating of certain of its characteristics, that Apple’s marketing is fully built. Many may notice this by the fact that the owners of the latest iPhone model at the moment, which is almost as good as any other phone in terms of their functionality, still buy new devices from Apple, forming long queues in the first days of sales.
Is it possible to earn?
Of course, you can make money on durable goods like cars, furniture or large household appliances. Many have noticed shares of St. Petersburg and other cities, when consumer lending, the sale of certain accessories, insurance, or the provision of additional services that bring the company ultimately additional profit are carried out with the goods. Among other things, in this case, the outlet gets the target audience initially set up to buy, as people are inspired by discounts, and it will not be difficult to push them to make various impulse purchases. It is worth noting that it is in this way that actions are held in most large cities (Moscow is no exception). In this regard, if you are a buyer, weigh the pros and cons in advance, or better yet, find out the price of the goods in advance before the action.
Shares in banks
Also, many people noticed which shares were held by various banks, announcing small interest on the loan, but at the same time obliging the client to issue life insurance to receive it. And on insurance, credit institutions earn about three or even five times more than a professional insurance company, in which a person could separately purchase this policy.
Why still need discounts?
Looking at what actions are held today in Russia and other countries, we can conclude that a discount as a tool to stimulate consumer activity ultimately provokes many other consequences, which also lead to profits. In particular, it is worth noting only a few of them:
- Formation of the "core" of regular customers. Stocks of supermarkets, attracting consumers living nearby, ultimately lead to the fact that a person begins to monitor available discounts on an ongoing basis and actively use them.
- Meet new products. In this case, the initial clientele is attracted, interested in certain products, thanks to which the target audience is significantly expanded, and the average check is also noticeably increasing.
Thus, an increase in sales is ensured, and constantly held actions (St. Petersburg, and other cities resort to using such a tool quite often) provide the organizers with a much higher profit than the cost of such events.