Lower prices, lower quality?

I succumbed to the mass hysteria: I shopped this weekend.

It’s not a normal occurrence, but I needed new shoes for work. And while at the outlets in Williamsburg on Saturday, I noticed that the discounts were steeper than anything I’ve ever seen. Everything was 50 percent off at Banana Republic. The shoe store Bass had a sale, buy one, get two free.

How can stores make money on these prices? Are they lowering quality to drive down the cost to manufacture the goods? At Bass, I noticed that a lot of the men’s dress shoes weren’t leather. I finally found one pair that were leather. They were 60 percent off.

I succumbed to the mass hysteria: I shopped this weekend.

It’s not a normal occurrence, but I needed new shoes for work. And while at the outlets in Williamsburg on Saturday, I noticed that the discounts were steeper than anything I’ve ever seen. Everything was 50 percent off at Banana Republic. The shoe store Bass had a sale, buy one, get two free.

How can stores make money on these prices? Are they lowering quality to drive down the cost to manufacture the goods? At Bass, I noticed that a lot of the men’s dress shoes weren’t leather. I finally found one pair that were leather. They were 60 percent off.

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scottstev
scottstev
11 years ago

Lot’s of labels will make a specific lower-quality line, just for outlets.

Jon
Jon
11 years ago

Scott is right. Many articles on this subject. The following is from this article: http://articles.moneycentral.msn.com/SavingandDebt/ConsumerActionGuide/are-outlet-malls-for-suckers.aspx The outlet trap: 2 main factors to success “1.You might assume that outlet malls are situated far from urban centers because they need the space. But that inconvenience is also designed to create in shoppers’ minds what economists call the “sunk cost fallacy.”” “:The extra time and resources sunk into the trip encourage a ready-to-spend mind-set even before your car is parked. Psychologically, all this (effort) must be repaid in terms of purchases made,” 2. “Not so long ago, factory outlet stores primarily sold the… Read more »

mightycaseymedia
mightycaseymedia
11 years ago

Both Jon and Scott are right – the outlet mall experience of 20+ years ago was vastly different than it is today. Big brands originally looked to offload seconds, damaged, and failed experiments. When they saw the traffic at their outlet-mall locations rise, they also saw an opportunity to take the “start with high prices, then throw a sale” retail model up several notches. It’s still possible to get top-quality branded stuff at outlet-mall prices at an actual outlet mall, but you have to (a) know the brand well and (b) be willing to drill thru racks and displays looking… Read more »