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Merchandising · Grocery · Fashion

Price Elasticity Recalibration

Elasticity drifted. Re-estimates and proposes moves that hold volume.

Target KPI Category margin
Executes in ≤ 24 hours
System of record Pricing engine · POS
Run this on your data → How the loop closes
Trigger condition

Realised volume response to the last three price moves deviates from the modelled elasticity by more than 20%.

Write-back

Updated elasticity coefficients written to the pricing engine; approved price changes scheduled to POS.

Every write is gated on an approver role you name. Nothing runs unattended.

Procedure
  1. Re-estimate elasticity per SKU from the last 12 months, controlling for promo, weather, and competitor moves.
  2. Flag where the drift is real demand change rather than a modelling artefact or a competitor action.
  3. Propose the price moves that recover margin without crossing the volume floor the category owner set.
  4. Open a case to the pricing lead. Every price-affecting write is gated on approval.
  5. Close when realised volume tracks the new elasticity within tolerance for 21 days.
Outcome metric

Category margin over 60 days against the pre-recalibration run rate, with unit volume held within the agreed floor.

The case closes on this number, not on the action being taken. A playbook without a close condition is a dashboard.

The rest of Merchandising

Markdown Cadence Reset Style velocity below cluster. Proposes a shallower, earlier ladder. Full-margin sell-through Promo Conflict Cancellation Cannibalization mid-promo. Models kill-or-narrow, ends the overlap. Net promo lift Assortment Rationalization Long-tail SKUs tying up capital. Ranks by GMROI, proposes cuts and adds. GMROI New SKU Velocity Gate A new item is missing its launch curve. Flags it for cut or support. GMROI Cluster Reassortment Cluster mismatched to demand. Re-maps to its real velocity. Sell-through

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