Clearance 2.0: AI-Optimized Markdown Management (Beta)

Quicklizard is proud to introduce the Beta for the new Clearance and Markdown module (Clearance 2.0). This module addresses the challenge of efficiently selling through dead, aging, overstocked, or end-of-life inventory.

Instead of relying on manual calculations or ad-hoc decisions, Clearance 2.0 provides an AI-optimized cadence of markdowns designed to clear inventory while maintaining visibility, predictability, and alignment with your business objectives.

Why use Clearance 2.0?

Our approach is built for merchandising, pricing, and inventory teams responsible for the delicate balance between sales velocity, margin protection, and stock liquidation.

• Consistency: Ensure discounts are applied consistently across products, locations, and channels.
• Profitability: Avoid ad-hoc decisions that erode margins.
• Clarity: Prevent customer confusion caused by erratic pricing.
• Efficiency: Accelerate sell-through to free up working capital and valuable shelf space.

When should you use this module?

This module is best utilized when products are leaving your core selling strategy. Specifically:

• When inventory levels risk becoming obsolete.
• When managing end-of-life (EOL) products.
• When you need to aggressively free up shelf space for new arrivals.

Please talk to your CSM if you want to start using the Clearance and Markdown module.

How to Configure a Clearance Strategy

Follow this step-by-step guide to configure your Markdown rules within the Quicklizard application.

1. Create a new Pricing Strategy

• Navigate to the Pricing Logic menu and select the Pricing Strategies sub-menu. 
• Either access an existing Pricing Strategy that you want to extend with a Clearance rule or create a new Pricing Strategy using the Add Pricing Strategy button and selecting the Single option. 
• Give you Strategy a name and then select the Pricing Rules tab.

2. Define the Pricing Rules

• By default a new Strategy is always applied to all products that use the Strategy. If you want to only apply the strategy when certain conditions are met, you can do so by setting the Conditions.
• To enable the Clearance rule, you need to select the Clearance Markdown value from the drop-down list of Rules on the right-hand side. This will open the configuration window for your markdown logic.

3. Define Core Parameters

Once inside the Clearance rule setup, configure the following:

• Primary Objective: Select whether Profit or Revenue should be maximized during the clearance.
  • Profit: when you want to maximize your profit considering product cost (e.g., in case you can return leftovers for free to the supplier, or when you have liquidation service providers)
  • Revenue: when final leftovers will have to be scrapped and you can ignore their purchase price/cost.
• Initial pricing strategy: Choose the initial intensity of the discounts, by selecting Gentle or Aggressive. 
  • Gentle: means a soft start with a low markdown at first and then increase aggressiveness over time. This is best suited if you first want to test the market reaction, or if you have a longer time till termination.
  • Aggressive: this is best suited to quickly free-up space in the warehouse, and to show impressive markdowns to promote with marketing measures alongside.

4. Set the Clearance Schedule

Define the active period for this clearance campaign:

• Start Date: Select the attribute (date or releasedate) that defines when the markdown begins.

• End Date: Select the attribute (date or releasedate) that defines when the markdown must end.

  Note: you must ensure that your account contains attributes with the names date and/or releasedate.

5. Define Target Inventory Level

• Target Stock Level: Enter the target stock level percentage versus the initial inventory.

  Note: This calculates against the inventory captured at the clearance start date.

• Price Direction: You can check the box to "Prices can only decrease" to ensure prices never rise, or leave it empty if you want to allow AI-driven increases during the clearance period.

6. Set Markdown Execution parameters

To maintain governance over the pricing, set your specific limits:

• Minimum Discount: The starting discount percentage.
  • E.g., in order to avoid too low to communicate discounts
• Discount amount per price change: The percentage increment for subsequent markdowns.
  • E.g., multiples of 5 percentage points (5, 10, 25%), or multiples of 10 (10%, 20%, 40%)
• Maximum number of price changes: The absolute amount of changes that can occur during the clearance period.
• Price Review Cadence: How frequently the markdowns should occur.
  • E.g., different options for 7, 14, etc days are available

7. Set Alert Threshold and Save

• Set your Alert Threshold to be notified of specific performance issues. 
• Finally, click Save to store the rule.

Your Clearance Markdown rule is now active. Quicklizard will begin optimizing your pricing to drive timely inventory reduction while keeping your decisions transparent and measurable.