July 16, 2024
Off Price Retail Market
Ict

Off Price Retail Market is Estimated to Witness High Growth Owing to Opportunity of Cost Savings

Off price retail refers to selling brand name products at discounted prices on a regular basis. Off price retail stores sell brand name fashion apparel and other general merchandise at significant savings compared to department and specialty stores. These stores offer a treasure hunt shopping experience to customers looking for deals on famous brands.

The global off price retail market is estimated to be valued at US$ 315.78 Bn in 2023 and is expected to exhibit a CAGR of 8.5% over the forecast period 2023 to 2030, as highlighted in a new report published by Coherent Market Insights.

Market Opportunity:

The opportunity of cost savings is projected to drive the off price retail market growth over the forecast period. Off price retail stores offer highly discounted prices on apparel, footwear, accessories and home products from popular brands. This allows customers to purchase famous brand products at affordable rates with savings of 20-60% compared to their actual retail prices. In times of economic uncertainty and inflationary pressures, consumers are attracted towards off price retail outlets that help stretch their budgets further. The ability to provide luxurious branded items at a fraction of their original costs provides customers with a unique shopping experience filled with excitement and bargain finds. This opportunity of purchasing quality merchandise at low prices is expected to boost the popularity of off price retailers in the coming years.

Porter’s Analysis

Threat of new entrants: Low as it requires huge capital and established supply chain to compete. Brand loyalty and established relationships with suppliers are also barriers.

Bargaining power of buyers: High as buyers have numerous choices and options available. Buyers can negotiate on price and switch brands easily.

Bargaining power of suppliers: Moderate as key suppliers deal with multiple retailers. Retailers can switch suppliers in case of high prices or non-compliance of quality standards.

Threat of new substitutes: Moderate threat from other discount formats like thrift stores, outlet malls and liquidation stores.

Competitive rivalry: Intense as players compete on pricing, assortments, location and customer experience. Regional players add to competitive pressure.

SWOT Analysis

Strengths: Large scale of operations, wide range of assortments, omnichannel presence, strong brands and customer loyalty.

Weaknesses: Reliance on excess or irregular inventory, price competition erodes margins, need to refresh assortments frequently.

Opportunities: Growing off-price retail market, expanding to smaller cities, catering to rising online shoppers and penetrating international markets.

Threats: Trade conflicts impact supply, increasing operating expenses, natural calamities disrupt supply chain.

Key Takeaways

The global Off Price Retail Market Demand is expected to witness high growth during the forecast period due to growing popularity of bargain hunting among shoppers worldwide.

North America dominates the market currently owing to high density of outlets and high disposable incomes in US and Canada.

Key players operating in the off price retail market are TJX Companies Inc., Ross Stores Inc., Burlington Stores Inc., Nordstrom Rack (Nordstrom Inc.), Marshalls (TJX Companies Inc.), DSW (Designer Brands Inc.), Macy’s Backstage (Macy’s Inc.).

Note:
1. Source: Coherent Market Insights, Public sources, Desk research
2. We have leveraged AI tools to mine information and compile it