I. Introduction: What Are Penny Items?
At Home Depot, a "penny item" refers to merchandise that rings up at $0.01 due to internal inventory clearance systems - not public promotions.
These aren't sales. They're items that:
- Have been chosen for removal from inventory
- Are no longer intended for sale
- Still happen to be on shelves because of oversight or delays
This process is driven by Zero Margin Adjustment (ZMA) - a financial mechanism that reduces an item's value in the system to nearly zero. While these items are meant to be removed, some stay on the floor and can still be bought.
This guide is based on consistent community reports and retail logic, not official Home Depot policy. Practices may vary by store.
II. Understanding the Clearance Lifecycle
At Home Depot, clearance items follow a markdown sequence that may eventually lead to the $0.01 "penny" status. While unofficial, two distinct markdown patterns - or Clearance Cadences - have been consistently seen by shoppers.
Clearance Cadence A (Approx. 13 Weeks)
| Stage | Price Ending | Discount | Duration | Notes |
|---|---|---|---|---|
| Initial Markdown | .00 | ~10-25% off | 4 weeks (est.) | Enters clearance |
| Second Markdown | .06 | ~50% off | ~6 weeks | Signals progression |
| Final Markdown | .03 | ~75% off | ~3 weeks | Last stage before removal |
| System Update | $0.01 | Internal | - | If not pulled, system marks as penny item |
Clearance Cadence B (Approx. 7 Weeks)
| Stage | Price Ending | Discount | Duration | Notes |
|---|---|---|---|---|
| Initial Markdown | .00 | ~10-25% off | 1-2 weeks | Starts clearance |
| Second Markdown | .04 | ~50% off | ~4 weeks | Often missed by shoppers |
| Final Markdown | .02 | ~75% off | ~2 weeks | High likelihood of penny pricing next |
| System Update | $0.01 | Internal | - | System triggers penny status |
Quick Reference: Price Ending Cheat Sheet
| Price Ending | What It Means | Chance of Penny |
|---|---|---|
| .00 | First markdown, entering clearance | Low |
| .06 | Second markdown (Cadence A) | Medium |
| .03 | Final markdown (Cadence A) | High |
| .04 | Second markdown (Cadence B) | Medium |
| .02 | Final markdown (Cadence B) | High |
| .97 / .98 | Regular sale price | Extremely low |
| Others (e.g., .56) | Inconsistent meaning | Low - speculative only |
Price endings matter - they signal where an item is in its markdown lifecycle. Watch the clearance tag date to estimate when the next drop may happen. Don't rely on fixed timing - while these cadences are common, store exceptions exist.
II-A. Clearance Cadence Timeline
Typical markdown progression before items hit $0.01. Timing varies by store/category, but the sequence stays consistent.
Stage 1: .00 (enters clearance)
~1–4 weeksFirst markdown; watch the tag date for the next drop.
Stage 2: .06 or .04
~2–6 weeksMid-clearance; seasonal items often move faster.
Stage 3: .03 or .02
~1–3 weeksLast visible price before penny; check top/bottom shelves and endcaps.
System update: $0.01
InternalIf not pulled, the UPC scans at $0.01. Scan the UPC, not the yellow tag.
Older tag dates often mean the next drop is coming soon.
App shows “Unavailable” / “Ship to Store”
Common right before penny. Still verify in-store with the UPC scan.
II-B. Visual Label Recognition
Know what to look for. These are real Home Depot clearance labels at different markdown stages. The price ending tells you how close an item is to penny status.
The price ending matters more than the actual discount percentage. A $150.06 item is more likely to penny than a $5.97 item, even though $5.97 seems cheaper — because .06 signals mid-clearance, while .97 is just a regular sale.
II-C. Overhead Hunting
Clearance items often get moved to the overhead (top shelves above the aisles) when they're being phased out. These are prime penny targets — but there's risk when asking employees to pull them down.
What to Look For
- Yellow clearance tags visible from the floor
- "No Home" sections in the overhead — items without a shelf location (prime penny territory)
- Dusty or old-looking boxes — means they've been sitting for weeks
When you ask an employee to pull an overhead item, they can scan it from the floor with their Zebra device before pulling it down. If it scans as $0.01, they'll likely refuse to give it to you or remove it from inventory. Only ask for overhead items if you're willing to take that gamble.
III. Pre-Hunt Intelligence: Using Digital Tools
Before heading into a store, use Home Depot's app or website to scout items that might have reached penny status. It won't show you the $0.01 price directly - but it can give you signals that an item has been marked internally.
