Today's shoppers want it all: bang for their buck and brands.
That recession-rooted trend of seeking value and savings isn't expected to go away, according to national surveys. And, say several of those who closely watch the retail industry, the trend is spurring the creation of more upscale outlet shopping centers.
Forty-one outlet centers are planned to open between 2011 and 2013 across the nation, and seven of those are expected to open this year, according to the International Council of Shopping Centers. It had been common for two or three centers to open per year.
Two groups of developers are working on separate projects that would bring top-brand outlet shopping to the Omaha area. Right now, Omahans have to travel to Kansas City, Kan., (180 miles) or Williamsburg, Iowa, (220 miles) to shop at this type of center.
One of the Omaha-area proposals would double the size of the existing Nebraska Crossing Factory Stores in Gretna and add the flair of a modern, upscale shopping center. The other would turn the land around Cabela's in La Vista's Southport West into an upscale outlet center and entertainment district.
Both projects have the backing of taxpayers in their respective cities, but it's too soon to tell which, if either, will succeed.
The developers of both have a goal of making the Omaha area a shopping destination for those value-conscious, brand-aware shoppers.
“Retailers don't think it's a fad to shift toward value,” said Rod Yates, one of the developers involved in the Gretna project. “The consumer never said ‘I don't want great brands' (during the recession). They said: ‘I don't want to pay full price.'”
Miriam Pechar, director of brand strategy for Atlanta-based children's retailer Carter's, agreed.
“Consumers are looking for value, and they're looking for brand names they trust,” she said. Carter's and its OshKosh B'gosh line both have stores in the Gretna center.
Locally, developers have said Carter's has been part of the push to recharge the Gretna center, which is 56 percent occupied, and has only eight outlet stores.
Wider selection and limited distractions are two benefits of factory store shopping, Pechar said. While a department store has some of everything, she said, a Carter's store sells only Carter's products.
The first outlet center — grouping together stores where manufacturers sold directly to the public — opened in the 1970s. Today there are more than 200 outlet centers offering 300 different types of stores, and the number of retailers offering outlet stores continues to grow.
Tanger Outlets, a group of 33 outlet centers, including the one in Williamsburg, was founded by Stanley Tanger, one of the pioneers of the outlet mall concept. A lot has changed about outlets and their customers in 30 years, Tanger spokeswoman Mona Walsh said.
Outlet stores originally were created to handle factory overruns and mistakes. In their earliest days, outlets were often part of the factory's building. Now, manufacturers are better about forecasting demand, and less defective merchandise reaches the United States.
Newer outlet malls often include design and landscaping features that would remind a shopper more of a trip to the metro area's Village Pointe or Shadow Lake shopping centers than to the Gretna mall now set for remodeling.
Outlet centers now, Walsh said, are “really serving the aspirational shopper, the shopper who wants that quality brand name but at an outlet price.”
Outlet shoppers today, she said, would never find hundreds of the same yellow shirt, sweaters with arms of varying lengths or only sizes on the extreme ends of the spectrum.
“Outlets have not been about distressed product for a very long time,” said Linda Humphers, editor of Value Retail News, a publication of the International Council of Shopping Centers.
Today, Humphers said, an outlet store is just another “channel of distribution,” just as a department or online store is.
A survey by the trade magazine in 2009 showed the typical discount at an outlet, compared with the same brand's full-priced store, was 37 percent.
Sometimes, they're even better.
Thanks to a 40 percent off sale and previous markdowns, a pencil skirt originally priced at $24.99 at the Ann Taylor Factory Store at Legends at Village West Outlets in Kansas City, Kan., was purchased this month for $5.86 — nearly 77 percent off. A sweater originally priced at $59.99 was purchased for $9.99 — about 83 percent off.
That's possible, Humphers said, for several reasons:
>> Outlet stores, often far from higher-priced real estate, typically pay less rent.
>> In many cases, the lease agreements include a clause that requires a certain discount level. A customer at a Dress Barn outlet knows she's getting a deal over the full-price store.
>> No middleman. A shirt from a Ralph Lauren outlet could be the same as that sold at a department store, but if Ralph Lauren sells it, there's no markup.
And arguably the biggest factor: “There are a certain number of made-for-outlet goods,” Humphers said.
Some stores, including Gap, Coach and Gymboree, sell items produced specifically for their outlet stores. Those products may look alike but have, for example, fewer buttons or jewels.
The outlet version may be of a cheaper-to-produce fabric blend, have a different finishing stitch or be a slightly different color, Humphers and Walsh said.
Walsh maintains the differences are minor. “The quality is there. The manufacturer's reputation is on the line. These are not knock-off, cheap goods.”
A lot of shoppers apparently agree. A 2010 report prepared by Credit Suisse suggested that “excluding e-commerce, outlet malls are the most profitable and fastest growing channel in retail.”
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