The History of Outlet Stores – When Did It All Begin?

By | Aug 23, 2020

Outlet stores, also known as factory outlets are stores where brands sell their commodities directly to the consumers. Typically, these commodities come at a cheaper price, and this is what makes outlet stores popular among most people. 

Today, most brands have started operating their own outlet stores. These stores exist as physical shopping places, located in a shopping mall or shopping district. Interestingly, some brands have also started to operate online outlet stores.

What’s the origin of outlet stores?

The first outlet was opened in the eastern U.S. back in the early 30s. These outlets, which were operated as factory outlets, started to offer excess or damaged products to the company’s employees at a cheaper price. With time, the customers to these outlets expanded to other customers who were not employees of the brands operating the stores. 

In 1936, a famous men’s clothing brand by then—Anderson-Little opened the first outlet, which was independent of the brand’s existing factories. The main purpose of this store, together with others was to dispose of damaged or excess products. This continued up to the 70s. 

Vanity Fair opened the first multi-store outlet mall in 1974. This store was located in Reading, Pennsylvania. The growth of outlet malls became rapid in the US in the 80s and 90s. Today, a typical outlet mall in the United States occupies a space of around 100,000 – 200,000 sq. ft. of retail space. This space can gradually grow to around 500,000 – 600,000 sq. ft.—which is about 5 hectares. 

In 2003, the United States had a total of 260 outlet stores, which generated a revenue of $15 billion. The number of outlet malls grew from 113 in 1988 to around 472 in 2013. 

However, you should note that outlets are not an American thing only. They are also spread across other countries in North America, Europe, and Asia. In Canada, the first outlet mall, Dixie Outlet Mall dates back to the late 80s. 

British retailer, BAA McArthurGlen, operates 13 outlet malls in Europe. These malls have over 1,200 outlet stores and occupy about 3 million sq. ft.—which is around 30 hectares. Most people refer to this as an outlet village. Outlet stores have also started emerging in Asia from the mid 90s. 

So, what benefits do people get to enjoy when they shop at outlet malls?

Cheaper prices

As we said earlier, manufacturers normally sell their products directly to the consumer at outlet malls. This, in turn, means that the consumer won’t have to go through a distributor or middle man to get the product. Therefore, the cost needed to get the product to the consumer is significantly reduced. 

This is the major reason why products at outlets are much cheaper than those sold in an ordinary retail store. The closer the outlet is to the factory, the cheaper the price. Some customers say that they get discounts of up to 40% when they shop at outlet stores. 

More product promotions

Generally, outlet malls, such as the designer outlet store, VIA Jurmala, have a lot of product offers and promotions. For instance, you can find seasonal sales, like winter sales, Christmas sales, and New Year sales, among others. Besides, you can also find amazing promotions, like buy two, get one free promotion, since the sellers want to clear products that haven’t moved for a while. Interestingly, you can also find discount coupons, which you can use to push the prices further down. 

Wide range of commodities

This is a common thing with outlet stores. Major brands normally display all their product range at outlets. That means customers get to enjoy a wide range of commodities. Typically, you’ll also have lots of options in terms of shapes, colors, as well as sizes. Besides, since outlet malls are much larger than normal retail stores, you will have all the freedom to explore the mall and search for the products without anyone bothering you. 

All in all, outlet stores tend to be very busy, especially during the weekends and holidays. In fact, you can find long queues for shoppers waiting to get into an outlet during holidays or weekends. Therefore, it can be better if you can find other times to shop, other than weekends and holidays. For instance, shopping on weekdays can save you valuable time that you’d have spent queuing up at the store. 

Category: General

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