In the app or online, set your specific store location. Inventory and pricing data is store-specific - wrong location = wrong info.
Find the SKU number on product packaging or clearance tag. Use that number in the Home Depot app or site search.
Use the chart below to decode what the listing might mean.
Interpreting Online Status
| Online Status | What It Could Mean |
|---|---|
| In Stock + Clearance Price visible | Still in clearance cycle, not pennied yet |
| In Stock + Full Price | Still active inventory |
| Out of Stock / Unavailable / Ship to Store Only + Full Price | Strong penny candidate - system may have pennied it, but it hasn't been removed from shelves yet |
| Clearance price still showing online | Not yet a penny item |
If the system shows a full price but no stock, it might have already hit $0.01 internally and just hasn't been pulled.
Limitations to Keep in Mind
- Online data isn't real-time - there can be a delay of 1-2 days
- The penny price ($0.01) never shows online
- You still need in-store confirmation to be sure - this is just a filtering step
When to Go In-Store
Only go check in person if:
- You've found an item that shows no local stock but is still listed online
- You're tracking the item based on its clearance cycle and tag date
- You've seen reports in penny shopping communities about that item pennied out recently
III-A. How to Verify Penny Status In-Store
The only way to confirm if an item is truly at $0.01 is by getting an employee to scan the barcode or look up the SKU. Here's the safest way to do it without losing the item.
The Right Way (Low Risk)
Take a photo of the barcode/SKU label — but leave the item on the shelf. This is critical.
Look for an employee with a "Zebra" device (looks like a phone, sometimes orange). This is the scanning tool they use for inventory.
Say: "Can you check if this item is in stock?" or "Can you look up this SKU?" — show them the photo of the barcode or give them the SKU number.
If it scans as $0.01: They'll likely say it can't be sold or they'll go pull it from the shelf. Play it off: "Oh, guess it's not here then."
If it's NOT a penny: You can walk away — no item lost, no suspicion.
The Wrong Way (High Risk)
- Bringing the item to them directly — if they scan it and it's a penny, they'll take it immediately.
- Asking them to pull overhead items first — Zebra devices can scan from the floor. If they scan before pulling, you lose it.
- Asking for a "price check" — this signals you're trying to buy it, making them more likely to confiscate it if it's a penny.
Self-Checkout: The Fastest Path
If you're confident an item is a penny (based on the Community Penny List or your own research), skip verification and go straight to self-checkout:
- 1. Scan the UPC barcode (the manufacturer barcode on the product, NOT the yellow clearance tag)
- 2. Pay immediately — don't hesitate, don't review the screen slowly
- 3. Leave quickly and quietly — the faster you're out, the less attention you draw
- • Use Home Depot Pro Pass if you have one (scan pass → items → pay in 2 taps)
- • Time your checkout when other customers are checking out (less staff attention)
- • Avoid scanning the yellow clearance label — it can freeze the terminal and call a manager
If an employee makes a fuss or refuses to sell, leave it. No penny item is worth an argument or being banned from the store. There will always be more penny finds — the goal is to stay in the game long-term.
IV. In-Store Penny Hunting Strategies
Once you're in the store, your goal is to find penny-priced items that haven't yet been pulled from the shelves. These are usually clearance items that slipped through the cracks.
Where to Look
Primary Hotspots
- Original aisle/bay location (check the label for Aisle/Bay number)
- Yellow clearance tags scattered throughout regular aisles
- Seasonal sections (especially post-season)
- Overhead storage (see Section II-C)
Hidden Gems
- Bottom or top shelves in standard aisles
- Back corners or dusty areas
- Outdoor garden section (during seasonal changeovers)
- Misplaced items left by customers
Most stores are phasing out clearance endcaps (EC) and keeping clearance items in their original aisle locations instead. Some stores still have them, but don't rely on finding a dedicated clearance section anymore — you'll need to hunt aisle by aisle.
What to Look For
Certain categories tend to hit penny status more often:
Watch for "known penny items" discussed in online communities - these often go chain-wide. "Store-specific" pennies usually result from returns, overstock, or untracked markdowns.
How to Check the Price (Discreetly)
Best Method: Self-Checkout (SCO)
- 1. Go to a SCO terminal with the item in hand
- 2. Scan the manufacturer's UPC barcode - not the yellow clearance sticker
- 3. If it scans at $0.01, pay at once and print your receipt
- 4. Stay low-key - don't draw attention to the screen
Scanning the clearance tag can freeze the terminal and flag an employee.
