Some people think that the terms “sale” and “clearance” can be used reciprocally or as synonyms of each other, but they are used for two separate occasions in retail.
Key Takeaways
- “Sale” is a marketing strategy to offer products at a discounted price for a limited period. At the same time, “clearance” is a marketing strategy to sell off the remaining inventory to make way for new products.
- “Sale” is a planned event promoted in advance, while “clearance” is usually unplanned and can happen anytime.
- “Sale” items are usually discounted by a small percentage, while “a significant percentage usually discounts clearance” items.
Sale vs. Clearance
The duration of a sale is only for a particular period to spike up the deal. But in the case of Clearance, the latter is in effect indefinitely till the item or items are sold or pulled from the market.
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Sales are ventures associated with selling or the number of goods sold in a targeted period. A sale is a promotional movie created by businesses or store owners.
Clearance is usually used but not exclusively when a shop wants to clear a selective stock line. A Clearance does not have a definite timeline and can extend until all the stocks are removed or the aim is achieved, e.g., to clear 70% of the stock.
Comparison Table
| Parameters of Comparison | Sale | Clearance |
|---|---|---|
| Definition | Sales are actions associated with merchandising or the number of goods traded in a given targeted period. | A clearance is a particular type of sale that might attract more customers than traditional sales and eliminate certain stocks. |
| Time | The sale is up only for a particular period. | The Clearance is not over until the stock is cleared or the target aimed is achieved. |
| Motive | Sale helps in attaining a high turnover by assisting in reaching the target. | Clearance’s main motive is to clear the stock. |
| Price of products | After the sale period, the prices increase, returning to their original cost. | After clearance is complete, the prices of that stock don’t go up. |
| Advertisements | Stores do advertise when they have a Sale. | Stores do not advertise when they have a ‘Clearance.’ |
What is Sale?
A sale is a promotional tactic performed by businesses or store proprietors to attract more buyers and accomplish a high-priced turnover rate. While a deal is going on, you will see a popular item with a discounted price or other offers in effect, e.g., the offer of Buy 1, get 1 free.
Store-wide sales are organized for many year-round events, including the holidays, back-to-school shopping, or before the summers or winters.
This is a plot to tell shoppers that they should take precedence of sales to spend less and not wait until the price of a particular item goes back up.
Sale is the selling of goods or services or a reduction in the price. An example of a sale is the selling of a new car. An example of the latter is a 30% reduction in the price of all shirts at a store.
What is Clearance?
Clearance is the sale of existing products at a cheaper rate than the usual price to get them sold quickly to make room for new inventory. It is also known as closeout in many countries.
This might look appealing to a large pool of people, quality products at a discounted rate, but there is a catch to it. Products sold at clearance sales are mostly non-refundable or non-returnable.
Some stores have reserved places in their shopping section for clearance items. The longer a product is up for clearance, the lower the price conduces to go before the store pulls it from the inventory.
Main Differences Between Sale and Clearance
- After the sale, the prices of the products go high up, back to their original cost, whereas after clearance is complete, the stock prices don’t go up.
- Stores do advertisements when they have a Sale to amplify their event, but stores do not advertise when they have a ‘Clearance.’
- https://academic.oup.com/ej/article-abstract/117/522/964/5087781
- https://ieeexplore.ieee.org/abstract/document/5668359/
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Chara Yadav holds MBA in Finance. Her goal is to simplify finance-related topics. She has worked in finance for about 25 years. She has held multiple finance and banking classes for business schools and communities. Read more at her bio page.
