There was a time when you could only find Cartier’s Pasha C automatic watch in the jeweler’s showroom but, these days, fashion-conscious shoppers don’t have to look any farther than Costco (Stock Quote: COST) to find this and other luxury items for as much as 60% off.
“It’s like seeing Hermes in a Costco,” says Stephen K. Platt, director and research fellow for the Platt Retail Institute, in Hinsdale, Ill. “If I had one of these super-premium brands and saw them there, I’d have a heart attack.”
Costco isn’t the only retailer hawking luxury goods. TJ Maxx (Stock Quote: TJX) is also getting a piece of the action.
Runway at The Maxx, the company’s store-within-a-store, has been hawking silk Marc Jacobs dresses and Dolce & Gabanna cigarette pants for as little as $40 since they opened in 2005. The 42 Runway locations have done so well that the company plans to open six more locations nationwide in March.
The Scoop on High-End Retail Discounts
Retailers such as Marshalls, TJ Maxx and Costco aren’t just giving merchandise away even though it may seem like it. They’re just spending less for it.
Department stores such as Macy’s (Stock Quote: M), Bloomingdale’s and Nordstrom (Stock Quote: JWN) buy thousands of clothes, shoes and home goods every year. They generally buy everything for a season at once, several months early. (For example, they order their summer selections in December.) But off-price retailers like TJ Maxx order continuously throughout the year. So, if a vendor has 1,500 bathing suits, and only sells 1,000 to a department store that winter, the vendor can get rid of the extra inventory by selling it at a discount to Marshalls.
