The global Off Price Retail Market is estimated to be valued at USD 315.78 Bn in 2023 and is expected to exhibit a CAGR of 8.5% over the forecast period 2023-2030, as highlighted in a new report published by Coherent Market Insights.
- A) Market Overview:
The Off Price Retail Market refers to the segment of retailing that offers branded products at a discounted price compared to the regular retail price. These products are typically sourced from overstock, canceled orders, or end-of-season items, allowing retailers to offer significant discounts to customers. The key advantage of this market is the affordability it provides to consumers. With increasing disposable income and a constant desire for quality products at a lower price, the off-price retail market has gained significant traction. The need for affordable products, especially in developing countries, drives the demand for off-price retail.
- B) Market Key Trends:
One key trend in the off-price retail market is the increasing presence of online platforms. With the rise of e-commerce, off-price retailers have expanded their reach to a larger customer base. Online platforms offer convenience and accessibility, allowing customers to shop for discounted products from the comfort of their homes. For example, companies like TJX Companies Inc. and Ross Stores Inc. have successfully established their online presence, enabling them to cater to a wider audience and achieve higher sales volumes.
- C) Porter’s Analysis:
Threat of new entrants: The off-price retail market has relatively low entry barriers, leading to the presence of numerous players. However, established brands have a competitive advantage in terms of strong supplier networks and brand recognition.
Bargaining power of buyers: Buyers in the off-price retail market have significant bargaining power due to the availability of various options and the nature of the market. Customers can choose from different retailers offering similar products at discounted prices.
Bargaining power of suppliers: Suppliers in the off-price retail market hold significant bargaining power as they can choose to partner with multiple retailers. However, established off-price retailers with a strong market presence can negotiate better terms with suppliers.
Threat of new substitutes: The off-price retail market faces a moderate threat from substitutes such as traditional retail stores offering regular-priced products. However, the attractiveness of discounted products and the affordability they offer make off-price retailers a preferred choice for many consumers.
Competitive rivalry: The off-price retail market is highly competitive, with numerous players vying for market share. Key players such as TJX Companies Inc., Ross Stores Inc., and Burlington Stores Inc. have established themselves as market leaders, creating intense rivalry among competitors.
- D) Key Takeaways:
The global off-price retail market is expected to witness high growth, exhibiting a CAGR of 8.5% over the forecast period. The increasing demand for affordable products drives this growth. Consumers are actively seeking discounted options without compromising on quality.
In terms of regional analysis, North America is currently the fastest-growing and dominating region in the off-price retail market. The presence of established players, changing consumer preferences, and the popularity of online platforms contribute to the region’s growth.
Key players operating in the global off-price retail market include TJX Companies Inc., Ross Stores Inc., Burlington Stores Inc., Nordstrom Rack, Marshalls, DSW, Macy’s Backstage, Century 21 Department Store, Saks OFF 5TH, Stein Mart Inc., Sierra Trading Post, Off Broadway Shoe Warehouse, Gordmans, Bealls Outlet, and Gabriel Brothers Inc. These players have a significant market presence and experience in offering discounted products to customers.
In conclusion, the off-price retail market is poised for high growth due to the increasing demand for affordable products. The presence of key trends such as online platforms and intense competition among players adds to the market’s attractiveness. With a growing customer base and expanding market reach, the off-price retail market is set for a prosperous future.
Ravina Pandya, Content Writer, has a strong foothold in the market research industry. She specializes in writing well-researched articles from different industries, including food and beverages, information and technology, healthcare, chemical and materials, etc. With an MBA in E-commerce, she has an expertise in SEO-optimized content that resonates with industry professionals.