How Department Stores Are Killing Off The Full-Price Apparel Business

by MR Magazine Staff

Neiman Marcus is closing 25% of its Last Call outlet stores to focus on its full-price business. Good luck with that. The tony department store, whose sales per square foot have declined 11% over the past decade, is gambling on the allure of premium products at premium prices like it’s 1999. It’s a curious move when in 2017, the full-priced business at department stores is all but dead — or at least in intensive care, depending on whom you ask. The big designer brands that have long been the meat-and-potatoes of department stores’ full-price business have fallen prey to their markdown mania, the massive popularity of off-price chains that department stores have themselves perpetuated, and the sector’s waning appeal. The result is that department stores have unwittingly turned into “a discounting mechanism more than a real retail” venue, hurting fashion brands’ equity and pricing power along the way, said Katherine Black, principal of retail and consumer strategy at KPMG US, at a retail roundtable discussion in September. Read more at Forbes.