My mom always had a fascination with T.J. Maxx, and I remember as a kid being dragged along to go shopping with her in what I saw as a disorganized discount store. Since then, I hadn’t visited a T.J. Maxx or a Marshalls…until yesterday.
As I told you before, I went to Boston for the T.J. Maxx/Marshalls Overnight Event to learn more about their off-price brands. Contrary to what I originally thought, the items sold at T.J. Maxx and Marshalls is anything but the second-rate stuff sold in discount stores like WalMart! Both chains (owned and operated by TJX) offer the same quality goods as department stores, but at significantly reduced prices. They offer labels for every budget, from DKNY and Nine West to Dolce and Gabbana, Juicy Couture, and Prada, to name a few. Come back tomorrow to see the great boots and clothes I got from their stores!
Karen Coppola, senior vice-president of marketing, asserted during the event, “We have quality goods at the best prices on the planet,” and after my visit, I have to say I agree.
Now if you’re like me, you’re wondering, how are T.J. Maxx and Marshalls able to offer such amazing deals to us?
How off-price retail works
Off-price retailers, such as T.J. Maxx and Marshalls, sell clothing and accessories from major-label brands at a significant discount. These companies take advantage of overruns, canceled orders, and forecasting mistakes made by their counter-parts in the full-price retail sector. When a major designer produces more clothing than it can sell through specialty retailers or department stores, or a store can’t move all of the items in a particular line, the excess inventory is sold at a 20%-60% discount to an off-price retailer. The company passes these savings onto consumers, marking up goods by a lower percentage than full-price stores and instead building their operating margins by moving a high volume of inventory quickly, at rock-bottom prices.
And because they move inventory so quickly, T.J. Maxx and Marshalls send their buyers all over the world to negotiate with designer merchandise vendors weekly, not seasonally like department stores do. This allows them to quickly respond to changing trends and to scoop up great deals at the last minute. Buyers travel more than 40 times per year on buying trips! This is compared to department store buyers, who only buy four times per year.
Here’s a basic rundown of how merchandise reaches the shelves at both T.J. Maxx and Marshalls:
- Buyers analyze trends and create seasonal plans. Let’s say they find that a purple blouse is THE item to have.
- Buyers set off around the world to find the perfect blouse from the thousands of designer merchandise vendors they work with.
- Prices are negotiated up to the last minute to ensure the best possible price.
- Merchandise is purchased from the vendor, processed at one of several T.J. Maxx or Marshalls distribution centers across the country, and can be sent out to arrive on store racks in as little as two weeks.
- The blouse reaches the rack at up to 60% off the suggested retail price. Meanwhile, the same blouse may also be on a rack at a department store nearby with a much heftier price tag attached. To maintain their relationships with vendors, T.J. Maxx and Marshalls do not put the labels sold in their stores in advertisements or other media. This also makes sense, since the inventory (and the labels carried) is constantly changing.
Come back to Shoe Smitten later tonight, when some common myths about T.J. Maxx and Marshalls will be debunked!