Ah, the thrill of thumbing through the racks of designer bargains at discount stores.
At these so-called “off-price” chains, you can save, on average, 60 percent on name brands, much of it on goods that are in season.
During the Great Recession, shoppers flocked to these stores, and the trend isn’t slowing down. Industry leader TJX Cos., which operates HomeGoods, Marshalls and T.J. Maxx, has added more than 1,000 stores since 2009 and now operates nearly 4,000 units.
In clothing and footwear alone, these chains are ringing up sales of nearly $50 billion, or 15 percent of total sales for that category. That’s a 40 percent increase since 2009, according to RBC Capital Markets.
Scott Tuhy, credit officer at Moody’s Investor Service, expects market share in the off-price arena to increase to 9.8 percent in 2018, up from 6.6 percent in 2009. The growth has been partly at the expense of department stores.
These stores are offering more perks and sprucing up their environments. For example, Macy’s new group of off-price stores called Macy’s Backstage offers stations to charge your cellphone. But not everything is a big deal and so navigating the bins of discounts takes some skill.
“Know what you want, and what is a good price,” said Benjamin K. Glaser, features editor at DealNews.com, a leading comparison shopping website.
Here are seven tips on how to save money and get the most out of shopping.
1. Research and shop frequently: Look through the department store catalogs before venturing out.
“You’ll have a strong idea of items you will be looking for and might find that particular item or a way to recreate the look,” said Suruchi Bhatia, founder of BellaRuchi, a personal styling service in Boston. And shop at least once a week to see what’s new. Saks Fifth Avenue’s OFF Fifth stores receive new merchandise almost daily.
2. Time your purchases: Get to know the sales clerk or store manager. Each store has a basic rhythm as to when certain types of merchandise arrives, and they can give you that information.
For example, one store could be getting shipments of towels every Tuesday. Also sign up with stores’ Twitter and other social media accounts or emails to get alerts on arrivals of new items.
Shop a few weeks after traditional department stores host their big sales events, says Bhatia. New items begin trickling in after the sales, particularly post winter holiday sales, she says.
3. Sign up for loyalty programs: Many of these stores offer loyalty programs so shoppers can get extra savings. At Saks Fifth Avenue’s Saks Off, customers can get updates and more savings by signing up for the More program on the website.
Members can get exclusive discounts and early access to private sales and also be alerted to new arrivals. TJX’s loyalty program offers customers opportunities for free giveaways, as well as private parties, which means first dibs on designer finds.
4. Get the real thing: More than 50 percent of the merchandise at these chains is made specifically for them, says Marshal Cohen, chief industry analyst at market researcher NPD Group.
Even major brands are designing goods specifically for these stores. The remainder is excess inventory from brands or full-price retailers. A big clue: if you see racks and racks of a specific brand that has depth in sizes, chances are these designs were created specifically for the chain.
If you’re not sure, check the seams of the clothing, says Bhatia. Macy’s new concept called Backstage doesn’t currently buy any merchandise made specifically for the off-price sector. The goods for its first group of stores that debuted last fall are either designed for full-price department stores or are the best of the clearance merchandise from its Macy’s stores, says Vanessa LeFebvre, senior vice president of Macy’s Backstage.
5. Do your homework on prices: To figure out what kind of deal you’re getting, don’t just look at the manufacturer’s suggested price, says Cohen.
The so-called list price is often inflated to make the discount look better. So pull out your smartphone and compare prices.
6. Inspect for flaws: Off-price stores may have moved away from the image of stale and damaged goods. But shoppers still need to check for flaws. If it’s clothing, check for holes and snags in the material. For food and beauty products, check expiration dates, says DealNews.com’s Glaser.
7. Don’t get carried away: Sure, there are racks and racks of merchandise with slashed prices, but that doesn’t mean you should go overboard. Stick to a budget and buy what you need, not what you think is just a good deal.
“No matter what a great deal it is, it is not a good deal if you’re not going to use it or wear it,” said Cohen.
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