When I first saw this blog post this morning from IndiaCoco I just knew that I had to comment.
My career has led me to be a Senior Manager in a number of large retail organisations and I’ve seen the planned discounting at certain times throughout the year and the ‘distress’ discounting that occurs when they realise they are carrying too much stock or there is not enough cashflow in the business to pay the bills!
And.. i’ve seen how this destroys the retail industry. At this time of year I see so many stores ‘discounting’, so many people waiting for the sales to commence before they purchase and surely this is strangling our industry.
I know that retailers will always face a ‘price-war’ of some sort – however, what I never expected was that I would see the same products I sell at a much cheaper price than ‘break-even’ point.
And.. what concerns me here is that I remember what it was like when I had my first business, I didn’t really understand my numbers – when I thought I was doing well I certainly wasn’t and today I’m much more atuned to what a product costs, how much I can sell it for to demonstrate it’s value and how much it costs me to deliver that product..
So.. do business owners really understand ‘margins’ and ‘profit’ … or do they see the ‘glamour’ of running your own business and try to beat everyones price regardless of what this costs..
I do hope I’m wrong…