POSTPONEMENT – PRICING STICKERS

We have a client that sells greeting cards to retailers in the U.S. and elsewhere. The greeting cards and envelopes are ordered from different suppliers, and we assemble the cards and envelopes into boxed and unboxed assortments for sale by our client. The greeting cards do not have a price printed on them, allowing the retailer flexibility to set the price for the cards; however, many retailers prefer to receive the cards pre-marked with a bar coded price sticker. To satisfy this need, we assemble and affix price stickers to a certain volume of cards, and assemble a certain volume of cards with no price sticker attached. There is a separate product code assigned to priced and unpriced card assortments, so that inventory can be tracked and orders can be filled by product code.

We suggested to our client that, if the retailers who required priced cards could be persuaded to affix the price stickers themselves (for a small price concession), we could ship the appropriate number of price stickers with these retailers’ orders. The advantage this suggestion offered our client is that this would eliminate the assembly costs associated with affixing the price stickers to the cards. Further, eliminating priced cards from inventory would reduce (by half) the number of products to be held in stock (This reduces our client’s storage costs). If certain retailers insisted on receiving pre-priced cards, we could affix the price stickers to cards to fill that order, and ship these orders.

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