VP of Sales must decide whether to change the perishable markdown strategy across 340 stores
Market Context
The global retail sector exceeded $28 trillion in sales with margins between 0.2% and 6.1%. Over 1 billion tons of food are wasted annually, with 12% attributed to retailers. In this chain, 14% of perishable inventory becomes a loss. Markdowns are executed by the store manager—without standard criteria, elasticity analysis, or result traceability. Nobody knows if discounts protect or destroy margin.
Sources: UNEP Food Waste Index 2024 · Statista Global Retail 2024 · Marketing Science (Jain et al. 2024)
Diagnosis of 5 critical categories. 5 structured alternatives: fixed markdown, dynamic by shelf life, bundling, scheduled donation, maintain current policy. Margin sensitivity vs. waste by store format.
Weekly monitoring: shrink %, gross margin by category, sell-through rate. Automatic alert if shrink rises or margin falls outside the approved envelope.
VP confirms: partial result. Shrink dropped from 14% to 9.8% across the 5 categories. Margin increased 1.1pp. Produce category didn't respond—new cycle opened with inherited context.
Without governance (Standard)
- × Store manager decides alone, without standard criteria
- × 30% markdown applied too early—margin destroyed
- × Or markdown too late—product discarded
- × Nobody knows if the discount protected or depreciated
- × No trail. No precedent. Next decision starts from scratch
With Arcogi governance
- ✓ 5 alternatives compared with declared impact by format
- ✓ Risk of each option registered before execution
- ✓ Rollout by category—started with the 3 most critical
- ✓ Deviation in Produce detected in week 5—adjusted without reopening the cycle
- ✓ Original decision intact with full audit trail
Retail — Perishables Markdown
Without Arcogi
The store manager checks the inventory dashboard. The BI suggests a 30% markdown based on aging. In another store, the suggestion is 20%. Recommendations vary, but the criteria are not formalized, alternatives to action are not compared, and the decision's effect is not tracked clearly.
Pricing copilots can increase the speed of suggestions, but they do not solve the core issue: who decided, based on what criteria, among which alternatives, and with what real effect on margin, sell-through, and shrink.
At the end of the quarter, leadership receives the consolidated report. They see the outcome. But they cannot precisely see which decisions helped protect value — and which depreciated it.
With Arcogi
Arcogi transforms recommendation into governed decision-making.
Before any action, alternatives are structured, compared, and recorded with their projected impacts by category, format, and operational context. BI and copilots act as context sources, not as the deciding authority.
The decision-maker chooses based on a clear trail. The execution is recorded. The outcome is tracked.
When real behavior diverges from expectations, Arcogi allows for mid-cycle adjustment — not just retrospective reading at closing. In the next markdown, the organization starts with the memory of what worked, what didn't, and under what conditions.
Why this matters to the C-level
Because dashboards show the past and copilots suggest paths — but neither alone governs the decision.
Arcogi is the layer that connects context, choice, execution, and outcome, transforming suggestion into a traceable decision and value capture into executive discipline.
Essential
Full cycle + dossier + trail. VP confirms result in 90 days. The company knows what was decided, why, and if it worked. Learning happens—with a delay, but it happens.
Complete
Everything in Essential + weekly monitoring of shrink and margin. Deviation in Produce detected in week 5. Approach adjusted without reopening the cycle. Result confirmed with real data—not perception.
"The risk wasn't getting the discount wrong. It was not knowing we were getting it wrong—across 340 stores, every day, with nobody measuring."