You must obey this law… and if you don’t, you will suffer.
While flouting this law won’t get you a jail sentence, it could contribute to the death of your business.
What law are we looking at here?
The Law of Supply and Demand.
There are times of the year when supply (of incoming goods) exceeds not just demand (customers shopping) but more importantly, physical limits (the size of your space!)
What to do? Some consignment shopkeepers put a sign in their window and a note on their social media: “No more consignments until we’re caught up.” What I have to say on this topic.
Some shops get pickier, attempting to only accept sure-sellers. This isn’t altogether bad; it’s just that unless there are actual sales numbers to back up hunches, those hunches could be incorrect and cost sales. But more importantly, trying to ONLY accept items which are 100% sure things makes your shop boring. Kate’s tips on not boring shoppers to death.
There’s another way to handle too-much-too-fast,
and this where the Law of Supply and Demand comes in. It states, in part, that if there’s more supply than demand for a given commodity, you must lower the price to motivate people to buy it.
Now in resale, there are several ways to lower the prices of, say, too many sets of china or a bulging rack of black pants.
You can set the starting price of such goods lower, and continue as normal with your scheduled markdowns. Lower prices will help keep goods moving through the shop, and after all, it’s not that you’re accepting too many sets of china, it’s that they aren’t selling as fast as you would like them to!
Or you can have an extracurricular price reduction (e.g. All black pants 20% off this week or even this wonderful Kudos! idea) to clear the racks or shelves for fresh goods. If you opt for this choice, be sure that you are not wiping out your business profits. And don’t rely on such markdowns often, lest your clientele learns to watch for the manic look in your eye before they buy!
So the next time you’re feeling overwhelmed by incoming? Don’t turn suppliers away and don’t let your merchandise stagnate or get dull. Think, instead of supply and demand and how lower prices can ease this temporary problem and keep suppliers and customers happy. Your profit margins will keep you smiling too, as your stock turnover rises!
Auntie Kate The Resale Expert 