Outlet – in search of shopping occasions

Outlet malls have become popular shopping destinations where discounted product prices are a magnet for customers.

In the past, factory outlets were store locations attached to factories that manufactured the goods sold within. These stores sold the damaged and excess goods produced by the factory at sharp discounts, in some cases only to the company’s employees and in others, to all customers.

The outlet formula has evolved, but they are still fundamentally different from monobrand stores. Below we describe several characteristics.

Assortment

In the traditional sense, outlet literally is a store that sells a factory’s goods that can’t be sold in the brand’s traditional retail stores.

An outlet sells clothing, which for various reasons did not find clients in the so-called first circulation, i.e. in stores owned by brand owners, possibly offering clothing from excess production.

Outlets also received defective clothing directly from the production line, where after quality control it was disqualified or clothes were returned to stores by customers as part of complaints (so-called customer returns).

In recent years, the outlet range has changed. There are more and more products manufactured specifically for outlet stores. One reason for this change is  that less overstock and fewer damaged goods is available to sell at factory outlets today.

Location

Outlets are usually located away from the centers of large cities in order to take advantage of lower prices of land and retail space, as well as to avoid competition between outlets and monobrand stores, operating more often in city centers.

Customers

Outlets are a chance for customers with medium or low incomes to buy products from valued brands, which – in other cases – they could not afford. Importantly, outlet customers focus primarily on shopping. They are not looking for entertainment like a cinema, bowling or a restaurant. Coffee can be a nice break during shopping, but it is certainly not the purpose of coming to the outlet.

Advantages of outlets

What distinguishes outlets from other stores is price and quality. We can buy a very high quality product at an attractive price. So it’s worth thinking about visiting the outlet if you want to stock up on clothing products that are intended to serve us for a long time, such as leather shoes or a suit.

The outlet is one of the store formats produced by Ergo Store. In 2019, we prepared, among others Levi’s outlets that can be found in cities such as Athens and Thessaloniki in Greece, Hungarian Polgar and Hate in the Czech Republic.

Photo: Alexander Kovacs / Unsplash