Loss Leader

A pricing strategy often used by big Box stores. Is it a good strategy for retailing plants?


Very loosely …… a product sold at a loss to attract customers.

Loss Leader is a pricing strategy where a popular product is sold at a price below its minimum profit margin, though not necessarily below cost to stimulate other sales of more profitable goods or services.

Sometimes it’s used to draw customers into a store where they are likely to buy other goods at the same time as the loss leader. Therefore it will increase the volume of products sold on the day and the retailer looks to achieve bigger profits too. Box stores will often do this to sell product accessories on electrical tools which tend to have a higher profit margin and are often impulse buys. It can also be a useful strategy for perishable items.

Key to the success of such a strategy is monitoring – maintaining a regular analysis of the sales and profits from the lost lead and the associated stock that you are aiming to sell more quickly so that you know overall you are not suffering a net loss.

But is this a good strategy for retailing plants and their linked products?

There are definitely other marketing and pricing strategies garden retailers can use which preserves margins for grower and retailer but presents good value to the customer.

Multi-buys is one – and I’m not talking about Buy one, get one free which is being phased out by some Supermarkets in favour of selling individual items at lower prices. They are countering accusations of fuelling food waste and obesity. Fortunately gardening is recognised as a healthy activity and escapes this kind of attention..

There are many ways garden centres can can price for value or provide the perception of value on multiple items that will improve the lives of our customers and be easier on their wallets. Garden Retail Success can help you with pricing strategies that work.

Garden centres often restrict multibuys to popular bedding & colour products but with a little lateral thinking you can use this principle for any product. Using landscape principles to sell plants in uneven numbers … 3’s; 5’s 7’s for impact and a pleasing appearance for example, will improve many front gardens and borders to the delight of your customers.

Offering orchard packs of fruit trees; or winter clean-up garden care packs or package deals to make your own basket or window box or raised veggie garden kitset packs. Everything you need to plant a square metre of garden; be it a border garden, front yard garden, picking garden or veggie garden. Everything to grow orchids. The opportunities are endless.

There’s another important reason why Garden centres should review Loss leader strategies.

Garden centres have a role to play educating the public at large and communicating with our customers about the effort and time it take nurseries to grow quality plants to a size that meets demand. We should be communicating the value of plants to our planet, our landscapes, our health and our lifestyles.

More and more it's these reasons that will drive people to garden centres to buy plants for good and for pleasure. To maximise profits, it goes without saying that first you have to maximise sales.


- Joy Lamb