Discount Pricing Recommendations
It is well known that retailers have razor-thin margins. A few discount percentage points can make the difference between a bad and an excellent year. The goal of this project is to make sure that Altitude Sports’ prices are optimized to satisfy customers and maximize margins, all year long. There are a lot of factors influencing pricing decisions such as official and unofficial MAP (Minimum Price Policies enforced by brands), stock velocity, season stock levels, stock scarcity, cashflow and price elasticity. Furthermore, price elasticity in itself is highly variable. It varies by brands, styles, on/off peak seasons (ex: Black Friday), product category (ex: winter jackets in summer) and current promotions / discount levels. The project aims at developing a discount pricing recommendation system to maximize profit margin before or after shipping and logistics. The research will also lead to predictions on sales volume and margin, based on pricing recommendation.