Backup Method: Ask for a Stock Check
If you must ask an employee:
- Look for one using a FIRST phone (orange handheld scanner)
- Say: "Can you do a stock check on this?" - not a price check
- Give them the SKU or show the UPC barcode
- Watch the screen discreetly: if it shows $0.01, "0" quantity, or an error - it's probably pennied
Overhead Items: High-Risk, Mixed Results
Items stored overhead present a unique challenge - and some real risks:
Yellow Ladders (Customer Use)
Small yellow ladders (often in paint section) are for customer use. You can use these - just know they're visible and will draw attention.
Orange Ladders (Employee Only)
These are strictly for employees. Using them as a customer is against store policy and can escalate quickly.
If you ask an employee to retrieve an overhead item, there's a 50/50 chance they'll scan it first. If it scans at $0.01, they'll likely say "This can't be sold" and that item will be removed from the floor entirely.
V. The Checkout Challenge
You found a penny item. Now comes the tricky part: getting it through checkout without issues.
Preferred Method: Self-Checkout (SCO)
- 1. Have your payment ready before scanning
- 2. Go to a self-checkout kiosk where the attendant is distracted or busy
- 3. Scan only the UPC barcode on the item itself - not the yellow clearance tag
- 4. Confirm it scans at $0.01
- 5. Pay immediately
- 6. Print your receipt - this is your proof of purchase
- 7. Exit calmly. Act like it's just another item in your cart
Optional Trick: Use a "Keeper Item"
Add a small, inexpensive item you plan to buy:
- Makes your transaction look more normal
- Distracts attention from a suspicious $0.01 item
- Useful when checking out with help or retrieving items from locked displays
Multiple Penny Items?
- You can buy multiple units of the same penny SKU in one transaction
- Don't scan different SKUs together unless you want extra attention
- When in doubt: one penny SKU per checkout
Locked Case or Cage Items
- 1. Add a "keeper" item to your cart
- 2. Ask a staff member to unlock the item
- 3. Politely direct them toward self-checkout
- 4. At SCO: Scan the keeper item first, then scan the suspected penny item. Staff may leave once the item is scanned.
- 5. Pay and print your receipt as usual
If You're Stopped by an Employee
Do This
- Stay calm and polite
- Finish payment if possible and print your receipt
- Say: "That's just what it scanned for." or "I found it on the shelf and thought I'd buy it."
Don't Do This
- Admit you were looking for penny items
- Get angry or argue
- Cause a scene - it's not worth risking future visits
If They Demand the Item Back After Purchase
You can try:
- "I've completed the purchase and have my receipt. I'm not returning it."
- If pressed: "Can I speak with a manager for clarification on store policy?"
Some stores might honor it, others may confiscate it. Reactions vary.
VI. The Inside Scoop: Internal Operations
Understanding Home Depot's internal operations helps you grasp why penny items exist, why staff act the way they do, and how the system works behind the scenes.
Penny Items = Not Meant for Sale
Home Depot doesn't price things at $0.01 for customers - it's an internal accounting mechanism triggered by Zero Margin Adjustment (ZMA).
Why does it happen:
- Item is discontinued, damaged, expired, or no longer worth selling
- Store uses ZMA to reduce its system value to $0.01 (effectively zero)
- System flags it for removal from shelves - but sometimes it gets missed
If an item is still on the floor at $0.01, it's likely due to oversight or staff backlog.
Employee Policy: Strict Rules
- Employees are forbidden from buying penny items - doing so results in termination
- Many stores enforce a "24-hour rule": staff can't buy newly marked-down clearance until it's been on the floor for 24+ hours
- This prevents staff from hiding items for themselves
FIRST Phones & the Clearance App
Home Depot equips staff with handheld devices called FIRST phones. The Clearance App lets associates:
- See a list of clearance items, including penny-priced ones
- Filter by department, location, price, on-hand stock, and "no home" items
- Flag items for removal
This tool helps staff actively search for and remove penny items from the sales floor.
Why Management Cares So Much
Managers are pressured to remove penny items because they:
- Hurt shrink metrics (loss due to theft, damage, system errors)
- Signal poor inventory control
- Represent a financial loss (even at a penny, the system records a transaction)
- Disrupt inventory accuracy for automation and reorders
SOP Reality: Policy vs. Practice
Enforcement varies:
- Some managers will quietly honor the sale to avoid escalation
- Others will confiscate the item or cancel the transaction
- Some employees may even give it away as a "damaged out" freebie - rare, but it happens
Same store, different shifts = different outcomes.
