Department stores suffer losses in revenue

By Associated Press | November 19, 2007

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BOSTON — Paul Murphy went bargain hunting at a discount store called Building 19, and ended up with quite a find: A charcoal gray wool men’s suit for $66 that he found priced at $329 at a major department store.

“I bought two of them — one for me and one for my son,” the 62-year-old piano salesman from Scituate, Mass. said after a visit to a downtown Boston tailor to have the pants altered.

The suit was part of a windfall of closeouts that discounters are snapping up as department stores unload a glut of fall and winter fashions. Unseasonably warm early fall weather and economic jitters left stores with unsold merchandise taking up sales floor space heading into the crucial holidays.

Off-price retailers are feasting on overstock of cool-weather clothing at prices far below what traditional retailers originally paid — deals expected to help discounters boost their profits. And they may pass on some of their benefits to consumers in the form of steeper-than-usual discounts and a fresher apparel selection.

“There are always bargains around, but this is unusual,” said Jerry Ellis, who co-founded the 14-store New England chain, a self-described “bottom of the barrel” retailer of salvage merchandise, in 1964. “The traditional vendors are almost desperate.”

Some retailers are offering sales and running special promotions earlier than usual before the traditional kickoff to holiday shopping after Thanksgiving.

“What’s happening right now is consumers aren’t shopping,” said Patricia Walker, a partner in the consulting firm Accenture’s retail practice. “Once retailers put deals out there, it’s unclear if consumers will look for them in at the department stores, at the specialty stores, or the discounters. Certainly, the discounters will be offering better products than they have in the past.”

– Mark Jewell, Associated Press Writer

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Comments

5 Responses to “Department stores suffer losses in revenue”

    Zelda Ketchum Bowser:
    November 19th, 2007 2:22 pm

    People are wising up. Nowadays, regular people realize that the new shirt they have lusted after for legthy periods of time will not bring them fame or fortune. Is a good development.

    Whatever:
    November 19th, 2007 5:21 pm

    It’s not a good development as our currency becomes worthless.

    willy limp lump:
    November 20th, 2007 1:06 pm

    well, whatever, people aren’t living in cardboard boxes and eating out of dumpsters (yet). There is still a place for the consumer and the dollar has value even non-tangible goods.

    Whatever:
    November 20th, 2007 2:11 pm

    Of course. I just know that department store sales are used as an indicator of economic stability, and poor sales should be seen as more than just people laying off the useless crap.

    2girls1cup dot com:
    November 22nd, 2007 12:42 am

    I think the age of mass consumerism might be over. People are no longer yearn for the “things” they did in the 90’s. Yeah, they get boners for the Bravia wide screen TV when late Nov. rolls around——-but the eating out and paying for basic services and daily needs eats up whatever greenbacks may be in their wallet.