S02E04 Navigating the Retail Landscape: Off-Price vs. Resale | Nancy Mair

Yeah, I mean, certainly certainly off price is more, you know, does have more entrepreneurship in it because you really have to you have to go with where the market's going and understand that.

So that brings me to the next question, which is off price versus resale.

And I'd love to have the listeners understand the business model because it wasn't really that clear to me at least.

So off price and resale, can you describe the distinction and explain the difference between the two?

So Off Price originally got started because wholesalers or retailers had excess inventory that they couldn't move.

So Off Pricers came and negotiated at values that were much lower than markdowns or sale prices and came in with cash to help these people out of inventory and were able to turn it around really quickly for the customer at really great values.

now back then it really didn't matter what the atmosphere of the store was it just mattered that you were selling great product at great prices you could buy sweaters in the summer you could buy bathing suits in the winter it didn't matter because that customer was very very focused on just getting a deal and it was like a treasure hunt you found something different every time you walked into the store so off price continues to be that Although the stores that are winning are still creating a great atmosphere with great visual merchandising, storytelling, and making sure that they explain to the customer what strategies that they're standing for and what product and brands that they're standing for.

So I do believe off price is kind of pivoting to a mixture of what, you know, department store retail or specialty store retail used to be, which is a customer service experience in a great environment.

still selling great values and great at great prices and great brands now resale is something completely different because you're getting the inventory from your local community or its donations it's inventory from people's closets what they don't what they bought and they really don't want it anymore.

So they actually can sell to a resale model and sell it for a price and take home cash.

And how it works is maybe you're not really sure when you buy that pair of shoes at 50% off final sale, but it's still a great deal.

You take them home, kind of not really sure that they're very comfortable, but you can't return it.

But at least you can sell it to a resale store get some cash from it and that resale store now has a great brand of a great pair of shoes that now can work in someone else's closet so off price you're buying the inventory that's already either produced or you're producing for and the resale model is basically people's closets your community's closets

okay so let me let me understand that because um being a merchant I'm trying to understand.

I mean, there's a whole consignment sort of world that does this, right? And what makes your model different from a consignment store or do you do stuff on consignment?

No, there will not be any consignment.

A consignment is the model where it's also you're taking things from your closet and you're bringing it to a consignment store and they're figuring it out what they can sell it for.

And if it sells in a period of time, then they will give you a payout.

If it doesn't sell, you take your product back and take it home.

So it's technically yours still depends on the deal that you have with the store.

But in resale, you know, you come in with a bag of clothes.

We go through the product and we say, OK, these brands are still hot.

We think we can sell it.

This is what we'll pay you to buy it.

Or this bag, you know, kind of smells from a smoky home or, you know, it's not really in great shape and that brand isn't hot anymore.