Recently the giant department store JC Penny has decided to go with a new and hopefully more profitable game plan. The new plan is to change up their discounting techniques. This store will now have regular price items, monthly sale items, and clearance items. The company’s new CEO thinks that they can earn more money by steering clear of constant sales. Even though I might not completely agree with this strategy, I think that it is good that they are taking a look at the old and unprofitable strategy they were using before.
Large department stores simply haven’t been able to do well over the past ten years. They have very high overhead costs and a lot of competition. When they first came out, they destroyed a lot of the smaller stores. These large stores could afford to sell at a lower price point and they could afford to stock large inventories. These days however, the tables have turned. Light footed online stores can undercut large storefront prices without losing any money. The reason for this is that they don’t have much overhead. Because of this, their prices are generally much better than the department store prices.
Have you noticed that the mens fashion blog never write long articles or make great videos on clothing they bought at the local Macy’s or Sears. This is because they aren’t buying from these stores and neither are most of the fashionistas out there.
While these shops were fantastic in the old days, they really only cater to a couple groups of people now. The first type is the person that has waited until the last minute and needs to buy something and get it the same day. The next type of person is the person that has to try their item on before they buy it. These people probably won’t buy much online and are not very price sensitive.
Smart shoppers are always on the lookout for fantastic bargains that they can take advantage of. They don’t want to wait for monthly sales and they don’t want to buy the clearance items that nobody wants. Lets face it, the clearance rack usually isn’t full of great clothing that people want to buy. The clearance rack is usually full of ugly shirts and pants that are cut so horribly that they won’t fit anybody correctly.
One way to get a great deal each and every day is to simply go to a Daily Fashion Deals . These flash sites are always providing their viewers with the latest and greatest deals. Every time you visit one of these sites, you’ll instantly know whats on sale and what isn’t. Its no surprise that these sites are dramatically increasing their sales while the old big box stores are dramatically losing their sales.
The old model probably just isn’t going to work anymore. Big box stores are going to have to let go and shift their focus into their online stores. They can still have local stores, but rather than reducing sales, they should probably just eliminate them altogether. They’ll still be able to take advantage of last minute shoppers and people that don’t want to go online. Also, they can use these stores to accept returns and exchanges from online shoppers.