VII. Research Deep Dive: Fact vs Fiction
Despite how widespread penny hunting has become, Home Depot has never publicly confirmed the full clearance-to-penny process. Most of what we know comes from community observations, shared screenshots and receipts, and logical deductions from how retail clearance cycles work.
What's Real vs. What's Rumor
| Claim | Verdict | Explanation |
|---|---|---|
| Items go to $0.01 | True | Via internal ZMA process |
| Price endings predict markdowns | True | .06/.03 and .04/.02 are common sequences |
| Penny items are "secret sales" | False | They're not intended for sale at all |
| Home Depot honors the first scanned price | Sometimes | Depends on the manager |
| Employees buy penny items | False | Against policy and grounds for termination |
| Using ladders to get pennies is okay | Depends | Yellow ladder: yes. Orange ladder: employee-only (high risk) |
| Stores will always sell penny items | False | Many will cancel the sale or remove the item |
| Penny items show online | False | The $0.01 price never appears in the app or website |
How Dependable Is Community Intel?
Very - but with a few caveats:
- National penny items (brand-wide markdowns) are dependable across many stores
- Store-specific pennies (returns, damaged goods, unpulled clearance) are hit-or-miss
- Community screenshots and shared receipts are gold - but dates matter
Always check timestamps on community posts. A penny item from 4 weeks ago may already be pulled or long gone.
VIII. Responsible Penny Hunting
Penny hunting thrives on community, strategy, and discretion. Acting irresponsibly not only gets you shut down - it can cause stores to crack down harder on everyone.
1. Be Respectful to Store Employees
Even if you're frustrated, caught off-guard, or denied a penny sale: stay calm, stay polite, avoid confrontations. Staff are following orders - not making personal decisions against you.
2. Don't Be Loud About Finds
Getting loud, excited, or bragging at checkout draws attention. Don't show receipts to other customers, tell staff about your score, or film inside the store.
3. Use Community Resources Wisely
Share helpful info like UPCs, tag dates, or clearance cycles. Post accurate finds - not rumors. Don't flood groups with repeat questions.
4. Know When to Walk Away
If an employee or manager denies the sale, just move on. It's not worth getting banned from the store. Better to lose one item than burn access to future deals.
This is not a get-rich-quick game. Penny hunting requires time, patience, and a lot of empty trips. You might check 3 stores and find nothing. Don't expect huge savings every time - it's about the long game.
IX. Conclusion: Tips for Success
Whether you're just starting out or you've been hunting for a while, here's what matters most: know the system, stay patient, play it smart, and stay respectful.
For Beginners: Start Here
Understand the Basics
- Penny items are the last stage in Home Depot's clearance cycle
- They're not meant for sale - they exist due to oversight
Use the App and Website
- Set your store location before searching
- Look for items showing "Out of Stock" but still listed at full price
- Search by SKU or UPC when possible
In-Store Tips
- Go straight to clearance endcaps and seasonal sections
- Check price endings like .03/.02
- Use self-checkout, scan the UPC, print your receipt
- Don't scan the clearance tag
For Experienced Hunters: Refine Your Game
Know the Clearance Cadences
Items usually follow these patterns over 7-13 weeks
Look Beyond the Obvious
- Dig through misplaced inventory and dusty shelves
- Don't ignore garden centers, paint, or seasonal aisles
- Spot patterns when product lines get pulled storewide
Track Community Trends
- Watch social media groups for confirmed penny items
- Validate with dates and store locations
- Avoid spreading unconfirmed rumors
Final Mindset
Many hunters enjoy this for more than the savings: the thrill of the hunt, the satisfaction of outsmarting a system, and the camaraderie of a tight-knit, info-sharing community.
But remember: one person's unruly behavior can ruin it for everyone. Stay sharp, stay respectful, and help keep the game alive.
Penny hunting is part luck, part hustle, and all strategy. Treat it like a skill - not a shortcut.
Ready to Start Hunting?
You've learned the tactics. Now use our live, crowd-sourced penny list — usually updated within about 5 minutes with fresh finds from hunters nationwide.
Live Penny List (usually updated within about 5 minutes)
Crowd-sourced & current. Usually updated within about 5 minutes.
Fresh finds nationwide. Filter by state, search by SKU.
Report Your Finds
Found a penny item? Help other hunters by reporting it. Include the SKU, purchase date, and state — it takes 30 seconds.
Remember: Penny hunting is part research, part timing, part luck. Stay respectful, stay strategic, and help keep the community strong.