Bargain shoppers hunting deals at outlet malls and discount stores may not really be getting the deals they expected on the brand names they love.
"I always had this kind of expectation that whenever they're selling something, like, at the outlet, it's going to be the same thing that you can get at their regular stores," said Lydia Chen, a frequent discount shopper.
In some cases that’s true, but a store clerk at a Coach outlet told investigators at our Scripps station in Denver that’s not always the case. Apparel found in discount stores does not necessarily come from a higher-end store.
"Coach makes separate things for the factory outlet…most of these are for the factory outlet," the store clerk explained.
Another outlet store, J. Crew Factory, posted this statement on their website:
At JCREWFACTORY.COM, we offer deals you've found only in our stores--until now. Now those daily discoveries and satisfying steals are available around the clock. You should also know we have a team dedicated to creating fun, easy-to-wear pieces exclusively for factory. No outtakes, no leftovers, just more of what you love for less. You'll probably want to tell everyone you know about this stylish little secret. (emphasis added)
Outlets and discount stores are no longer simply selling over-stock, irregulars, or last season's designs. Instead they have manufacturing agreements to re-create designs with low cost materials.
Designer and fashion blogger Jay Hallstein researched discount stores like T.J. MAXX. In her blog post, Myth of the Maxxinista, she explained that discount stores have licensing agreements with designer labels.
"They know their outlet shoppers," Hallstein said. "They manufacture it with a lower priced fabric and a lower price cut and sew."
In an email a corporate spokesperson from T.J. MAXX explained: "Some merchandise we sell is developed for us, particularly when what we are seeing in the marketplace isn't the right value for our customers."
This year members of Congress sent a letter asking the Federal Trade Commission to look into the practice. The letter stated:
We are concerned that outlet store consumers are being misled into believing they are purchasing products originally intended for sale at the regular retail store. Many outlets may also be engaged in deceptive reference pricing. It is a common practice at outlet stores to advertise a retail price alongside the outlet store price- even on made-for-outlet merchandise that does not sell at regular retail locations.
Retailers may change products slightly to reduce their cost so they can sell it for less. Savvy shoppers should check the quality of the material, stitching and seams. On the bright side, you're still saving money and buying licensed goods, not fakes. After Consumer Reportssurveyed more than 15,000 readers, they reported 64% of store visits yielded a great value and at 34 percent of stores prices were much lower than sale prices at regular stores.
While undercover, CALL7 Investigators did find some products that were made for the regular retail stores at the outlets, but had to ask where those items they were located in the stores. Most times those products were found in the back of the store.
Chen was surprised when we told her outlets sell apparel made exclusively for their stores, but said she planned to keep looking for deals the outlets, this time with an eye on the details.
"I guess now, I'll just try and make sure it's, you know, stuff that's not just for the outlet," said Chen.
