And profits will increase further if retail stores give steeper discounts or even donate excess stock to charities according to a study by researchers at Santa Clara University, Santa Clara and published in the current issue of Management Science . The report's authors created a mathematical model that sets optimal prices and adjusts inventories during end of season clearance. It does this on a shop by shop basis rather than for the entire chain and balances price, sales rates and inventory. In two test cases of the programme, a 300 store chain in the US saved $45m and a 600 store chain saved $10m. A third test did not increase profits, but this was later attributed to inexact inventory and sales figures. The researchers' recommendation? Give steeper markdowns early during the sale but excessive markdowns at the end of the sale should be avoided in favour of donating products to charities or even discarding unsold merchandise.