Measuring Marketing

Chapter 44 Markdown Goods Percentage

Measurement Need

Retailers sell products at both full retail and markdown prices. Markdowns refer to the amount reduced from the original selling price. The markdown goods percentage (MGP) describes the percentage of total net sales attributed to products sold at markdown prices. MGP also helps retailers determine their effectiveness at selling products at full price since the difference between total net sales and sales from markdown prices is full price sales.

Solutioni

MGP is represented as follows:

$MGP=\frac{S_{nmt}}{S_n}\times 100$

Where

MGP = markdown goods percentage

Snmt = net sales at markdown during time period t

Snt = total net sales during time period t

For example, if a retailer sells $10,000 ...