Also known as destocking shops, factory outlets, sales outlets, etc., outlet stores or discount clothing shops aim to sell out the previous year collections of the manufacturers.
The commercial concept of the outlet
The word « outlet » comes from the English language and is used more and more to refer to factory stores. It is the diminutive of « factory outlet » which literally means « out of the factory ».
The concept of factory outlet stores first appeared in the 1930s. Manufacturers had the idea of selling slightly damaged items to their own employees as they could not be displayed in a shop.
Rather than throwing them away, they preferred to sell them to their employees at a lower price. This « win-win » concept reduced an important financial loss for the manufacturer and gave employees access to quality products at a lower cost.
Little by little, this advantage was extended to the employees’ relatives and then to everybody. The offered products evolved: apart from those with a few manufacturing defects, outlet stores started to sell out unsold items from the previous year’s collections.
The very first outlet store in France officially opened in Troyes in 1936, but it is only in the beginning of the 1990s that groups of outlet stores, also known as “outlet centres”, appeared in Troyes.
Indeed, after the opening of the first « factory outlet centre » in the United States in 1974, this market grew in the 1980s, before slowing down in the 1990’s. The new commercial concept of the outlet then started to grow in Europe.
Why are the brands sold cheaper in the outlet stores?
Outlet stores have the privilege to be able to offer cheaper prices with at least 30 % discount all year round. These very advantageous prices are allowed because they only apply to the previous year’s and even older collections or to defected items.
These permanent 30 % to 50 % discounts on luxury clothes, branded textile or home decoration items can even reach a 70 % discount during sales!
With more than 200 destocking shops, the Troyes Champagne Metropole area remains the historical birthplace of the outlet stores in France.
The different kinds of outlet stores
There are different kinds of outlet stores. In outlet centres, there are essentially destocking stores in which manufacturers sell their own brand products of previous collections. These shops often look like traditional shops of the brand. Items are displayed with care and style and the brand image is nicely showcased. However, prices remain attractive with an average 30 % discount on the items.
Other outlet stores sell several clothing and textile brands. These can be created at the initiative of several brands or they can be sales outlets in which the products are displayed in large warehouses. In this case, the idea is to buy a big stock to manufacturers and resell them to the consumers.
Finally, there are always isolated factory outlet stores, located nearby or inside the production site. This traditional form is the very concept of direct sales between the manufacturers and the consumers. In addition to end-of-series and slightly defected items, newer items can also be found at a « factory price ».