As we see consumers facing inflation, paying higher prices for necessities, they are also looking to discount retailers to find better bargains on clothing and accessories. Now, post pandemic everyone is out and about again going on vacations, eating out at restaurants and attending events and along with this, people are seeking new apparel to wear. According to the article, Nordstrom stores have faced lackluster performance even since before the Pandemic and investors want to see the store do more to entice its customers. Now they are expecting sales to decline at their full price stores and want to focus on their discount store, Nordstrom Rack. They have decided to ramp up the discount retail store offerings by providing more of their top selling brands within the stores.
One thing that Nordstrom Rack is doing that could give it an advantage against its competitors such as T.J. Maxx, Marshalls and Ross is to provide e-commerce capabilities. Many of its competitors have been hesitant to go this route and instead held strong on their business models to entice the bargain hunting shoppers to physically come into their stores in hopes to make more sales. Another thing they are focusing on is getting rid of name brands that people have never heard of and items that don’t sell as well. It comes as no surprise that many of the big-name department stores such as Nordstrom, Saks off Fifth Avenue and Macy’s are struggling to find a balance between their full price stores and their discount stores during these turbulent times. It will be interesting to see how customers adapt to the changes Nordstrom is making and if they can start increasing their profit margins at the Nordstrom Rack locations. One thing is for certain, Jamie Nordstrom, Chief Store Officer, is optimistic about the growth of Nordstrom Rack and sees a long road ahead for the company. Nordstrom Rack plans to open 20 new stores this year.
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