Buyers flock to TJ Maxx for deals as clothing prices soar elsewhere


  • Comparable store sales at TJ Maxx and Marshalls increased 18% in the last quarter compared to the same period in 2019.
  • Shoppers are flocking to low-cost stores for discounts as prices rise elsewhere.
  • Overall, clothing prices rose by a record amount in June.

Buyers are flocking to TJ Maxx to stock up on bargains as prices skyrocket elsewhere.

The low-cost chain saw sales increase in the last quarter, as customers shifted to buying new clothes for dressing as the company gradually reopens.

Marmaxx US comparable store sales – which include TJ Maxx and Marshalls – increased 18% in the most recent quarter, ending July 31, compared to the same period in 2019. Overall, its parent company saw comparable store sales increase 20% in this quarter compared to 2019 in its HomeGoods, Marshalls, TJ Maxx and TK Maxx brands. Its same-store sales were also up in the previous quarter.

According to data from Placer.ai, which tracks foot traffic analysis, low-cost stores have continued to outperform regular clothing retailers in recent months when it comes to foot traffic.

“It appears that customers who missed the low-cost store scavenger hunt experience are now making up for lost time,” the company said in a recent research note.

During a call with analysts on Wednesday, TJX Co said it was in a privileged position to take advantage of today’s inflationary environment as clients look to stretch their dollars further.

According to the Labor Department’s June consumer price index, clothing prices overall rose 4.9% in June from a year earlier, the biggest jump in a decade . In July, they stayed flat.

While TJ Maxx is not immune to industry-wide pricing pressures caused by rising transportation and labor costs, it has more room to raise prices without that the customer feels the effects. This is because TJ Maxx typically sells products at discounts that it says are 20-60% lower than other stores.

Read more: Low-cost retailers like TJ Maxx are adding more niche brands to their supplier portfolio, but experts fear that relying too much on lesser-known brands could lead to sales growth problems.

For shoppers who want to go out and fill their baskets with new clothes without spending too much money, TJ Maxx may be an ideal option.

“Consumers are eager to indulge and indulge themselves after a period of pandemic-induced austerity,” Neil Saunders, managing director of GlobalData Retail, said in an email to Insider. “Given the high volumes of clothing purchased and the fact that there are pressures on household income, TJ Maxx, with its excellent value for money, has been a major beneficiary of this trend.”

Low-cost stores are considered more

recession
– proof than other retailers. When times are tough, consumers tighten their belts and opt for more value-driven shopping experiences.

The years leading up to the pandemic have indicated that bargain hunting is popular even in a strong economy, as TJ Maxx and his rivals have reported continued strong growth.


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