I worked for a well-known, high end apparel chain for almost ten years. I used the example of the ugly purple shirt to illustrate our sales and accounting options.
1. If we could sell the shirt at full price that is what we would do,
2. if we could not get full prince, we would mark it down by 20% or 33% whatever it took to sell it,
3. If we couldn’t sell it in the store, we could try to return it to the manufacturer. Not an easy thing to do.
4. If we couldn’t return it we would try to divert it out to a store like Marshall’s or a competitor.
5. If we couldn’t divert it, we could sell it to a jobber like Odd Lots sales or someone similar at maybe 15 cents on the dollar
6, If we couldn’t job it out, we could sell it to an exporter who would send it to Africa or the Philippines or some other third world company at maybe a nickel on the dollar.
6. In the case of real high-end shirts, all cotton, high quality, we could sell it to a ragman who would bleach the goods, crush it and send it to someone who made 100% rag paper like Crane’s .
Sending it directly to Goodwill or someone similar simply to get a tax deduction is the least preferable option. ANY revenue is better than no revenue.