While it isn't a secret that Amazon is looking to enter the clothing and apparel space, Amazon's strategy is more akin to that of a full-price department store, CNBC noted. There are already ample signs that the department store is under pressure, including the fact that since 2011 the group has lost around $25 billion in sales and are on track to lose an incremental $22 billion in sales over the next five years. Related Links: Many Retailers Are 'Incredibly Bad' At Offering Compelling Shopping Experiences, New Survey Finds Gadfly's Banjo: No, Macy's Poor Earnings Don't Dictate Retail's Future
But on the other hand, off-price retailers have gained $14 billion in incremental sales since 2011. The group is different in many ways from full price and department store names since they source from 18,000 vendors in more than 100 countries, which gives them a competitive advantage.
For example, Ross Stores, Inc. ROST offers a savings of 20–60 percent below products Amazon sells, but more importantly, Ross Stores constantly changes its product assortment, which gives it flexibility.
Also, off-price retailers are benefiting from landlords and mall owner's willingness to partner with companies and take over spots that are vacated from sporting goods and office retailer closures, the analyst added. This is even beneficial for off-price retailers since high-traffic malls boast better conditions and foot traffic as opposed to strip centers where the group are mostly contained to today.
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