Pricing & Markdowns: the full procedure

Keep shelf and system prices accurate, set promotions cleanly, and mark down aged stock on a planned cadence while protecting margin.

• Applies to: Store manager / pricing associate.
• Frequency: Price audits weekly; markdown review per season.
• Scope: Covers price accuracy, label integrity, promotion setup, and the markdown cadence for slow-moving and aged inventory.

What you need

• POS / pricing system
• Label printer
• Markdown schedule
• Aging report
• Promo signage

The procedure, step by step

1. Verify price accuracy — Spot-check that shelf labels match the price the POS rings so customers are never overcharged or undercharged.
2. Maintain label integrity — Replace torn, missing, or outdated tags and remove old promo signage as soon as a sale ends.
3. Set promotions cleanly — Enter promotions in the system with clear start/end dates so pricing applies and expires automatically.
4. Set markdown guardrails — Define minimum and maximum discount rates in advance so staff don’t over- or under-discount.
5. Follow a markdown cadence — Take a first markdown around 6–8 weeks after arrival, then a deeper second cut a few weeks later as stock ages.
6. Stage discounts in tiers — Use progressive (tiered) markdowns to capture full-price sales first, then convert price-sensitive shoppers.
7. Watch the margin — Apply markdowns to clear cost-tied-up stock while keeping discounts within guardrails so the store doesn’t look like a brand in distress.
8. Re-tag & reconcile — Update shelf labels and system prices together, and confirm the change is reflected before leaving the section.

Quality check before you finish

• Shelf price matches POS price on spot-checked items.
• No torn, missing, or expired tags or signage.
• Promotions have correct start and end dates in the system.
• Markdown discounts fall within preset min/max guardrails.
• Aged stock followed the markdown cadence (no items stalled at full price).
• Shelf labels and system prices updated together.
• Margin reviewed before deep markdowns applied.

This is a free, source-anchored standard operating procedure (SOP) you can print and hand to staff. It documents the work sequence for a Small Retail Store business — not safety or regulatory rulings, which defer to the cited authorities, the applicable code, and your own health-and-safety plan. Open the tool above to print it, toggle ink-saver, or (with a free ToolFluency Business account) edit it to match your own workflow.

Sources

• Shopify — Retail Markdowns (shopify.com)
• Quikly — Retail Markdown Strategies (quikly.com)
• Toolio — Markdowns vs Discounts (toolio.com)