1 Clearance Overview

A clearance event is designed to clear out-of-date merchandise and slow-selling merchandise out of stores and warehouses. A clearance markdown is considered a permanent price change, and inventory is consequently revalued when it goes into effect. Item/location combinations on clearance can be optionally reset back to regular price. This may be done if an item will be brought back for a new season. When the reset date for a clearance has passed, the item's price and inventory value is returned to the regular price. In Pricing, clearance events are organized into groups. Clearance groups allow you to better manage your clearance events by keeping related markdowns and/or resets together and support mass update and approval for events in the group. The following clearance events can be created in a group:

• Markdown - Discounts the selling price of one or more item/location combinations.

• Reset - A reset will close out the clearance event, setting the item/location combinations back to the last regular retail price.

If supplier-controlled pricing is enabled for Consignment and Concession ownership models through system option configuration in Merchandising, the item/locations added to a clearance event can be based on a selected primary supplier and purchase type. When consignment/concession items are added to clearance events, based on the pricing control value which is defined at primary supplier/location level for consignment/concession items in Merchandising, the clearance events can either be created and managed by the retailer or the supplier. Only item/locations for which the pricing control is Retailer can be added to clearance events created via Pricing user interface. For item/locations with Owned purchase types, item/locations are always managed by retailer users.

When clearance events are created via online screens in Pricing, the Generated By field in Pricing is systematically set as Retailer. This field indicates what type of user has created a given clearance group, a retailer user or supplier user.

When a clearance event is created, it must go through a series of checks before it can be applied to an item/location. A clearance may be in any of the following statuses:

Table 1-1 Clearance Status

Status	Definition
Worksheet	The clearance has been created, but not reviewed or able to be executed.
Submitted	The conflict checking has been completed, if applicable, and the event is pending approval. Conflict checking is run for clearances that have been submitted based on the setting of a system parameter.
Approved	The clearance has passed all conflict checking and has been approved and will be sent to the store or warehouse for execution based on a system option defined number of days prior to its effective date.
Executed	The markdown or reset has been made effective for the item/locations on the event.
Rejected	The clearance event has been reviewed but could not be approved without updates.
Processing	The clearance is being processed in conflict checking.

Best Practices

When creating clearance events for a group of items, it is recommended to enter the item data at the highest level possible. For fashion items, this is generally parent item (style) or parent/diff (style/color), whereas for grocery and hardlines this is generally at the transaction item level (SKU). This is also true for the selection of locations; it is recommended that clearance event are created at zone level, rather than by store or warehouse. This provides the following advantages:

1. Managing price events at the higher levels will increase the usability of the application by having fewer rows for you to manage. It will also help ensure pricing consistency for similar items and locations, in line with your company pricing strategy.

2. The Future Retail tables will have the ability to store data at the highest level possible which, in turn, will ensure that Pricing Cloud Service will run as efficiently as possible, including response time for processing and screen flow.

Note:

When supplier-controlled pricing is enabled for Consignment and Concession ownership models through system option configuration in Merchandising, the clearance events are created at the level at which the ownership and pricing control values vary between parent and child items in Merchandising. If there is no variation between parent and child items or for locations within a zone, the clearance event will be created at the level it was entered, else this will be exploded and created at transaction item/location level.

Emergency Price Events

There is a system option, called Price Event Processing Days, that is set to designate the number of days required between the current date and the effective date of a price event. This ensures that clearances are created and approved with enough advance timing that stores and other impacted areas can react accordingly.

However, for situations where price events were missed for one or more items or locations, emergency price events can be created. This allows you to create events that go into effect less than the standard number of processing days, which can even include the current date. A separate security privilege provides the ability to limit the users that can create these emergency events, while preventing others who have the ability to create clearance events from creating emergency events. For example, if the setting for price event processing is 3 days, you will be prevented from creating or approving an event that occurs within 3 days, unless you have emergency security privilege.

When an emergency price event is created and approved, the information is passed to downstream systems the next time the batch extracts are run. If the clearance is to go into effect on the current date, then the item/location price in Merchandising is updated on approval, along with any markdowns or markups in the stock ledger.