Successfully managed the partial sell-out of inventory, generating sales and enabling space to be cleared for the new assortment.
By the numbers
Gordon Brothers has a long-standing relationship with the Metro Group, completing 17 projects for the company over a nine-year period.
In 2016, Makro in the Netherlands and Belgium conducted a strategic review of the product range, considering such factors as sales, margin, stockholding, space and customer demographics and identified both whole categories and products within categories, that they no longer wished to stock. This initiative took place at the same time as a major refurbishment programme in stores and a restructuring of roles and responsibilities in the Head Offices. Given the amount of change that the company was going through, Makro turned to Gordon Brothers to manage the sell-out of the obsolete inventory, enabling Makro personnel to focus on the ongoing business.
The first phase of the project took place in the Netherlands where Makro’s eight smaller stores were re-ranged and re-furbished. With the help of store staff, Gordon Brothers consultants identified up to 9000 newly discontinued lines in 292 out of 369 categories and ticketed them for clearance. A sales and discount plan was established and a strong signage, marketing and media package was implemented to ensure a 100% sell-through by the planned end-date. As with any plan, performance was reviewed daily and tactical changes implemented where appropriate to ensure the best possible result for Makro.
The second phase of the collaboration took place in 2017 in Belgium where all six, much larger stores were re-furbished and re-ranged. In Belgium, up to 22,000 skus in 231 out of 287 product categories were identified for clearance. A thorough, highly visible hybrid marketing plan was executed, attracting new customers as well as ensuring repeat visits from existing customers at a time of major refurbishment disruption in some stores.
In overall terms Gordon Brothers and Makro liquidated stock in up to 79% of product categories, varying between 1% and 100% of products within those categories. This equated to circa 33% of stock cleared in any given store. Sales targets for the discontinued products were exceeded in both countries and Makro also benefited from higher customer frequency for the ongoing range.