Ace the CPCA Challenge 2026 – Unleash Your Professional Power with Practice Questions!

A markdown strategy is often implemented by retailers primarily to clear out seasonal inventory. Seasonal inventory consists of products that are typically in demand during a specific time of year, such as holiday items or summer apparel. As the season progresses and the demand decreases, retailers are motivated to reduce prices to encourage sales, making room for new merchandise that is more aligned with current trends or seasons.

By effectively employing markdowns, retailers not only manage their inventory more efficiently but also enhance customer satisfaction by offering desirable items at reduced prices. This strategy facilitates the turnover of stock, helping the retailer maintain a fresher assortment of products, which can lead to increased foot traffic and, ultimately, more sales.

The other options do not align with the purpose of a markdown strategy. Raising customer prices contradicts the essence of markdowns, which are designed to decrease prices. Maintaining high inventory levels is counterproductive to the goals of markdowns, which aim to move inventory out. Lastly, limiting stock selection does not reflect the objective of a markdown strategy, as retailers typically want to encourage a variety of options for customers rather than restrict them.