Retailers spend between 3-10% of their revenue on promotions. Our research indicates 20-30% of all these promotions are unprofitable. In this article we outline how retailers can increase the %-share of profitable promotions and improve overall margins with 2-5%.
Our data suggests that promotions typically account for 10 to 45 percent of a retailer’s total revenues. And for sure, promotions are a powerful instrument for increasing sales and margins, but they are also difficult to use effectively.
When it comes to retail assortment there is a question that's crucial for both growth and profitability. How large share of your assortment should consist of Private Label Brands (your own brands) vs. National Brands?